SC Says No Coercive Action Against Employers In Two Pleas Challenging MHA Order On Full Payment Of Wages; No Interim Order In Connected Cases

The Supreme Court on Friday issued notice to the Central Government on a batch of petitions challenging the direction passed by the Union Ministry of Home Affairs on March 29 directing employers to pay full wages to workers without deduction during lockdown.

However, in two case, the bench issued an interim order restraining coercive action against the employer for a period of one week for non-payment of wages as per MHA direction.

"No coercive action shall be taken in the meantime", ordered a bench of Justices L Nageswara Rao, Sanjay Kishen Kaul and B R Gavai while issuing notice to Centre returnable within a week in the writ petition filed by Hand Tools Manufacturers Association(petition and order appended below). Similar order against coercive action was passed in a writ petition filed by Indian Jute Mills Association as well.

At the same time, the same bench did not pass any interim order and issued notices returnable next week in the similar petitions filed by Ficus Pax Private Ltd, Ludhiana Hand Tools Association, The Twin City Industrial Employers Association, Rajasthan Steel Chamber, Instruments and Chemicals Private Ltd and others, Chamber of Small Industry Association and others, Kerala State Small Industries Association, Federation of Industries and Association, All India Federation of Master Printers, Teknomin Construction Limited and Garments Exports Manufacturing Association and others.

While the petition filed by Hand Tools Manufacturers Association(in which interim order was passed) was listed as item number 9 before the bench, the other cases were listed as items 25 and 27 to 35.

All these petitions challenged the order issued by Home Secretary on March 29 invoking powers under Section 10(2)(l) of the Disaster Management Act 2005, which directed as follows :

"All the employees, be it in the Industry or in the shops and commercial establishments, shall make payment of wages of their workers, at their work places, on the due date, without any deduction, for the period their establishments are under closure during the lockdown"

The MHA direction was challenged as unreasonable and arbitrary and as violative of the fundamental right to trade and business of the employers. Since operations are completely shut down during the lockdown, it is impossible for the employers to continue to bear the burden of full salary of employees, the petitioners submitted.

The petitioners also raised the argument that the impugned direction was beyond the scope of powers conferred under the Disaster Management Act.

"Interpreting Section 10(2)(l) of the Disaster Management Act 2005 as conferring power on the Central Government to direct Private Establishment to make full payment of wages to the employees during the lockdown period is arbitrary and violative of Articles 14, 19(1)(g) and 300A of the Constitution of India", said one of the pleas.

[LiveLaw had earlier reported that the SC had restrained coercive action on the MHA order. This was based on the inputs in the 'Hand Tools Manufacturers Case'. However, there arose a confusion in the light of reports that no interim order was passed in the connected cases. In this backdrop, LiveLaw had taken down the previous report to avoid further misunderstanding. This report is published after getting clarity on the matter from the orders uploaded in the SC site. The confusion caused earlier is deeply regretted]

Click here to download the Order in 'Hand Tools Manufacturers Case' (where there is interim order)

Click here to download the petition filed by 'Hand Tools Manufacturers Case'

Click here to download the Order in 'Indian Jute Mills Association Case' (where there is interim order)

Cases in which only notice was issued :

Click here to download the Order in Ficus Pax case

Click here to download the Order in Ludhiana Hand Tools case

Click here to download Order in Rajasthan Steel Chamber

Click here to download the Order in Instruments and Chemicals Pvt Ltd Case

Click here to download the Order in NCR Chamber of Commerce and Industry

Click here to download the Order in Teknomin Construction Industry

Click here to download the Order in Garments Exports Manufacturing Association and others

Click here to download the Order in Kerala State Small Industries Association

Click here to download the Order in the Federation of Industries and Association

Click here to download the Order in the All India Federation of Master Printers

Read Order