The Indian Government issued a 21 days lockdown order for the entire country around a week ago. This resulted in closure of all establishments except the ones which provide essential services. Many employees are not able to work especially in the manufacturing sector. To protect the interest of the employees, the Ministry of Home Affairs issued an order on 29-Mar, 2020, an abstract of which is below:
"All the employers, 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"
This applies to all types of employees whether permanent or temporary. Many employees have questions about their employment during this time.
Q. Can my employer terminate my employment during this lockdown?
Most states have either issued orders mandating employers not to terminate the employees (including contract workers/outsourced workers) during the lockdown. Hence, employers cannot terminate the employees wherever there is a mandatory order.
Q. Can my employer terminate my employment once the lockdown is over?
If you fall under the definition of a workman in the Industrial Disputes Act, 1947 and have in continuous service for not less than a year, retrenchment (termination) has to be done as per the procedures laid down in the ID Act which includes giving retrenchment notice to the employee, compensation equivalent to 15 days of pay for every year of completed service and employer also needs to send a notice of retrenchment to Regulatory Authority. This applies to all workman whether they work in a factory or an office.
For factories who employ more than 100 (check for state amendments on the employee thresholds defined), retrenchment unless the State government approves such retrenchment. The retrenchment procedure, in such cases, require 90 days of notice to the employee and compensation equivalent to 15 days of pay for every year of completed service.
Q. Who is a workman?
"All the employers, 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"
This applies to all types of employees whether permanent or temporary. Many employees have questions about their employment during this time.
Q. Can my employer terminate my employment during this lockdown?
Most states have either issued orders mandating employers not to terminate the employees (including contract workers/outsourced workers) during the lockdown. Hence, employers cannot terminate the employees wherever there is a mandatory order.
Q. Can my employer terminate my employment once the lockdown is over?
If you fall under the definition of a workman in the Industrial Disputes Act, 1947 and have in continuous service for not less than a year, retrenchment (termination) has to be done as per the procedures laid down in the ID Act which includes giving retrenchment notice to the employee, compensation equivalent to 15 days of pay for every year of completed service and employer also needs to send a notice of retrenchment to Regulatory Authority. This applies to all workman whether they work in a factory or an office.
For factories who employ more than 100 (check for state amendments on the employee thresholds defined), retrenchment unless the State government approves such retrenchment. The retrenchment procedure, in such cases, require 90 days of notice to the employee and compensation equivalent to 15 days of pay for every year of completed service.
Q. Who is a workman?
"workman"
means any person (including an apprentice) employed in any industry to
do any manual, unskilled, skilled, technical, operational, clerical or
supervisory work for hire or reward. However, it excludes a person who
is employed mainly in a managerial or administrative capacity. Also if someone who works in a supervisory capacity and draws a
salary of more than Rs.10,000/- is excluded from the definition of a
workman.
The Apex Court and different High Courts in the
country have time and again said that one is not to be guided by the salary
drawn by a particular person but the main criteria to determine whether that
person is a workman, is to take into consideration the nature of work rendered
by him in the industry. The test to decide whether an employee is a
workman or not is to take into account his/her primary duties and dominant
purpose of his employment. An incidental performance of supervisory duty will
not make the character of the employment supervisory.
Q. My company provides services? Will Industrial Dispute Act be relevant for me?
It is a common perception that Industrial dispute Act applies primarily to the manufacturing organizations. The term industry is very widely defined in the ID Act. Industry is defined as business, trade, undertaking, manufacture, or calling of employers and includes any calling, service, employment, handicraft or industrial occupation or avocation of workmen. It includes almost all types of establishments.
Q. What is my remedy if an employer terminates my employment illegally?
You can send a legal notice to the employer for reinstatement with back wages. You can also file a case in the Labor Court or the Civil court. Also the government has set up region-wise labour control rooms for employees to lodge their grievance during the covid lockdown.
Q. Can my employer force me to resign?
Your employer cannot force you to resign.You have a right to not resign. Termination is a long process and usually, employers try to avoid it.
Q. Can my employer stop from paying my salary?
There are various notifications by the Centre and the States to employers to not to deduct the salary of employees. The employer cannot deduct your salary till the lockdown.
Post the lockdown: Employers cannot hold the salary without the consent of the employees. They have the option to terminate an employee. For termination procedure, see above.
Note: You may post any query that you have in the comments section.
Q. My company provides services? Will Industrial Dispute Act be relevant for me?
It is a common perception that Industrial dispute Act applies primarily to the manufacturing organizations. The term industry is very widely defined in the ID Act. Industry is defined as business, trade, undertaking, manufacture, or calling of employers and includes any calling, service, employment, handicraft or industrial occupation or avocation of workmen. It includes almost all types of establishments.
Q. What is my remedy if an employer terminates my employment illegally?
You can send a legal notice to the employer for reinstatement with back wages. You can also file a case in the Labor Court or the Civil court. Also the government has set up region-wise labour control rooms for employees to lodge their grievance during the covid lockdown.
Q. Can my employer force me to resign?
Your employer cannot force you to resign.You have a right to not resign. Termination is a long process and usually, employers try to avoid it.
Q. Can my employer stop from paying my salary?
There are various notifications by the Centre and the States to employers to not to deduct the salary of employees. The employer cannot deduct your salary till the lockdown.
Post the lockdown: Employers cannot hold the salary without the consent of the employees. They have the option to terminate an employee. For termination procedure, see above.
Disclaimer: The above is for guidance purpose only. Consult a qualified legal practitioner for legal opinion.
Hi, First of all thanks for wonderful insights provided. I heard that few organizations in Bangalore are asking people to leave; it may be a layoff or retrenchment. Is it legal to do so? I couldn't find any articles regarding the same from the Government or Labour Department. Not able to verify the authenticity of these information. And what about IT companies, are they also restricted from laying off people? I am quite sure not all companies will come forward and say they are laying off due to COVID19. They can come up with many other reasons as well.
ReplyDeleteLayoff or termination is illegal during the lockdown. The Ministry of Home Affairs has issued an order (29-Mar) under the Disaster Management Act,2005 directing employers to not terminate any worker during the lockdown. It applies to all companies - see the order - https://mha.gov.in/notifications/circulars-covid-19. They cannot lay off during this period unless it is for misconduct - for which they have to conduct an investigation and follow the procedure for disciplinary proceedings. It is unlikely that companies will be able to prove that mass layoffs were for reasons other than COVID19.
DeleteFrom what I understand all the rules the mha has passed is under the provisions of the disaster management act. It does not empower them to pass laws about employment in anyway so the guideline cannot be enforced nor can employers be prosecuted for violation. Other than for any violation of existing labour laws. Can you clarify this
DeleteDisaster Management Act has overriding powers over other regulations - Section 72 empowers the government. The employers can be prosecuted for violation.
DeleteHi, Thanks for sharing valuable inputs. What about companies who don't have any revenues now? Say any companies in the travel domain like airlines, they will have zero revenue and it would be tough for them to pay salary to employees? Equally it would be tough for anyone who looses job or resigns from a company as it would be tough to get another job. Sorry I have too many questions, I tried to collect the laws around retrenchment/ lay off during these days, but couldn't find any. Even the document in the MHA site doesn't clearly say anything. As you know organizations use various terminologies like retrenchment, forced resignation, lay off etc. How can an employee ensure his/her right for job is protected?
ReplyDeleteCompany will not have zero revenue - Companies may incur losses. Has the company filed for insolvency? It is difficult time for companies as well as employees. However, companies who are in there for the long haul will innovate to keep their employee. Retrenchment is termination of employment while layoff is a temporary measure of where the employee is not terminated but she is laid off temporarily for 45 days. Post 45 days, the employer can retrench (terminate) the employment. However, during the lockdown, the Govt. has issued orders to pay the salary in full.
ReplyDeleteRefer the FAQ section for retrenchment procedure.
Hi
ReplyDeleteI am working in Mumbai in Software support domain since last 3 year.
Now, due to Corona virus disease, I am in my home.
But as I am in support department I am supporting to our clients on phone calls.
Now my Team leader and management is saying you just arrange laptop or pc for WFH otherwise company will not pay you salary.
Now what should I do .
Somebody plz help me out
You send a mail from your phone to your Company to arrange for a laptop or PC as you cannot do it because (1) The company is supposed to arrange it;and (2) even if could arrange it (and claim the cost from the company later), you cannot do it due to the current lockdown. Support the company from your phone mail/phone as much as you can but the company cannot force you to arrange for a laptop. You need to send a mail documenting that you are willing to work and can support from your phone but the company has to arrange for a laptop/PC for work which cannot be done on phone.
DeleteHi
ReplyDeleteThanks for sharing this vaulable I formation , I am iitjee teacher in coaching which is runninng in a school in ghaziabad . I regined on 14march 2020 ,and according to the bond I have to serve 1 month notice period but on 7 april I came to know that I was relieved on 31 March without informing me or even dropped a acknowledgement mail to me .they have have my original documents and now they denying to let me serve the notice period .
What are the options before me in this suitation , please tell me
The institute cannot force you to resign. If you have resigned, you are entitled to the payment for entire notice period or salary in lieu of the notice period. Send a legal notice to them (even an email will do) - 1. to pay for your remaining notice period and 2) to release your original documents. You can take legal action - you can write to the Ministry of Labour as employers cannot force employees to resign during lockdown, file a complaint to the Labour Court.Also if the employer is holding your original documents, you can file a criminal complaint.
DeleteCan my employer stop from paying my salary in lockdown?
ReplyDeleteIf company will not pay us for the mentioned day as per Delhi govt. then which step should be take to get action on that company... please let me know.
No, your employer cannot stop payment of your salary during the lockdown. You can mail to the Labour Ministry/Delhi Labour Dept or file a complaint with the Labour Court. You can also tweet on the Labour Ministry tweet handle.
DeleteHi,
ReplyDeleteI recieved offer letter 20-nov-2019 from HCL. According to HCL I Resign previous job serve notice period. As per mentioned joining dated on 16 Dec2019. I gone to HCL as per joining date for joining, I show my name on them list for joining but HR asked me your joining today postpone due to verification issues and inform ed you 4/5 days. After some time HR dropped mail to inform me. your case has dual employment means you are working two companies same times. Pls me justification...
I answer properly justify given to HR. Now he is not onboarding yet? I have already touched with HR. But there is no response them. Now this time is critical. I m jobless last 4 months.
Please suggest me.
I work with Labat Asia Pvt ltd Mohali, the MD of the company asked us to work more in April and we all worked very hard for company but on 1st May he wrote a letter for salary cut upto 50% and also salary delays. Can he asked us further to go leave without pay.
ReplyDeleteThey cannot do a salary cut or ask you to go on leave without pay during the lockdown period.
Delete1. You can register your complaint with the control room in your region set up by the labour Ministry.
2. Send a legal notice to your employer.
3. Approach FITE https://fite.org.in/contact-us/ . They are an association for the IT/ITes employees and can help you, in case you cannot afford a lawyer.
Hi there,
ReplyDeleteI am working in Daman (UT)from Aug. 2018 in Automotive Tier-1 Industry. Recently, on 4th June I received a mail from my employer stated that I have been terminated from the company due to Covid-19 and on this company is not paying my dues before the notice period and also the notice period is of 30 days but in my appointment letter it is stated that if we (Employee) leaves/resigns then he/she must have to serve a notice period of 60 days.So, what steps or say what are my rights against this action?
Hi
ReplyDeleteMyself Manoj Shekhawat teacher of maths in a Institute which is pvt.ltd in Rajasthan.. My Institute don't give me my March salary and after lockdown 25 may they fire me without any prior notice... What should I do. Please help me