Current Scenario Regarding Payment of Wages to Employees During Covid 19 Pandemic

As per the case before the Hon’ble Supreme Court in the form of PIL, wherein payment of wages during the closure of industry at full rates which was directed by Maharashtra Government was challenged. In the said SPL though, initial interim orders are passed, that cannot be treated to be a verdict of the Court.

The issue with respect to the payment of the wages to the workmen in the industrial establishments was discussed before the Central Government and u/s. 10 (a)(i) of Disaster Management Act, the Central Government has issued an Order on 29/03/2020 wherein the Central Government has directed that the workmen should be paid their wages even during the closure due to lock down. Therefore, payment of wages to the workmen will be essential during this period.

At this stage, we would also like to bring to your kind notice that the said notification / order of the Government is applicable to the workmen and therefore for all the employees of the category higher than the workmen, you can negotiate with them and decide about deduction of salary based upon the actual turnover of the company and work. Accordingly, the necessary MOU may be entered into between all the employees above the category of the workmen and the proportionate reduced amount can be paid to these officers.

Regarding the contract employees, it will be necessary to talk to them and get the contract modified to the extent that there services will be continued, however the modified contract should be executed in such a manner that there is a waiver from payment of the salary for the period of lock down during which the contract cannot be executed. Again in this respect we have been making a thorough search of various aspects of Force Majeure and we are of the view that the employer will get a very little help of Force Majeure clause in these circumstances and therefore I suggest that it is proper to talk to the employees and get the contract modified to the extent that there is a waiver of salary during the lock down period.

I hope that this clarifies the present position with respect to the payment to employees. In case of any query or drafting of any necessary MOU or agreement please feel free to contact us in this regard.