‘The Central Government has issued Advisories and Directions under the Disaster Management Act 2005. & order under Section 10(2) was issued on March 29, 2020 dealing with the issue of payment of wages to workers’.
The question is that
Is there a power under the Disaster Management Act to decide the question of payment of wages during the period of lockdown?
Is the employer bound to pay wages during the lock down period without any pay cut.
At first we have to see the Constitutional validity of the Disaster Management Act.
Since disaster management does not figure in the scheme of enumerated subjects in any of the three lists of the seventh schedule of the Constitution.
The Central Government has the legislative competence to make laws on the subject.
As a subject of legislative competence, disaster management may, thus, impliedly be taken to be part of the provisions of article 248 dealing with residuary power of legislation.
By providing that parliament has exclusive power to make any law with respect to any matter not enumerated in the concurrent list or state list, article 248 extends its jurisdiction to the subject of disaster management in view of the fact that subject does not find mention in any of the list given in the seventh schedule of the Constitution.
Thus the central government has the power to impose clauses against payment of wages during the lock down period, A bench of Justices N V Ramana, Sanjay Kishan Kaul and B R Gavai, in a hearing conducted through video conferencing, heard counsel for three private firms including Nagreeka Exports Limited and Ficus Pax Private Ltd against notifications of the Ministry of Home Affairs asking them to pay full wages to employees during lockdown.
Article 14 ‘Equality before the law’
Meaning of equal protection
Equal protection means the right to equal treatment in similar circumstances both in the privileges conferred and in the liabilities imposed.
Both employer and employee have a fundamental rights to carry on any occupation, trade or business.
Article 21 Protection of life and personal liberty
No person shall be deprived of his life or personal liberty except according to procedure established by law.
The lockdown ordered under Disaster Management Act (DMA) and the mandatory directions for payment of wages are inseparable within the limit of article 14 and Article 21 of the Constitution.
If Employer accepted the lock down order under DMA then the undertakings are obligatory to obey the mandate of payment of Wages which is also inseparable.
In the present scenario we have to go the black and white definition of ‘Employer’ & Employee.
Employer meaning in the Cambridge Dictionery ‘a person, company, or organization that payspeople to work for them’.
Employee meaning in the Cambridge Dictionery ‘someone who is paid to work for someone else’.
Here is the nexus between Employer and employee the question arises without contributing/work how any worker can claim wages?
The answer would be ‘the worker neither absent nor abandoned, they are obeying statutory direction issued by Central Government. The statutory / social relation between employer and employee stands continue during the period of lock down. hence Payment of salary/ wages in normal circumstances is a contractual/ statutory obligation of the company. When employer was making profits, they weren’t sharing it with the workers now the employer cannot pass on the loss to the workers alone. Without payment of wages how worker will avail Soap, Sanitizer and other health care facility.
It is the social and moral responsibility of the employer to ensure full payment of wages during the lock down so that their livelihood may not hamper during the period.
To manage disaster under the DMA passing this burden, financial or otherwise to any Industry, shops and establishments, private employers is not the solution however the clarifications issued by the Ministry of Corporate Affairs on 10th April 2020 where it said: "Payment of salary/ wages in normal circumstances is a contractual and statutory obligation of the company. Similarly, payment of salaries/wages to employees and workers even during the lockdown period is a moral obligation of the employers, as they have no alternative source of employment or livelihood during this period." these clarifications also envisaged that whether payment of salaries/wages during lockdown period would qualify as Corporate Social Responsibility.
It is clear that there is communication gap between various ministries on the issue of whether payment of wages without any deductions during lockdown is a moral or a statutory obligation under the provisions of the DM Act.
However this is not the right time to play tug of war between Government and employer, the nation wide lock down has been extended up to 17Th May, 2020 and no body can say that the 17th will be the end it is also will be extended thereafter and so on, in such a situation both the part is required to sit together and find an amicable solution so that the employer have liberty to distribute wages below the minimum wages (As per skilled, un skilled, semi skilled, Highly Skilled, etc) so that burden may minimize. It is quiet obvious that the fundamental rights of the employer under artcle 19(l)(g) of the constitution of India stands effectively suspended during lockdown. Central Government requires to declare financial package for industry as well as for MSME. Otherwise employers may face hardship and push under bankruptcy to knock the door before NCLT or any other Authority as prescribed.
The entire contents of this article are solely for information purpose and have been prepared on the basis of relevant provisions and as per the information existing at the time of the preparation by the Author. Compliance Calendar LLP and the Author of this Article do not constitute any sort of professional advice or a formal recommendation. The author has undertaken utmost care to disseminate the true and correct view and doesn’t accept liability for any errors or omissions. You are kindly requested to verify and confirm the updates from the genuine sources before acting on any of the information’s provided hereinabove. Compliance Calendar LLP shall not be responsible for any loss or damage in any circumstances whatsoever.