31 March, 2020
We hope you are well and staying safe.
To deal with the ever changing COVID-19 situation in India, the central and the state governments are issuing notifications, orders, regulations, guidelines and advisories on a regular basis. The key developments as on March 30, 2020, 2:00 p.m. (IST) have been set out below:
A. The Finance Minister’s speech:
The Finance Minister, Ms. Nirmala Sitharaman, on March 26, 2020, addressed the nation and announced a relief package of INR 1.70 Lac Crore, under the Pradhan Mantri Garib Kalyan Yojana, especially for the under privileged and poor population of the country. The key takeaways from the speech are set out below:
1. Benefits for the Organized Sector:
(i) The Government of India to contribute both, the employer’s and employee’s share of the provident fund contributions for the next 3 months, in respect of the establishments/organizations having up to 100 workers, where a majority of the employees draw a monthly salary of INR 15,000 or less.
(ii) The Employees’ Provident Fund Scheme, 1952 has been amended to include pandemic as a reason to allow withdrawal up to 75% of the non-refundable advance standing to the credit of the employees in the provident fund accounts or 3 months basic wages and dearness allowance, whichever is lower. The relevant notification can be accessed here
2. Building and Other Construction Workers: Directions to the state governments to utilize the amounts accumulated in the building and other construction workers welfare fund for providing relief and economic support to the workers in light of the Covid -19 crisis.
3. Special Insurance Scheme: Medical insurance cover of INR 50 Lacs (per person) for every medical professional, health worker including inter alia nurses, doctors, technicians, paramedics, cleaning staff, ASHA workers, sanitation workers etc.
4. District Mineral Fund: Directions to the state governments for utilization of the district mineral fund to enable medical testing, screening and other requirements to cope with the spread of Covid-19 and treatment in relation to the same.
B. Clarifications to the nationwide lockdown guidelines:
Following the issuance of the guidelines and the addendums to it by the Ministry of Home Affairs last week, the Home Secretary of Government of India through his letter, dated March 29, 2020, to the Chief Secretaries of all States has issued certain clarifications. As per the clarifications:
1. Transportations of all goods, without distinction of essential and non-essential to be allowed;
2. ‘Pension’ under exemptions to clause 2(g) to include pension and provident fund services provided by the EPFO;
3. Clause 3 to include services of Indian Red Cross Society;
4. Groceries to include hygiene products such as sanitary pads, diapers, shampoos etc.;
5. Entire supply chain of milk collection and distribution, including its packaging to be allowed; and
6. Print media to include newspaper delivery supply chain.
Through this letter, the Centre has allowed the usage of State Disaster Response Fund (SDRF) for homeless people including migrant labourers, stranded due to lockdown measures and sheltered in the relief camps and other places.
C. Migrant workers:
The Ministry of Home Affairs, Government of India, issued an order dated March 29, 2020 (“Order”), to strictly implement the lockdown measures and to mitigate the economic hardship of the migrant workers. The key preventive measures stated in the Order are set out below:
1. Provision for migrant labourers: The State/ Union Territory Governments are required to ensure adequate arrangements of temporary shelters and provision of food for the poor and needy migrant labourers, stranded due to lockdown measures in their respective areas.
2. Provision of quarantine facilities: The State / Union Territory Governments are required to make provisions for quarantine facilities as shelter for all the migrant workers who have moved out to reach their home states/towns. This should be ensured post proper screening of at least 14 days, as per the standard health protocol.
3. Payment of wages: The employers of both, the industry and shops & commercial establishments are required to pay wages to all their workers. Such payments are required to be made on the due date, without any deductions for the period of lockdown of such establishment.
4. No demand for payment of rent: The Order provides that none of the workers, including the migrant workers, living in rented accommodation, will be required to pay rent to their landlords. This exemption will be valid for a period of 1 month. Further, if the labourers or students are forced to vacate their premises, such action will be penalized under the Disaster Management Act, 2005 (“Act”).
Non-compliance or violation of any of the measures provided in the Order will be punishable in accordance with the provisions of the Act.
We have prepared FAQs for the employers for coping with the Covid-19 situation, which is available here. In addition to this, we also have a dedicated resource page for Covid-19 related updates and development, which is accessible here.
For further information, please contact:
Zia Mody, Partner, AZB & Partners
zia.mody@azbpartners.com
