Note Regarding Deduction of Wages for Absence During Lock-Down

Ministry of Home Affairs, Government of India, issued Government Order dated March 29, 2020, bearing No.40-3/2020-DM-I(A) under section 10(2)(I) of the Disaster Management Act, 2005. Vide the said Government Order, all private employers, be it in the industry or in shops and commercial establishments, were directed to 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 lockdown.

Government of Maharashtra in pursuance of the Government Order dated March 29, 2020, vide another order dated March 31, 2020 issued u/s 24 of the Disaster Management Act, 2005, directed all private establishments not to terminate any workman including temporary/contract workmen and pay wages for the period of lockdown even if any workman has not performed / attended work.

Several private Organizations or Association of Employers have approached the Supreme Court as well as various High Courts challenging the validity of the said Government Orders in view of the said Orders being manifestly arbitrary. Organisations also reported that workers were deliberately evading work and still expecting payment of full wages in view of the said Government Orders.

One such Petition Challenging Government Orders dated March 29, 2020 was filed in Align Components Pvt. Ltd., and another Vs. Union of India and others (Writ Petition Stamp No.10569 of 2020) before the High Court of Judicature of Bombay Bench at Aurangabad. A bench comprising of Justice Ravindra V. Ghughe refused to interfere with the said Order as the matter was already being heard by the Hon’ble Supreme Court. However, the bench addressed two vital issues with regard to the said Order.

  • Firstly, the Bench observed that though employers have been directed to pay full wages, however employers could deduct conveyance allowance and food allowance, if being paid on month to month basis in the cases of those workers who are not required to report for duties.
  • Secondly, in case of workers required to report to duty, if any worker voluntarily remains absent, the Management would be at liberty to deduct his/her wages for such absence subject to the procedure laid down in law while initiating such action.

Such an observation is vital as workers not reporting to work and expecting full wages in view of the Government Orders, is nothing but the misuse of legislative order for wrongful gain. What our Country is facing today is an unprecedented crisis. If every stake-holder i.e. employers, employees, consumers and the government do not work together in unison to restore normalcy, it may lead to closure of Organizations especially those running on marginal profits. Needless to say, such an impact would not only be detrimental for the economy but would also lead to mass unemployment.