SUPREME COURTS PULLS UP CENTRAL GOVT ON ISSUANCE OF ADVISORIES TO COMPANIES TO PAY WAGES TO WORKERS AMIDST COVID LOCKDOWN
The Hon’ble Supreme Court of India on 27.04.2020 has granted a period of two weeks to the Central Government to file its response with regards to the Writ Petitions being filed by companies in the private sector, particularly MSME’s as a result of notifications from the Ministry of Home Affairs and the Ministry of Labour and Employment notifications on payment of salaries to employees and workers amidst the COVID-19 lockdown.
On 20.03.2020 and 23.03.2020, the Ministry of Labour and Employment vide circular D.O.No.M-11011/08/2020 had stated that employers of both the public and private sector were to extend their cooperation by not terminating employment or reducing wages of their employees/workers.
Further, on 29.03.2020, the Ministry of Home Affairs via the Press Information Bureau had stated that all employers were to pay wages to their workers without any deduction for the period that their establishments are under closure during the lockdown.
The instant petitions were filed in the Supreme Court by a Mumbai based Textile firm, Nagreeka Exports(original petitioner) who had later withdrawn its petition considering the number of pleas on the same issue flooding the Apex Court, a Karnataka based packaging company-FicusPax Private Limited and the Ludhiana Hand Tools Association(consisting of 41 MSME’s).
The petitions were being filed on the ground that it would be irrational to treat all private establishments alike irrespective of profits, loss, debt, turnover etc with regards to the blanket directions stated by the Ministry of Home Affairs. In essence, the Government has not distinguished between profit or loss making units as a base to decide if employees or workman of these establishments need to be paid salaries, salaries were to be paid irrespective of the same.
The petitions were filed challenging various Articles of the Constitution of India on grounds that the two notifications were arbitrary, illegal, irrational and unreasonable. The Ludhiana Hand Tools Association contention was that the 29.03.2020 notification of the MHA under the Disaster Management Act,2005 is violative of Articles 14,19(1)(g),265 and 300 of the Constitution of India and the said notification is to be struck down.
The plea was argued on the grounds that when the economy is in lockdown and business is stressed, it becomes nearly impossible to continue making payments to employees, and in the long run lead to closure of business units causing unemployment.
Situations like this cause distress for both employers as well as employees as they have their respective hardships and trials being faced by them during the lockdown period. The Central Government shall hopefully relieve some amount of the burden on the employers, but also keep in mind the misery of the employees and workers who have to look after their families as well.