Is It Fair to Apply "No Work, No Pay" During Maintenance Shutdowns? Seeking Advice

During a strike and unauthorized absenteeism, we implement the "No Work, No Pay" rule. However, during Shutdown Holidays (for maintenance and erection work), will the "No Work, No Pay" rule be applicable? If the employer decides not to pay salaries to employees during the shutdown holidays, is this correct?

Thank you in advance.

The "No work no pay" pertains to the payment of wages, and this right of the employer is applicable when there is "NO WORK" on the part of the employees. The same is mentioned in the Payment of Wages Act, 1936. In the matter of shutdown holidays, it cannot be considered in the same manner because employees have no role to play in such holiday conditions. Definitely, if such activities are of a prolonged period, you can explore the option of layoff according to the provisions of the law.

Regards,
Raj Kumar Rai

The "No work no pay" pertains to the payment of wages, and this right of the employer is applicable when there is "NO WORK" on the part of the employees. The same is mentioned in the Payment of Wages Act, 1936.

Shutdown Holidays and Employee Payment

In the matter of shutdown holidays, it cannot be considered in the same manner because employees have no role to play in such holiday conditions. If such activities are of a prolonged period, you can explore the option of layoff according to the provisions of the law.

Regards,
Raj Kumar Rai

Dear Naveen, The options available are to schedule your maintenance work during long weekends or holidays. If you are unable to do so, you can ask them to work on a compensatory basis on some other holiday. Alternatively, you can adjust the leave standing to the credit of employees after informing them.

Handling Bandhs and Political Strikes

Please note that in the event of Bandhs announced by political parties, the same situation arises. The working of the establishment gets affected due to the paralysis of transport. Do we pay for these days? Certainly not; it is either NO WORK NO PAY or working on a compensatory basis. Employer associations clearly send out circulars advising employers about the stand taken by them on the above lines.

Trust the matter is clear.

Regards,
M.V. KANNAN

Inquiry on Case Laws and Collective Bargaining Agreements

Are there any case laws regarding employees being unable to work due to third parties—neither employees nor employers—and what should be done in such situations? Are there any provisions in collective bargaining agreements between trade unions/employee representatives and management to protect pay in such scenarios that anyone knows?

Regards.

Dear HR people, what happens to the loss during maintenance because of the machine being down? Where is that loss accounted for, similar to the overhead you are bearing to pay off salaries during maintenance? This means the cost of maintenance includes the cost of labor (no work but still pay).

Different Situations and Their Implications

Here, three different situations are arising:

• Strike - Firstly, whether it is a legal or illegal strike by the employees/workers, and secondly, the strike caused by outsiders - political or others, etc.

• Unauthorized absenteeism by employees.

• Shutdown Holidays (Maintenance work and erection work).

Case 1: Strike

If the strike is illegal and hence invalid, then the "No work and No pay" theorem is straightforwardly applicable. However, for a legal/valid strike under the light of the ID Act, the same theorem might not be applicable. Before applying this theorem, an analysis of the case on several grounds is required; otherwise, the decision may be challenged in court.

Case 2: Unauthorized Absenteeism

As it is simple and straightforward, the theorem is directly applicable, i.e., "No work and No pay," since it is non-compliance with the rules and regulations and appears as a disobedience.

Case 3: Shutdown Holidays

The shutdown due to maintenance of machines, etc., is initiated by the employer or management and is part of the yearly activities. Hence, the theorem is not applicable, but there will be 'No work but paid.' If the shutdown is for a prolonged period, then an alternative choice before the employer or management is to do a "lay off." Please note that the shutdown is not the retrenchment or termination of the contract or employment.

I believe it is clear.

Regards,
Rama Kant

Application of the "No Work, No Pay" Rule

The "No Work, No Pay" rule can be applied only in cases of absenteeism, strikes, etc., where the absence is due to the actions of the workmen/employee. However, if the company decides to shut down for a definite period for maintenance work, the "No Work, No Pay" rule should not be applied, as the workmen/employee are willing to work.

Regards,
Vinay D.
AGM - HR
Bombay Stock Exchange Limited, Mumbai

Morally, ethically, and legally, it is not right for the employer to deduct the amount.

Regards, Surendra Verma

Lay-Off Compensation and Legal Requirements

Workmen can be laid off by virtue of Section 25C of the Industrial Disputes Act, 1947, with lay-off compensation paid at 50% of the total of the basic wages and D.A. Subject to employment strength ranging between 50 to 100, Chapter V-A applies; for more than 100, Chapter V-B applies, where permission of the appropriate government has to be taken mandatorily. This applies when an employer is unable to provide work to their workmen due to machinery failure, lack of raw materials, etc.

Regards,
Kiran Kale

Hi all,

I need one clarification. Right now, as there is no production/orders, one reputed company is not paying salary to their workers with the "no work, no pay" policy. Can anyone clarify on which act/clause basis they may not be paying?

It's helpful for us in the future if there is no production.

Awaiting your suggestions.

Regards,
Chandan.