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Centre’s order on wages: SC reserves verdict, says no coercive action against employers

During the hearing, the court observed that some negotiations have to happen between employers and workers to iron out what has to be done for the salary for 54 days during the COVID-19 lockdown.

By: Express Web Desk | New Delhi | Updated: June 4, 2020 11:58:16 pm
SC on wages, India lockdown, Supreme court on employers, no coercive action against employers, Centre's Wage order, India news, indian express The Supreme Court said that no coercive action will be taken against any employer for violating MHA’s order.

The Supreme Court Thursday reserved its verdict for June 12 on a batch of petitions challenging Centre’s March 29 order asking employers to pay full wages to employees for the period of lockdown. The top court, however, said that no coercive action will be taken against any employer for violating MHA’s order.

During the hearing, the court observed that some negotiations have to happen between employers and workers to iron out what has to be done for the salary for 54 days during the COVID-19 lockdown.

Justifying its direction on wages in the apex court, Centre said that employers claiming incapacity in paying salaries must be directed to furnish their audited balance sheets and accounts in the court.

In an affidavit filed in the apex court, the government has said the March 29 directive was a “temporary measure to mitigate the financial hardship” of employees and workers, specially contractual and casual, during the lockdown period and the directions have been revoked by the authority with effect from May 18. The affidavit also said the direction was fully in conformity with the provisions, scheme and objects of the Disaster Management Act and it is not ultra vires.

While requesting the top court to dispose of as infructuous the batch of pleas challenging the March 29 notification, the government said the “impugned notifications have outlived their life and adjudication of the same would only entail an academic exercise as it would not be in the interest of public to seek recovery of salaries paid to employees and workers for the said 54 days”.

The government said it would neither be in the interest of justice nor in public interest to adjudicate the validity of notification which operated only for 54 days — from March 25 to May 17 — to mitigate the financial hardships of crores of workers and employees.

“In the event, this court is not inclined to dispose of the present proceedings as having become infructuous and is inclined to adjudicate this matter on merits, the petitioners-employers must be directed to furnish proof of their incapacity to pay wages and salaries in terms of the order dated March 29, 2020 by placing on record their audited balance sheets and accounts,” the affidavit said.

The affidavit has been filed as the apex court, while hearing the matter on May 26, had asked the Centre to file counter affidavit within a week on the issues raised in the petitions.

On May 15 also, the Supreme Court had restrained the government from taking any coercive action for the time-being against companies and employers not following the official direction to pay employees full wages for the period of the national lockdown.

Taking up a petition filed by Hand Tools Manufactures Association on the, the bench of Justices L N Rao, S K Kaul and B R Gavai had remarked that the March 29 circular of the Ministry of Home Affairs (MHA) was an omnibus order and there was a larger question involved which needed to be answered.

Justice Kaul said there may be smaller companies which are not earning and are, hence, unable to pay. Issuing notice to the Centre, the bench said these units will not be able to pay their workers unless the government extends a helping hand.

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