As the world of work undergoes drastic changes due to the sudden outbreak of the Coronavirus, there are so many questions pertaining to the legal implications of some actions that employers might take due to the COVID-19 crisis. Should they reduce salaries or withhold bonuses? Can they retrench employees? Should they provide pay to their employees if they are unable to come (or prohibited from coming) to work due to the COVID-19 outbreak? There are many questions like these that have a legal implication and must be answered by legal experts.
People Matters in collaboration with Economic Law Practice (ELP) brings to you this weekly FAQ series that addresses the many employment-related issues that employers are facing in the wake of the COVID-19 coronavirus.
In this weekly series, we have created a Frequently Asked Questions (FAQ) document, which will be posted every Friday and will be continuously updated with frequently asked questions by employers and employees.
In this second part of the weekly series, experts from ELP, Tushar Ajinkya, Partner & Ashish Prasad, Partner, address the most frequently asked questions around workforce management.
Q1. What industries fall under essential services?
The Government vide its Order No. 40-3/2020-DM-I (A) dated 24.03.2020) and the subsequent addendums dated 25.03.2020, 27.03.2020 and 02.04.2020) allowed industries providing essential services to operate amidst the lock-down. The following industries are allowed to operate:
- Healthcare/medical services through hospitals and related medical establishments, including their manufacturing and distribution units, both in public and private sector such as dispensaries, chemists and medical equipment shops, laboratories, clinics, nursing homes. Ambulance etc., including transportation for all medical personnel, nurses, para-medical staff and other hospital support services;
- Banking, insurance and ATM services;
- Print and electronic media;
- Telecommunications, internet services, broadcasting and cable services. IT and IT enable services only for essential services and as far as possible with work from home;
- Delivery/supply of essential goods, including food, pharmaceuticals, medical equipment through e-commerce;
- Restaurants supplying home delivery of cooked food items;
- Power generation, transmission and distribution units, and services;
- Petrol pumps, LPG, Petroleum and gas retail, and storage outlets
- Capital and debt market services as notified by the Securities Exchange Board of India (SEBI);
- Cold storage, warehousing services and other facilities for storage of essential goods. Warehousing facilities having both essential and non-essential goods can continue to operate;
- Private security services
- Agencies engaged in the procurement of agriculture products, including MSP operations.
- Data and call centers for Government activities only.
- Coal and mineral production, transportation, the supply of explosives and activities incidental to mining operations.
- Manufacturing units of packaging material for food items, drugs, pharmaceuticals, and medical devices.
- Manufacturing and packaging units of Fertilizers, Pesticides, and Seeds
In addition to the above, kindly note that in respect of hospitality services,
- Hotels, homestays, lodges and motels, which are accommodating tourists and persons stranded due to lockdown, medical and emergency staff, air and sea crew; and
- Establishments used/earmarked for quarantine facilities are exempted from the applicability of the Government Order and can accordingly continue to operate.
- Certain important industries have also been allowed to operate with the prior permission of state government.
Q2. What precautions does the employer need to take in respect to those employees who are reporting to work for companies in essential services?
In terms of the order dated 19.03.2020 by Ministry of Labour and Employment (No. Z-11025/1/2020-LC) the employer must ensure the following precautions are taken with respect to the employees:
- To make sure that the workplaces are clean and hygienic. Ensure proper cleaning and frequent sanitization of the workplace, particularly of the frequently touched surfaces. Surfaces (e.g. Desks and tables) and objects (e.g. telephones, keyboards) need to be wiped with disinfectant regularly.
- To ensure regular supply of hand sanitizers, soap and running water in the washrooms.
- To promote regular and thorough hand-washing by employees, contractors, and customers. Keep sanitizing hand rub dispensers in prominent places around the workplace. Make sure these dispensers are regularly refiled.
- Display posters promoting respiratory hygiene. Combine this with other communication channels commonly used in the organization or business.
- The employer must brief staff, contractors and customers about the spreading of COVID-19, and anyone with mild cough or low- grade fever (37.3 C or more) needs to stay at home. Hygiene and physical distancing (1 mtrs.) should be encouraged. Must avoid shaking hands and hugging as a matter of greeting.
- Meetings, as far as feasible, may be done through video conferences. Minimize or reschedule meetings involving large number of people unless necessary. Non-essential official travel may be avoided.
- All employees/workers may be advised to take care of their own health and look out for respiratory symptoms/fever. If feeling unwell, they may be advised to leave the workplace immediately and observe home-quarantine as per the guidelines issued by the Ministry of Health and Family Welfare.
- Advise all staff who are at higher risk i.e., older employees, pregnant employees and employees who have underlying medical conditions, to take extra precautions. It may be ensured that such employees are not exposed to any front-line work requiring direct contact with the public.
Q3. Are there any advisories released for organizations on managing work and talent post lockdown?
No. The Central and State Governments have not yet issued advisories regarding the management of work and talent post the lockdown.
Q4. Are provisions of the Disaster Management Act, 2005 and Epidemic Diseases Act 1897 empowered to govern the relationship between employer and employee?
The Industrial Disputes Act, 1947 and the respective State Shops and Establishments Act govern the relationship between an employer and employee i.e. workman and non-workman respectively.
The Disaster Management Act, 2005 and the Epidemic Diseases Act, 1897 are specific legislations, the provisions of which are applicable in the exigent circumstances of a disaster and an epidemic respectively. Notably, as per Section 72, the provisions Disaster Management Act, 2005 have an overriding effect, notwithstanding any inconsistency or conflict with any other law. Both acts do not govern the relationship between the employer and employee however if directives are issued with an objective of curtaining the spread of disaster/epidemic such circular will be binding. Recently, the Hon’ble Supreme Court in the matter of ALAKH ALOK SRIVASTAVA VS UNION OF INDIA on 31.03.2020 while considering the plight of thousands of migrant labourers' referred to various circulars Issued by MHA (including the circular dated 29.03.2020 which directed the employers to pay the full wages to migrant workers) and observed that:-
"We trust and expect that all concerned viz., State Governments, Public Authorities and Citizens of this country will faithfully comply with the directives, advisories and orders issued by the Union of India in letter and spirit in the interest of public safety".
Q5. Is the employer bound to pay for the period of lockdown?
Yes. Till the nationwide lockdown remains in effect, i.e. Order No. 40-3/2020- DM-I dated 24.03.2020, the Government of India has directed all the employers to pay the wages to their workers on the due date without any deduction.
Q6. If an employer pays for the lockdown period and employee/ worker extends his leave beyond the lockdown period, then what should an organization do?
Once the lockdown period is over, organisations may take steps under the applicable statutes and contracts to deal with the absence. These could range from the deduction in leave entitlement or leave without pay or other remedies as per the organizations policies.
However, despite notice, if an employee refuses to join work, steps can be taken as per the Industrial Disputes Act 1947, and for non-workmen as per the terms of the appointment letter/ employment contract agreed between the employer and the employee.