The Hon’ble High Court of Bombay vide order dated 13.07.2020 held that the order passed by the Union Ministry of Home Affairs under the Disaster management Act 2005, directing all States and Union Territories to ensure timely payments to workers by their respective employers without any deductions during the COVID-19 lockdown was not applicable to those workers who were unpaid and unemployed prior to the said lockdown.

The said order was passed in response to a writ petition (LDVC-59 of 2020) filed by Premier Employees Union, a trade union registered under the Trade Unions Act, 1926 representing the interest of about 200 workers of M/s. Premier Limited, seeking directions from the Hon’ble High Court to the State of Maharashtra and Commissioner of Labour to ensure that workers of M/s. Premier Limited are paid wages for the duration of the lockdown in terms of order of Ministry of Home Affairs, Government of India dated 29.03.2020; order of Department of Industries, Energy and Labour, Government of Maharashtra dated 31.03.2020; and order dated 20.03.2020 passed by the Industrial Court, Maharashtra at Pune in Complaint (ULP) No.32 of 2020 (Premier Employees Union Vs. M/s. Premier Limited).

It was further prayed to direct the District Collector, Pune and Deputy Commissioner of Police, Pimpri-Chinchwad to initiate appropriate proceedings against M/s. Premier Limited under the Disaster Management Act, 2005 for failure to comply with the government orders.

The present order was also passed taking together the former writ petition along with another writ petition (LD-VC-57 of 2020) filed by M/s. Premier Limited questioning the legality of the order dated 20.03.2020 passed by the Industrial Court, Maharashtra at Pune.

M/s. Premier Limited had obtained an NOC (Non Objection Certificate) from the office of Commissioner of Labour, Maharashtra for shifting of its plant from the original site. The NOC was conditional in as much as the company had to give an undertaking that it would make full payment of wages and dues to the workmen and ensure continuity of their employment.

It was thereby contended by the Premier Employees Union that the said company had not paid wages and dues to the workmen since May, 2019 and that Management also did not make any payment towards the legal dues, such as, Employers’ Provident Fund contribution, gratuity of retired employees and renewal payment of Mediclaim Insurance Premium.

As per the Union, the said company had vide notice dated 03.03.2020 stated that the management had decided to suspend operations with immediate effect until further notice / orders in respect of the workmen and staff and it was then that the Premier Employees Union filed a complaint before the Industrial Court against the said company. Consequently, the Industrial Court directed the company to pay wages to its workmen w.e.f. 01.03.2020 on or before the tenth day of each month.

M/s. Premier Limited filed a writ petition (LD-VC-57 of 2020) questioning the legality of the order passed by the Industrial Court and argued that it was because of non-cooperation and “obstructionist approach” of the union, that certain customers withdrew their orders thereby causing heavy loss of business and earnings of the company. Therefore, to ensure that manufacturing activities were carried on smoothly, the company took loans from several banks amounting to Rs. 330 crores. As of March, 2020, the company had outstanding dues of Rs. 417 crores. That apart, the company also owed Rs. 95 crores to other creditors and for payment of employee related dues.

The Company further submitted that Edelweiss Asset Reconstruction Company was engaged for revival of the company and after the factory land was sold, wages until May 2019 were paid to the workers. Moreover it was contended that, since the parties were locked in an industrial adjudication for a cause of action which arose much prior to the lockdown, neither the MHA order dated 29.03.2020 nor the government resolution dated 31.03.2020 of the Government of Maharashtra would be applicable to the claims of the workmen.

After taking note of the merits of both the matters, the Coram comprising of Justices Ujjal Bhuyan and Riyaz I. Chagla stated that to be deemed to be on duty and to be entitled to or for continuity of salary / wages during the lockdown one should actually be on duty and receive the payment on the day the lockdown was declared.

Calling the order passed by the Industrial Court dated 20.03.2020 as contradictory in nature, the Hon’ble High Court held as follows, “But what should be the nature of the interim order? It is an admitted position that the workmen have not been paid wages post May, 2019. Since their employment has not been disturbed because even as per the management the notice dated 03.03.2020 has only declared suspension of operations, the workmen cannot be left in the lurch.”

The Industrial Court’s order was therefore modified and the workmen were ordered to be paid 50% wages.

Order:BOMBAY HC ORDER