India: Order obliging Employers to Pay Wages during COVID-19 Lockdown is Withdrawn

In order to combat the COVID-19 crisis, the Central Government of India and various State Governments have been declaring lockdowns in India for the past 3 months, subject to certain terms and conditions. The Ministry of Labour and Employment issued an advisory in the month of March 2020, wherein all employers were advised to not terminate the services of its employees or reduce the wages of such employees during the lockdown period. It was further stated under this advisory, that if a place of employment is non-operational on account of COVID-19, the employees in such affected establishments will be considered to be on duty for the non-operational period.

Further, on 29 March 2020, the Ministry of Home Affairs passed an order on account of which employers were required to pay wages to employees on time and without any deduction, during the lockdown period, and the violation of this order attracted criminal sanctions. This order sparked a lot of debate within the country, as, due to loss of revenue on account of the lockdown, most employers were not in a position to pay wages to its employees. However, this order has ceased to exist with effect from 18 May 2020.

This order had also been challenged before the Supreme Court of India, wherein after several rounds of hearings, the Supreme Court has directed employers to negotiate terms and enter into a settlement with its employees with respect to payment of wages during the lockdown period. The final order is likely to be passed by the Supreme Court of India in July 2020.

For more information on these articles or any other issues involving labour and employment matters in India, please contact Avik Biswas (Partner) of IndusLaw at avik.biswas@induslaw.com or visit www.induslaw.com.

For more information please contact Joseph Granato, Communications Manager at L&E Global at joseph.granato@leglobal.org.