No Action on Employers Over Payment of Wages During Lockdown: SC

MHA order dated 29 March said all employers had to pay all workers full wages even during lockdown.

2 min read
MHA order dated 29 March said all employers had to pay all workers full wages even during lockdown.

The Supreme Court on Friday, 12 June, diluted an earlier order by the Ministry of Home Affairs that full payment of wages to must be made to employees during the 54-day nationwide lockdown to contain the outbreak of COVID-19.

The apex court asked the government to not take any coercive steps against private employers who have not paid salaries to their employees during the lockdown.

The court also said that the issue should be resolved through negotiations between the employers and their employees regarding wage payment and that it must be facilitated by state government labour departments.

The government has been given four more weeks to file a reply on the legality of 29 March notification that asked employers for mandatory payment of wages.

The Supreme Court pronounced the order on a clutch of pleas by several companies including MSMEs challenging the MHA notification.

“We directed no coercive action to be taken against employers. Our earlier orders will continue. A detailed affidavit has to be filed by the Centre in last week of July. Negotiation between employees and employers to be facilitated by state government labour departments,” Justice Ashok Bhushan said.

The order was pronounced by a bench comprising of Justices Bhushan, Sanjay Kishan Kaul and MR Sha.

On 4 June, the Centre had informed the apex court that its 29 March notification on full payment of wages to workers by their employers during the lockdown was not unconstitutional.

The Centre's counsel had contended it was a measure taken to prevent a financial crisis in the lower strata of the society, labourers and salaried employees.

The Centre, in the affidavit filed, said the 29 March order was not a permanent measure, and it has already been withdrawn. "It is further emphasised and reiterated that the said directions (29 March order) were issued by Union of India as a temporary measure to mitigate the financial hardship of the employees and workers specially contractual and casual during the lockdown period," said the Centre.

The Centre said regarding the contention that the employers are not in a financial position to pay their employees and workmen, no material has been placed on record to establish this fact.

“The petitioners-employers must be directed to furnish proof of their incapacity to pay wages and salaries in terms of the 29 March order, by placing on record their audited balance sheets and accounts,” the Centre had said then.

Scores of firms from across the states had moved the apex court challenging the 29 March order, which obligated employers to pay full wages to their workers during the period of the lockdown. The industries have challenged the MHA on the source of power to pass such directions, and highlighted that financial burden cannot be put on the private firms, when the companies are shut during lockdown.

(With inputs from ANI and IANS.)

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