Since the outbreak of COVID-19 pandemic in India, the unprecedented nation-wide lockdown mandating closure of commercial, private and industrial establishments (with limited exceptions) has been extended from time to time since 24.04.2020.

Presently, the lockdown has been extended till 31.05.2020. One of the most significant fallouts of the government mandated lockdown across India, has been the exodus of migrant workers who were left without daily employment or wages, and also payment of wages to workers for the time they have been unable to attend work due to implementation of lockdownrelated measures.

This articles provides an overview of the measures taken by the Government of India, through the Ministry of Home Affairs ("MHA") and Ministry of Labour and Employment ("MLE"), to address the labour law issues arising in the wake of the nation-wide lockdown. Labour being a concurrent subject, the State governments have also issued notifications in this regard, some of which are discussed below.

A. Central Government measures

The MLE has provided a number of advisories for the benefit of employees and workers. On 20.03.2020, the MLE advised employers of public and private establishments to extend their cooperation by not terminating their employees, particularly casual or contractual workers, or reducing their wages. If a worker takes leave, he/she should be deemed to be on duty without any consequential deduction in wages for this period. If the place of employment is made non-operational due to COVID19, the employees of this unit would be deemed to be on duty.1

The MHA, on 29.03.2020, in an order to States and Union Territories ('MHA Order on Migrant Workers'), directed them to take additional measures to deal with the movement of large number of migrants in different parts of the country during the lockdown period. Some of the important measures specified by the MHA are:

- States/UTs to ensure adequate arrangements of temporary shelters, food for the poor and needy that are stranded due to lockdown measures,

- Migrant people who have moved out to reach their home states to be kept in the nearest shelter by respective State/ UT government quarantine facilities after proper screening for at least 14 days,

- All employers to make payment of wages to their workers on the due date without deduction for the period of lockdown,

- Landlords of rented premises shall not demand payment of rent for a period of one month from the workers,

- Landlords forcing labourers/ students to vacate premises would be liable for action under the Disaster Management Act, 2005.2

However, this obligation has been modified by the latest order of the Ministry of Home Affairs dated 17.05.2020, which extends the lockdown until 31.05.2020 ('MHA Lockdown-4 Order'),3 which provides that (unless otherwise specified) all Orders issued by NEC under Section 10(2)(l) of the Disaster Management Act, 2005, shall cease to have effect from 18.05.2020. Therefore, from 18.05.2020, the MHA Order on Migrant Workers, which was issued by the Chairperson of the National Executive Committee under Section 10(2)(l) of the Disaster Management Act, 2005, will cease to have effect.

Therefore, the obligation that was earlier placed on employers to pay their workers/employees is not in effect anymore.

The MLE also notified an amendment to the Employees' Provident Funds Scheme, 1952 on 27.03.2020 to the effect that the Commissioner or any officer subordinate to him (where so authorised by the Commissioner), may permit withdrawal of a non-refundable advance from the provident fund account, for an amount which is lesser of the following: (i) not exceeding the basic wages and dearness allowances of that member for three months; or (ii) up to 75% of the amount standing to his credit in the Fund. Such an advance can be released upon application being made by a member of the Scheme employed in any establishment or factory located in an area declared as affected by the outbreak of the epidemic by the appropriate Government.

The Ministry of Skill Development and Entrepreneurship ('MSDE') vide office memorandum dated 30.03.2020 notified that as per the lockdown imposed by Government of India due to the COVID-19 pandemic, all establishments must pay full stipend as applicable to the apprentices engaged in their respective establishments, under both designated and optional trade during this time period. Reimbursement of stipend to establishments under National Apprenticeship Promotion Scheme (NAPS) shall be paid by the Government for the lockdown period as per the NAPS guidelines.4

The Ministry of Corporate Affairs ('MCA') also released a series of Frequently Asked Questions ('FAQs') and clarifications regarding payment of wages and Corporate Social Responsibility ('CSR'), which clarified that:

- Payment of salary/wages to employees and workers during the lockdown period is a moral obligation of the employers, as they have no alternative source of employment or livelihood during this period. Therefore, payment of salary/ wages to employees and workers during the lockdown period would not qualify as admissible CSR expenditure.5

- Payment of wages to temporary/casual/daily-wage workers during the lockdown period is part of the moral/humanitarian/contractual obligations of the company and is applicable to all companies irrespective of whether they have any legal obligation for CSR contribution under section 135 of the Companies Act 2013. Therefore, payment of wages to temporary or casual or daily wage workers during the lockdown period shall not count towards CSR expenditure.6

- However, if any ex-gratia payment is made to temporary/casual/daily-wage workers over and above the disbursement of wages, specifically for the purpose of fighting COVID-19, the same would be admissible towards CSR expenditure, as a one-time exception, provided there is an explicit declaration to that effect by the Board of the company, which is duly certified by the statutory auditor.7

Download >> Covid-19 Lockdown Related Labour Measures: An Overview

Footnotes

1 MLE Advisory Letter No. D.O. No. M-11011/08/2020-Media, 'Advisory to public/private establishments to not terminate the employees from their jobs or reduce their wages', dated 20.03.2020.

2 MHA Order No. 40-3/2020-DM-I(A), dated 29.03.2020.

3 MHA Order No. 40-3/2020-DM-I(A), dated 17.05.2020.

4 MSDE O.M. No. MSDE- 1(3)/2020AP(PMU), 'Clarification on payment of stipend to apprentices and reimbursement of stipend to establishments under NAPS during COVID-19 lockdown', dated 30.03.2020.

5 Ministry of Corporate Affairs MCA General Circular No. 15/2020 (F. No. CSR-01/4/2020-CSR-MCA), 'COVID-19 related Frequently Asked Questions (FAQs) on Corporate Social Responsibility (CSR)' dated 10.04.2020, FAQ 5.

6 Ministry of Corporate Affairs MCA General Circular No. 15/2020 (F. No. CSR-01/4/2020-CSR-MCA), 'COVID-19 related Frequently Asked Questions (FAQs) on Corporate Social Responsibility (CSR)' dated 10.04.2020, FAQ 6.

7 Ministry of Corporate Affairs MCA General Circular No. 15/2020 (F. No. CSR-01/4/2020-CSR-MCA), 'COVID-19 related Frequently Asked Questions (FAQs) on Corporate Social Responsibility (CSR)' dated 10.04.2020, FAQ 7.

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