SALARY DEDUCTION DURING COVID 19?

Is reduction in salary infringement of right to property?

The discussion is being made on the ordinance which the government has brought during an extraordinary situation which have occurred world wide i.e Coronavirus disease (COVID-19). The Kerala high court refuses to stay an ordinance the government brought. The Ordinance basically deals with an aim to make deductions in employee’s salaries as part of efforts to raise funds for fighting the Coronavirus disease. As the court agreed to the government’s contention that it has legislative powers to bring such an ordinance during an extraordinary situation and posted the matter for further hearings. The application for the dedication of salaries will be done on the employees of all state-owned enterprises, public sector undertaking, quasi-government organisation and universities and among other.  The state is expecting to collect Rs. 2000 crore through this move which will help them to increase the revenue of the state.

The Kerala high court agreed to the government’s contention that it has legislative powers to bring such an ordinance of deductions in employee’s salaries as part of efforts to raise funds for fighting during an extraordinary situation and posted the matter for further hearings on June 4. Kerala brought the ordinance on April 30, a day after the single bench of the high court stayed the government’s decision to deduct salaries of employees for six days every month for the next five months (totalling 30 days). The move will be applicable for the employees of all state-owned enterprises,  public sector undertaking, quasi-government organisation and universities and among other. Hearing a bunch of petitions questioning the ordinance, the government said its move cannot be called a salary cut, and added that it was a deferment of payment in the time of a crisis. The state reiterated its contention that this amount will be paid once the fiscal condition of the state improved. The state is expected to collect Rs 2000 crore through this move. Employees organizations owing allegiance to the opposition parties said they will approach the Supreme Court soon.

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Article 300A of the constitution of India.

Right to Property is no longer a fundamental right, rather it is a Constitutional Right and now exists in Article 300A.

Article 300A states that – No person shall be deprived of his property save by the authority of law.

Article 309 of Constitution of India

“Recruitment and conditions of service of persons serving the Union or a State” Subject to the provisions of this Constitution, Acts of the appropriate Legislature may regulate the recruitment, and conditions of service of persons appointed, to public services and posts in connection with the affairs of the Union or of any State.

Article 21 of the Constitution of India.

Provides that, “No person shall be deprived of his life or personal liberty except according to procedure established by law.” ‘Life’ in Article 21 of the Constitution is not merely the physical act of breathing. It does not connote mere animal existence or continued drudgery through life. It has a much wider meaning which includes right to live with human dignity, right to livelihood, right to health, right to pollution free air, etc.

Article 75(b)1 and 89 of Kerala financial code vol.1

Rule 2(26), 12(23), 22,22A and 22B of Chapter 3 of part 1 of Kerala Service Rules.

 

Epidemic Disease Act no. 3 of 1897 (as amended in 2020) with specific reference to Section 2.

 

Disaster Management Act of 2005 with specific reference to section 38 and 39.

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All over the world, the efforts of the State Government are being lauded. Every corner of the state is being taken care of the government.

Several Crores of rupees are being spent by the State. However laudable and appreciable the acts of the state may be, when this Court is called upon to decide a matter affecting the vested rights of citizens, the Court cannot ignore the legal framework.

Article 300A will include within its purview ‘salary’ also, as a property, at least prima facie. Kerala Financial Code is only dealing with the procedure for payment of salary. The submission of Advocate General that government has the power to delay the disbursement of the payment of salary by an executive order cannot be countenanced. However much I tried to bring the impugned order within some framework of law, I could not find any basis for such any order in any of the statutes. Neither in the Epidemic Diseases Act as amended by 2020 Ordinance, or in the Disaster Management Act could I seek solace to justify issuance of the order.

The government order is only postponing the payment of salary, and there was no deprivation of the same. There is no provision of law which states that there should be payment of salary on a particular day, AG added. The condition that salary should be paid on a particular day is from the Financial Code, a government order. That can be altered by another government order. The top law officer of the State then referred to the provisions of Disaster Management Act 2005 and the Epidemic Disease Act 1897 and Kerala Epidemic Disease Ordinance 2020 to state that the government was wide power of appropriate funds for disaster management.

It can further be highlighted that the state government was reeling under severe financial crisis due to COVID-19 pandemic and the lockdown. More than 50% of the revenue receipts are used for the payment of salary. COVID-19 has put huge burden on the resources of the state. Rs 5000 crores were spent last month in relation to COVID-19.

Establishment of the Contingency Fund of Kerala.- (1) There shall be established a Contingency Fund in the nature of an imp-rest entitled “The Contingency Fund of the State of Kerala” and consisting of a sum of[One hundred crores of rupees] withdrawn from the Consolidated Fund of the State of Kerala.

(2)Such contingency Fund shall be held on behalf of the Governor of Kerala by the Secretary to the Government of Kerala in the Department of Finance and the Governor shall have authority to make advances therefrom for the purpose of meeting any unforeseen expenditure pending authorisation of such expenditure by the State Legislature by law under Article 205 or Article 206 of the Constitution.

(3)As often as any such expenditure is authorised by law as aforesaid, the Government shall recoup to the Contingency Fund an amount equal to the advance taken from such Fund to meet the expenditure.

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The Employee & Compensation Act, 1923 / Power of the State Government to make Rules.

(1) The 167 State Government may make rules 168 to carry out the purposes of this Act.

(2) In particular and without prejudice to the generality of the foregoing power, such rules may provide for all or any of the following matters, namely:

(a) for prescribing the intervals at which and the conditions subject to which an application for review may be made under section 6 when not accompanied by a medical certificate.

(b) for prescribing the intervals at which and the conditions subject to, which a 169 employee may be required to submit himself for medical examination under sub-section (1) of section 11.

(c) for prescribing the procedure to be followed by Commissioners in the disposal of cases under this Act and by the parties in such cases.

(d) For regulating the transfer of matters and cases from one Commissioner to another and the transfer of money in such cases.

(e) For prescribing the manner in which money in the hands of a Commissioner may be invested.

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Decision is still pending in Supreme Court.

For case specific advice, please contact service matter expert Lawyers, Advocate in Chandigarh Panchkula Mohali for Salary Recovery issues from Employer.

This post is written by Sneha.

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