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Saving Jobs and Averting Lay-offs amidst COVID-19 Lockdown
Despite unleashing a slew of relief measures, the state is grappling to ensure that employers abstain from imposing lay-offs, pay cuts or unpaid leave during the lockdown. Even if the state mandates employers to pay wages without any lay-offs, then, in this context, there is a need to advocate for wider coverage of labour legislation in India. In the short run, fixing accountability on employers for wages and jobs will provide an interim relief, but, in the long run, we need to take financial viability into consideration and provide stimulus wage subsidy.
The author would like to thank the anonymous referee for their valuable comments.
The outbreak of coronavirus (COVID-19) has caused a full-blown health emergency leading to rising death tolls, and disrupted trade, mobility, and livelihood of millions of workers around the world. The looming pandemic threatens to disproportionately hit not only the health security in the short term, but also cause a devastating social and economic crisis over the months and years to come in developing countries. The magnitude of its impact shows multiplier effects when it is accompanied by a complete social and economic shutdown through several channels such as weakening of domestic demand, disruption in supply chain, decline in production, and job losses.
As the fifth largest economy, India’s nationwide lockdown, the biggest in the world, will be lifted sooner or later. However, the uncertainly of livelihood, wage loss and lay-offs is likely to linger much longer. The lockdown has not only inflicted incorrigible damages on the working lives of migrant, informal and precarious workers, but has induced a slump in activities of all sectors, from production to distribution to consumption. In order to subside its impact on labour markets, a soft law approach has been executed through an advisory from Ministry of Labour and Employment on 20 March 2020 requiring all employers/establishments not to terminate employees and not to cut wages of the workers, including contract and temporary workers (MOLE 2020).
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