The Hon’ble Supreme Court in Ficus Pax Private Ltd. & Ors Vs. Union of India & Ors has categorically enunciated that no industry would survive without its workers and thus gave the option to the establishments and the workers to negotiate on the full payment of wages, regardless of the order of the Ministry of Home Affairs (“MHA”).
In the present case, several Writ petitions were filed by different employers, employers’ associations challenging the orders made under the Disaster Management Act, 2005 and other consequential orders that mandated the payment of wages to employees without any deduction for the period of lockdown. In a few writ petitions, directions were sought to subsidize 70% to 80 % of the wages for the lockdown period by utilizing the funds collected by Employee State Insurance Corporation or the PM Cares Fund or through any other Government funds/schemes.
The Petitioner contended that the notifications were arbitrary, illegal and irrational and violated Article 14, 19 (1) (g) of the Constitution and the principle of Equal Work Equal Pay. They also contended that the Central Government has the power to allocate funds for emergency response or relief and that the onus was on them to provide compensation. Union of India in its counter affidavit contended that the orders passed under the Disaster Management Act, 2005, have been withdrawn and that the right to wages was a pre-existing right from the contract of employment as well as broader constitutional and statutory scheme flowing from Article 14 and 21 of the Constitution and encompassing Payment of wages Act, Minimum Wages Act, The Contract labour (Regulation and abolition) Act and the Industrial Disputes Act, 1947.
The Hon’ble Court viewed that the issues were to be decided together and directed the MHA to effectuate a date for conciliation and settlement and also directed the settlement to be publicized for the benefit of all employers and workers. Further, the Court directed the State governments to facilitate such settlements and initiate this process and to submit reports before the labor commissioner. The Court also permitted the workers to work if they were willing to, notwithstanding the disputes regarding wages. Thus, the matter is now posted for the last week of July.
Digital Contracts and Execution of Contracts Amidst COVID-19 “Novel Corona Virus” or “COVID-19” has not only resulted in a loss of lives but has also