Businesses seek clarity over MHA’s order on payment of wages

Confusion and ambiguity marked the country’s business establishments even as the Ministry of Home Affairs (MHA) issued an order yesterday, revoking its earlier March 29 guideline under which employers had been directed to pay full wages to all their workers.

“Save as otherwise provided in the guidelines annexed to this order, all order issued by the NEC [national executive committee] under Section 10(2)(I) of the Disaster Management (DM) Act, 2005, shall cease to have effect from 18.05.2020.” the MHA guideline read.

Several businesses said that the order lacks clarity and it is yet to be ascertained whether the order stands withdrawn effective from May 18 or in totality. “In case it is withdrawn from 18 and consequently applicable till May 17, it will bring little relief as businesses will have to pay for the period that they were shut and earnings were almost nil,” Anil Bhardwaj, secretary general, Federation of Indian Micro and Small and Medium Enterprises (Fisme) told IN.

Bhardwaj also said that a lot will depend on the state governments as they have the final authority for execution.

Federation of Indian Export Organizations (FIEO) president Sharad Kumar Saraf echoed the same sentiment. “It is ambiguous and the order should have just simply be withdrawn, in any case the matter is pending in Supreme Court,” Saraf said.

After many companies moved the Supreme Court against the MHA’s March 29 order, the apex court stayed the order asking businesses to pay full wages to their workers. The apex court also directed the Centre not to take any punitive action against non-payment.

According to the March 29 order all employers, be it in industry or in shops and commercial establishments, were mandated to pay wages to their workers on the due date, without any deduction, even if their establishments were closed during the lockdown. The Centre further asked the state governments to take required action in case of any violation.

The order also said, “wherever the workers, including the migrants, are living in rented accommodation, the landlords of those properties shall not demand payment of rent for a period of one month. If any landlord is forcing laborers and students to vacate the premises, they will be liable for action under the Act.”

Prime Minister Narendra Modi announced a nationwide lockdown from March 25 in order to fight the spread of the novel coronavirus..