Lockdown 4.0 & Employer Obligations to Pay Wages During the Lockdown

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In continuation of its efforts to cope with the COVID – 19 outbreak in India, the Government of India, through the Ministry of Home Affairs (“MHA“) has extended the nation-wide lockdown to May 31, 2020. With what appears to be an intent to gradually ease out the lockdown, the MHA issued guidelines dated May 17, 2020 (“New Guidelines”), that provide further relaxations to the public and businesses. The New Guidelines bring to an end certain orders, notifications, and guidelines that were issued by the MHA, under its powers under the Disaster Management Act.

Along with a brief summary of the New Guidelines, we have set out below certain key developments, since our previous update:

A.     LOCKDOWN 4.0  

1.     The New Guidelines are to be in effect from May 18, 2020 up to May 31, 2020.

2.     All activities that are not specifically prohibited under the New Guidelines are now permitted. Additionally, States and Union Territories have been permitted to specifically prohibit activities, in the manner they deem necessary, to contain the spread of COVID -19.

3.     Activities that are prohibited throughout the country include:

a.     All domestic and international air travel, except for medical services and security purposes;

b.     Metro rail services;

c.     Schools, colleges and other educational institutions; and

d.    Hotels, restaurants and other hospitality services, other than those used for housing health/police/government officials/health care workers, stranded persons, or providing quarantine facilities.

4.     Zone Categorisation:

a.    States and Union Territories have been permitted to categorise areas as red, green and orange zones, by taking into consideration the parameters shared by the Ministry of Health and Family Welfare.

b.     District authorities are permitted to demarcate areas as containment zones and buffer zones, within red and orange zones. A buffer zone is an area that requires additional and focused attention so as to ensure that COVID – 19 does not spread to adjoining areas.

5.     Activities that are permitted in all zones, except in the Containment zone include:

a.     Inter-state movement of passenger vehicles and buses, with mutual consent of the States/or Union Territories; and

b.     Intra-state movement of passenger vehicles and buses, as decided by the States and Union Territories;

The New Guidelines also provide that the Standard Operating Procedures issued by the MHA for movement of persons would continue to operate.

6.     Activities that are permitted in the Containment Zone:

a.     Essential activities to be allowed; and

b.     Persons will be permitted to enter or exit a containment zone only for medical emergencies and to ensure the supply of essential goods and services.

7.     National Directives for COVID-19 management at workplace, include:

a.     That the practice of work from home to be followed, as far as possible;

b.     Mandatory wearing of masks in the work place;

c.     Social distancing through staggered lunch breaks, and adequate gaps between shifts;

d.     Provision for thermal screening, hand wash and sanitizers at all entry and exit points and common areas;

e.     Frequent sanitization of the workplace; and

f.     Staggering of work/business hours to be followed in offices, work places, shops, markets and industrial & commercial establishments.

8.     Night Curfew: The movement of individuals for non-essential activities is strictly prohibited between 7 p.m. to 7 a.m.

9.     Use of Aarogya Setu: The New Guidelines provide that employers, on a best efforts basis, are to ensure that employees who have compatible mobile phones install the application. The previously issued guidelines mandated employers to mandatorily ensure that their employees download the Aarogya Setu mobile application..

B.     EMPLOYER OBLIGATIONS TO PAY WAGES DURING THE LOCKDOWN

1.    The New Guidelines issued by the MHA have ceased the operation of certain orders that were issued by the MHA, which include order dated March 29, 2020 that prohibits employers from reducing the wages, for the period during which their establishments are closed due to the lockdown. This would mean that, with effect from May 18, 2020, unless prevented by any other order/notification by the state or central governments, there does not seem to be a restriction on employers reducing the wages of their employees in accordance with applicable law and the terms of their employment contract.

2.     The Supreme Court, on May 15, 2020 heard a batch of similar petitions that have challenged the Central Government’s order of March 29, 2020 and advisory of March 20, 2020, on payment of wages to workers during the COVID-19 lockdown. The Central Government has been issued a one weeks’ notice in all the cases. The Supreme Court, in two cases, passed an interim order in two matters stating that no coercive action will be taken against the employers for a period of one week for failing to pay wages to its employees.

Date:May 18, 2020