No coercive action against companies on payment of wages

Tribune News Service

New Delhi, June 4

The Supreme Court on Thursday said no coercive action could be taken against employers for violating the March 29 notification of the Ministry of Home Affairs (MHA) mandating full payment of wages to employees during COVID-19 lockdown.

The interim order came from a Bench led by Justice Ashok Bhushan after the Centre submitted that the MHA notification was a temporary measure for 54 days.

The top court reserved its order on a batch of petitions challenging the validity of the MHA notification for June 12.  They also challenged Labour Ministry's March 20 notification on the issue.

The petitioners, including Karnataka-based company Ficus Pax and Ludhiana Hand Tools Manufacturer Association, have challenged the validity of Section 10(2)(i) of the Disaster Management Act, 2005.

The provisions of this Act cannot “impinge upon express provisions of the Industrial Disputes Act, 1947 and take away the right to layoff workmen during times of natural calamity, they said.

Terming the MHA order under the Disaster Management Act, 2005 as arbitrary, they said the order violated the private companies' right to carry on any occupation, trade or business guaranteed under Articles 19(1)(g) of the Constitution.

Attorney General KK Venugopal said the notification was to stop the workers from migrating en masse and preventing human suffering.

"But your notification compelled the payment of 100 per cent of salaries...it can be around 50 to 75 per cent. So the question is, do you have the power to get them to pay 100 per cent, and on their failure to do so, prosecute them?" the Bench sought to know.

As several counsel representing the companies attacked the MHA and Labour Ministry notifications, the Bench asked, "Can you run an industry without labour? You have to strike a balance and this should not be tilted either on the side of the employer or the employees."