Supreme Court Gives Big relief to Private Businesses

In a Big relief to private Businesses, the Supreme Court on Friday said no coercive action could be taken against companies who fail to pay full wages to workers during the lockdown that has been used to restrain the spread of covid-19.

The courts asked employers and employees to negotiate wage. The bench observed both labourers and the industry need one another and should make attempts to solve the dispute mutually.

The court gave a ton of instructions to countries labor departments to facilitate these discussions. State government’s must facilitate, initiate the process of reimbursement and submit a comprehensive report to the labor commissioners regarding this.

The Center was given four weeks to file its response on the Question of legality and validity of the home ministry’s 29 March notification that “all employers” need to pay full salaries to their workers throughout the lockdown period.

The notification had stated employers, be it at the Business or from the shops and industrial establishments, will make payment of wages of their employees at their work places, on the due date, with no deduction, for the time their establishments are within closure through the lockdown.

The decision was pronounced by a three-judge chair containing Justice Ashok Bhushan, SK Kaul and MR Shah on a batch of petitions filed with more than 15 micro, small and medium enterprises (MSMEs) from the Centre’s order.

On 4th June, the court had granted interim protection to private Companies and stated no other recourse action will be taken against them.

Attorney overall KK Venugopal had apprised the bench the 29 March telling was a temporary measure. Since folks migrated in crores, the notification was to reevaluate their suffering and stop the workers from leaving, Venugopal added.

The top court said, “Your notification forced the payment of 100% of wages… It can be approximately 50 to 75%. So that the question is, have you got the capacity to receive them to cover 100%, and due to their failure to do so, prosecute them”

The bench had detected that some discussions must be held to find solutions, after negotiations with industries, and government should perform the role of facilitator.

The request filed with the MSMEs, challenging the 20 March Advisory from the labor ministry and 29 March notification by the home ministry, stated they should be permitted to cover the employees 70% less.

The petitioners stated their business was struck due to the Lockdown and being made to pay employees in total caused intense financial and psychological stress on them.