SC Verdict: To low the financial pain during COVID 19.

Drasti Jain, Government Law College, Mumbai

Ficus Pax Private Limited vs Union of India

Was this Judgement sufficient in disburdening the financial pain, faced by lower and middle-income households during COVID 19.


This judgment was passed on June 12, 2020, by the Supreme Court of India. The matter was concerning the petitions filed by private companies challenging the Ministry of Home Affairs order dated March 29, 2020, which required employers to pay full wages to the workers for the lockdown period.

What was the judgment of the Court in the present case?

The Apex Court passed an order in the present case encompassing the interim directions to be facilitated by the relevant state authorities as follows:

  1. The employers are willing to enter into negotiation and settlement with the workers or employees regarding payment of wages for the 50 Days Period, or for such period (as applicable in a particular state) during which their industrial establishment(s) was closed down due to the lockdown. They may initiate a process of negotiation with their employees' organization and enter into a settlement with them. If they are unable to settle by themselves, a request may be submitted to the concerned labour authorities (which is statutorily prescribed for the same), on the date specified by the labour authorities. This settlement can be acted upon by both the employers and workers, irrespective of the Ministry of Home Affairs Order.

  2. Those employers' establishments, industries, factories or such which have or had been working during the lockdown period, although not to their full capacity, can also take steps as indicated above in point (i)

  3. The employers who proceed to take the abovementioned step shall publicize, communicate and inform their workers and employees about the steps they are taking to get their response or participation. Such a settlement would be without prejudice to the rights of employers and employees pending adjudication in the writ petitions.

  4. The employers shall permit their workers and/or employees (who are willing to work) to work in their establishment, without prejudice to the rights of the workers and/or employees regarding unpaid wages of the 50 Days Period.

  5. The central and state or union territories governments are required to circulate and publicize the Apex Court's order for the benefit of all employers and workers and/or employees, to ensure the respective stakeholders know of the Court’s decision with regards to the same.

Has this judgment been sufficient to woe the problems of the people of India?

The Government in the present case has imposed an unreasonable expectation on the employers. The businesses and their nature have been treated as one entity instead of individual organisations, each with their own nature, differences in consistency of financial returns from operations and the subsequent impact of the pandemic on their functioning. Instead of a tailored approach, a one – size fits all approach has been undertaken, without delving into the various types and nature of organisations, formal or informal and such existing. The interim directions issued by the Apex Court have given an option to employers, whose businesses may have taken a commercial hit due to the lockdown. While there is a social obligation on the employers to mitigate financial hardships and ensure continued sustenance of its workers and/or employees during the pandemic, the government also has a corresponding responsibility towards the society.

It is assumed and hoped for that during the course of the settlement (as directed by the Apex Court stated in point ii), the parties would now be in a better position to come to an agreement giving due consideration to the industry or establishment-specific practical issues involved. This can help strengthen the relationship between employer and employee while giving an amicable and easy route to the problem of wages. Any understanding reached mutually will be legal and held to be fair.

Moreover, the direction to permit the willing employees and/or workers to work in the establishments, without prejudice to their rights regarding the payment of wages for the 50 Days Period, (Point iv of the directions stated above) would lead to a possible continuation of employment instead of large scale sacking of the employees that have been undertaken in the early stage of lockdown. This can also prove helpful to gradually revive both the industry and the economy now that the lockdown restrictions have been eased in various places and states.

What could the Supreme Court have done?

In a situation as grave as the global COVID-19 Pandemic, the citizens of this country look up to the Supreme Court to ensure the protection of their rights and to ensure the values of Justice, Liberty and Equality are maintained as directed by the Preamble of the Constitution.

It is highly unfair to transfer the burden of ensuring wage safety of the workers and employees to private establishments who are themselves struggling to survive in this lockdown.

The Hon’ble Supreme Court could have very well actively performed its role to ensure reliefs to the private establishments who do not have the responsibility to pay off full wages to the workers, despite suffering losses in their respective businesses. This would have ensured that the businesses are able to sustain themselves in spite of not operating. Additionally, a long term perspective needs to be undertaken, wherein the operations of the businesses need to ensure after the lockdown is over, for that aid needs to be provided to them to survive the duration of the lockdown. The Apex Court could have issued directions to the government to announce aid or subsidies or schemes or loans for the wages of the workers and employees. The pertinent question of law with respect to the Article 14 and 19(1)(g) of The Indian Constitution, that has been brought up due to the passing of the Ministry of Home Affairs order has so far remained unanswered.

The order does not state what will happen in case the employer does not comply with the interim order and fails to pay the wages of the employees for the period in question, in the petition. As the hearing of the case is suspended till the last week of July, to give the Government four weeks’ time to merely come up with representation on the case, it is estimated that the result achieved before the next date of the hearing may determine what the Apex Court finally decides. It is yet to be seen whether the Apex Court will address the issue of non-payment of wages as being non-compliance or not. Until then the businesses are left in an arbitrary position.

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