Employment Issues During COVID-19 Crisis: An Analysis of the MHA’s Order

Abstract

The COVID-19 crisis, declared as a pandemic by the Director General of WHO on 11.03.2020, in addition to having a significant and highly disastrous impact on the lives of people world over, has had and will continue to have an apparent and heavy influence on all industries, globally. Even in the most automated industries, people are at the fulcrum and so when contemplating cost-cutting, to stay afloat on such troubled waters, companies find it an inevitable step to cut down on their manpower, either in the form of job cuts or more prevalently, salary / wage reductions. However, at the same time, there is also a necessity to ensure protection for these personnel during these tough times while also equally safeguarding and balancing the interests of both the company and the employees.

In this context, the Indian Government has taken the initiative through the recent Ministry of Home Affairs (“MHA”) Order dated 29.03.2020, among other notifications/guidelines issued by other departments, stating that employers are required to pay full wages to all workers, the non-compliance of which would attract penal consequences. The said order has been recently challenged before the Supreme Court, in which matter the Trade Unions have also sought to be impleaded, and which Order has also been challenged by another petition as well; however, the Supreme Court for the interim has not provided any stay and has sought for the Government’s response on the said Order. In the meanwhile, the Central Government has extended the lockdown till the 17th of May, 2020, continuing the effect of the Order dated 29.03.2020. Further, penal consequences are also being enforced against employers for non-compliance of the said Order. Therefore, considering the fact that the Supreme Court has not granted stay over the said Order, this article seeks to analyse the Order’s impact in the context of the prevailing labour laws in India, while also considering whether the Order can be said to be all encompassing in its application, without delving into the grounds such as arbitrariness, unreasonableness, amongst others, which have been raised in the Petitions.

Keywords: Covid-19, Labour Laws, Employment, Employer, Employee, Worker, Wages, Ministry of Home Affairs

JEL Classification: K00, K19, K29, K30, K31, K41, K42