Section 2(kkk) of the Industrial Dispute Act, 1947 defines layoff as “lay-off (with its grammatical variations and cognate expressions) means the –
Failure, refusal or inability of an employer
On account of a shortage of coal, power or raw materials or the accumulation of stocks or the breakdown of machinery or natural calamity or of any other connected reasons
To give employment to a workman whose name is borne on the muster rolls of his industrial establishment and who has not been retrenched.
Financial stringency is not a cause for which a lay-off could be given. So any reason arising out of a financial crisis that is result of the current pandemic is absolutely irrelevant and it is not a reason for which layoff can be legally given. This fact has been substantiated by the honorable Madhya Pradesh High Court in the case of Hope Textiles Ltd vs State Of Madhya Pradesh.