Payment of Wages
Payment of Wages
Litigation News

"Treat this with urgency, lot of people are affected", Supreme Court in plea seeking exemption from payment of wages during Lockdown

Debayan Roy

The Supreme Court today directed the Central Government to file a response this week on the pleas filed seeking exemption from the payment of wages to workers during the period of the COVID-19 lockdown. (Payment of wages order)

During the hearing today, Justice Ashok Bhushan orally observed,

"Treat this with urgency.. lot of people are affected. Please file a response."
Justice Ashok Bhushan

Appearing for the Central Government, Attorney General KK Venugopal today told the Bench that a new notification was issued on May 17, which supersedes the earlier March 29 Ministry of Home Affairs (MHA) order that is under challenge in the instant case.

All the same, the Bench of Justices Bhushan, Sanjay Kishan Kaul and MR Shah has directed the Central Government to file a response in the matter this week, while adjourning the case by a week.

The lead petitioner in the case is Ficus Pax, represented by Advocate-on-Record Jeetender Gupta.

The Karnataka-based company had challenged the constitutional validity of a March 20 notification by the Secretary (Labour & Employment) and clause III of the March 29 notification by the MHA, both of which compelled payment of full wages to workers and employees during the period of lockdown.

The petitioner company has submitted that these two notifications were “arbitrary, illegal, irrational, unreasonable and contrary to the provisions of law including Article 14 and Article 19(1)(g) of the Constitution of India.”

Ficus Pax had stated that before the lockdown, it had 176 permanent workers and 939 contract workers across all its factories/ warehouses/ offices and that it had “paid the wages to all workers including contractual workers for the month of March 2020.”

It was contended that these notifications turn “an otherwise stable and solvent industrial establishment, especially an MSME establishment, into insolvency and loss of control of business.”

Ludhiana Hand Tools Association, through Advocate-on-Record Rajeev M Roy, stated that the March 29 MHA order under the Disaster Management Act, 2005 is violative of Articles 14, 19(1)(g), 265 and 300, of the Constitution and that it must be “struck down.”

The petitioner had contended that organisations should be completely exempted from paying their workmen during the lockdown implemented in the wake of novel coronavirus pandemic as,

“one-sided implementation of contract alone is not permitted since relationship between employer and employee consists of reciprocal promises wherein payment can be enforced only against consideration of performing work.”

Advocates Rajeev M Roy, Abhay Nevagi and Jamshed Cama appeared for the petitioners.

The PIL filed by Advocate Aditya Giri was tagged in the matter as well, along with other petitions. The plea sought the Court to issue directions to both Central and State Governments to formulate a framework to deal with the problems faced by private sector employees, who have been suddenly laid off due to the lockdown.

The plea by Advocate Giri sought affixation of the liability and accountability of all stakeholders, including the employers for "their dereliction of duty and negligent role in failing to curb laying off of the employees" during this pandemic.

[READ ORDER]

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