On 11 March 2020, in the wake of the alarming levels of its spread and severity around the globe, the Coronavirus Disease (COVID-19) was declared as pandemic by the World Health Organization (WHO)1. The rise of COVID 19 cases in India, has also led the Central Government to respond by issuing nationwide lockdown orders commencing 25 March 20202 under the National Disaster Management Act 2005 ('DM Act'), inter alia restricting the movement of human resources as well as closure of private and commercial establishments (save those specifically exempted by guidelines issued by the Ministry of Home Affairs)3, until 15 April 2020. The impact of the closure of establishments nationwide can be seen on both the organized as well as unorganized employment sectors.
Following the orders made by the Central Government and for aiding the implementation of measures announced at the Centre, the State Governments have also notified orders, under the Epidemic Diseases Act 1897 ('ED Act') read with the DM Act, including measures in respect of termination and reduction of wages. We have seen orders from the State of Telangana4 and Karnataka5. While for the other States we have seen, circulars and advisories, for example the States of Maharashtra6 and New Delhi7. We have in recent weeks also seen, that the Ministry of Labour and Employment, Government of India has issued various advisories to both workers' organizations and employers' organizations with a view to contain the spread of COVID-19 and to ensure that the rights of employees and workers remain protected, in these unprecedented times. Similar advisories are also emerging from other Ministries, such as from the Ministry of Skill Development and Entrepreneurship8.
Notification/Circulars - Advisories
Work during Lockdown: Depending on the sector, whether organized or unorganized, and on the nature of the industry, employers can ask employees to work from home. Further, in relation to establishments which are completely non-operational due to COVID -19, the employees of such units will be deemed to be on duty, per the circular issued by the Central Government to employers associations9. There is a similar advisory from the State of New Delhi, Ministry of Health and Family Welfare10.
Salaries and Wages: Employees working from home as well as employees/workers who are unable to work from home owing to the sector of employment and nature of industry, are entitled to full salary for the duration of the lockdown. The circular issued by the Central Government in this regard, issued to all industries, shops and establishments discouraged reduction of salary and/or wages, as such reduction is likely to impact the financial situation of the individual concerned11.
Termination: The Central Government, has advised all the employers of public/private establishments to extend their coordination by not terminating their employees, particularly casual or contractual workers during this period12.
Leave: In relation to establishments which are completely non-operational due to COVID-19, the employees of such units are to be deemed to be on duty, and, therefore, no deduction should be made from the entitled leave accrued13.
Employees Provident Funds (Amendment) Scheme 2020
In view of the on-going COIVD-19 epidemic, the Finance Minister has announced a series of financial and regulatory reliefs to companies and individuals, including proposed amendments to the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 ('EPF Act') to permit a non-refundable withdrawal from the provident fund of an individual.
Subsequently, on 27 March 2020, the Ministry of Labour and Employment has notified the Employees Provident Funds (Amendment) Scheme, 202014 ('Scheme') which has been made effective from 28 March 2020. The Scheme permits any member or employee in any establishment or factory located in an area declared as affected by outbreak of any epidemic or pandemic, to withdraw a non-refundable advance from the provident fund account of such member. The limit prescribed by the Scheme for withdrawal is up to three months basic wage and dearness allowance or up to 75% amount available in the member's account, whichever is less.
The orders, circulars and office memorandums, discussed above, are not only aimed at combating the spread of the COVID-19, but also aimed at achieving some extent of financial stability. It must be noted that the orders issued by the Central Government and State Government have been issued under the DM Act and ED Act, the violation of which will attract a penalty, including imprisonment up to two years or fine (or both) under the DM Act and imprisonment up to six months or fine or both under the ED Act. However, the circulars issued by different Ministries for integrating national plans and policies and aiding implementation at a State level, as on date, are in the form of directives and advisories, the enforceability of which still remains to be tested.
However, given the unprecedented nature of circumstances facing all nations globally, restraint in movement and providing support to our work force in all manners possible does seem to be the need of the hour. With time as it becomes more likely that the lockdown orders will be extended further, it remains to be seen if more specific legislative measures will be adopted by the Government of India, in relation to employment. Striking a balance between the rights of employees vis-a-vis the rights of employers has always been, and continues to remain a critical matter, especially in light of the current unprecedented circumstances.
2 Order No. 1-29/2020-pp (Pt II), National Disaster Management Authority, Policy and Plan Division available at https://mha.gov.in/sites/default/files/ndma%20order%20copy.pdf
3 Annexure to Order No. 40-3/2020-D dated () 24.03.2020 available at https://mha.gov.in/sites/default/files/Guidelines.pdf; https://mha.gov.in/sites/default/files/PR_ConsolidatedGuidelinesofMHA_28032020.pdf; https://mha.gov.in/sites/default/files/MHA%20order%20with%20addendum%20to%20Guidelines%20Dated%2024.3.2020.pdf
4 GO. MS. No. 45, General Administration Department, Government of Telangana
5 No. HFW 54 CGM 2020, Government of Karnataka
6 DO. No. Secy (MCA)/COVID/19/1/2020, Ministry of Corporate Affairs and Directions by Labour Commissioner
7 No. F. 51/DGHS/PH-IV/COVID-19/2020/M/prsecyhfw, Government of National Capital Territory of Delhi
8 Office Memorandum, O.M. No. MSDE -1(3)/2020AP(PMU), Ministry of Ministry of Skill Development and Entrepreneurship
9 DO No. M-11011/08/2020-Media dated 20 March 2020, Ministry of Labour and Employment
10 Advisory No. F. 51/DGHS/PH-IV/COVID-19/2020/prsecyhfw/2718-32
11 DO No. M-11011/08/2020-Media dated 20 March 2020, Ministry of Labour and Employment
12 DO No. M-11011/08/2020-Media dated 20 March 2020, Ministry of Labour and Employment
13 DO No. M-11011/08/2020-Media dated 20 March 2020, Ministry of Labour and Employment
14 Notification No. F. No. S-35012/01/2020-SS-ii(Pt.), Ministry of Labour and Employment
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