Umakanthan53
Labour Law & Hr Consultant
Bhartiya Akhil
Freelancer
KK!HR
Management Consultancy
Rajesh Kumar Dubey
Manager - Hr

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Sir am working in one hydraulic pump and valve manufacturing company, now company announced lay-off and present we are working more than 150 members per day and company deducted our basic salary and day allowance, other allowance and efficiency incentive and turnover incentive. The company laid-off only for 39 members but in 25M act says if there is below 50 members laid off the company have pay 100% of salary to laid off workmen ???
From India, Ernakulam
To clarify the legal position, Section 25M is not providing for payment of 100% wages for the Lay Off period but Section 25M mandates Governmental permission before lay off is effected. Chapter VB would apply as there are more than hundred workman in all and lay off compensation (50% wages and allowances) is payable.
From India, Mumbai
Dear Naveena-Naveen,
I would like to just add to what KK!HR said.
This compensation is not payable beyond 45 day in preceding 12 months. That means the maximum compensation would be for 45 days only.
Further, after the expiry of 45 days of the lay off your employer can retrench your service in accordance with the provisions contained in section 25F. In that case, the compensation paid to you, your employer may set off it against the compensation payable for retrenchments.

From India, Mumbai
Sorry, my dear Bhartiya Akhil, that I am afraid whether your above comments are correct with a conjunctive reading of the provisions of Chapters V-A and V-B of the IDA,1947 pertaining to Lay-off.

Since the poster's establishment is a factory having more than 100 employees on its rolls ( under an educated guess of not less than 100 on an average per working day for the preceding 12 months), it comes under Chapter V-B and as such the employer ought to have applied for prior permission to lay-off any number of their workmen u/s 25-M(1) from the appropriate Government.

The blatant failure on the part of the employer to do so renders the entire lay-off illegal and therefore entitles the workmen so laid-off to all the benefits under law including full wages as if they had been not laid-off as per the provisions of section 25-M(8).

Coming to your views about retrenchment in the wake of 45 days of lay-off, it is applicable only to industrial establishments falling under the purview of Chapter V-A alone. A conscious reading of the entire section 25-C of chapter V-A together with its two provisos would bring out that such acts of limiting the lay-off compensation to the first 45 days of lay-off and resorting to retrenchment afterwards are not automatic or discretionary but subject to the subsistence of an agreement to that effect between the workman and the employer.

Therefore, such relaxations in respect of lay-off compensation and retrenchment as well are not available to the poster's establishment as it clearly falls under chapter V-B of the IDA,1947.

From India, Salem
Dear Umakanthan Sir,
As per above narration and advice given in this, what option are available with employer if orders are not being received from market and production activity can not be possible now . It is very difficult to pay even 50% salary ie lay off compensation further,
pls advice
Regards
Rajesh Dubey / Uttar Pradesh

From India
Dear Rajesh,
In my opinion, the reasons mentioned in sec. 2(kkk) of the IDA, 1947 for lay-off are specific, exhaustive and not illustrative.
Certain things like forecasting the business prospects, planning staffing pattern and employing innovative methods of operations are purely managerial responsibilities. Always it is not enough to work but to perform consistently by effectively harnessing the factors of production would be a positive sign of marching forward in the long run.
Therefore, you should always watch the demand side of the market and decide your ability to supply by adopting an appropriate mix of regular and outsourced labor. If you blindly chase the demand in a volatile market, the situation like the one you described would be inevitable.

From India, Salem
Dear Umakanthan Sir,
Thanks for correcting me. I obliged.
I made a gross mistake in applying my mind to both the sections in over confidence. During those days I do not have any bare Act with me and try to post without referring to any Act.

From India, Mumbai
That's alright, Akhil, nobody is infallible. Whenever interpretation of complicated legal provisions is undertaken, we should have a thorough reading, at times several re-readings so as to arrive at a holistic point of view of any concept occurring in various parts of the same statute.
There are certain web-sites like advocates.com ( if I remember the name correct ) posting bare Acts. You can utilize them.

From India, Salem
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