Centre's order on full wages to be paid during lockdown: SC reserve verdict

The Supreme Court on Thursday reserved its verdict on pleas challenging Centre's March 29 order asking employers to pay full wages to employees for the lockdown period. 

A bench of Justices Ashok Bhushan, S K Kaul and M R Shah reserved the verdict on a batch of petitions filed by various companies challenging the circular of the Ministry of Home Affairs issued on March 29 asking the employers to pay full wages to the employees during the nationwide lockdown due to the coronavirus pandemic.

The Centre informed the Supreme Court that it's March 29 notification on full payment of wages to workers by their employers during the lockdown was not unconstitutional, instead, it was a measure taken to prevent the perpetration of financial crisis within the lower strata of the society, labourers and salaried employees.

Meanwhile, the apex court asked the parties to file their written submissions in support of their claims.

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The Centre, in the affidavit, said, March 29 was not a permanent measure, and it has already been withdrawn. "It is further emphasised and reiterated that the said directions (March 29 order) were issued by Union of India as a temporary measure to mitigate the financial hardship of the employees and workers especially contractual and casual during the lockdown period", said the Centre.

The MHA said the direction for payment of wages was in the public interest and was taken by the National Executive Committee under the pertinent provisions of the Disaster Management Act. Therefore, the National Executive Committee had full competence to issue the order.

The Centre also filed an affidavit justifying its March 29 direction saying that the employers claiming incapacity in paying salaries must be directed to furnish their audited balance sheets and accounts in the court.

The affidavit filed by the government has said that no material has been placed on record to establish the contentions raised in the petitions that employers are not in a financial position to pay their employees and workers.

It said that petitions have raised grounds of "financial hardship, incapacity or lack of desire" of the employers to pay their employees or workers during the lockdown without taking work from them.

"It is respectfully submitted that this ground of financial incapacity is a legally untenable ground to challenge a direction issued by the competent authority in exercise of its statutory power," the affidavit said.

Scores of firms from across the states moved the apex court challenging the March 29 order, which obligated employers to pay full wages to their workers during the period of the lockdown. The industries have challenged the MHA on the source of power to pass such directions and highlighted that financial burden cannot be put on the private firms when the companies are shut during the lockdown.

The apex court had in March asked the government not to resort to any coercive action against private companies who have not paid their workers full wages during the lockdown in accordance with a government order in March. The court had indicated that payment of full wages, as directed by the Ministry of Home Affairs (MHA) in an order on March 29, may not be viable for small and private enterprises, which themselves are tottering on the brink of insolvency due to the lockdown.