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Salary is a legal, not moral obligation: CITU leader

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By NS Desk 13-Apr-2020

Chennai, April 13 (IANS) The mere thought of adjusting Corporate Social Responsibility (CSR) funds for payment of salaries/wages during the lockdown period is nothing but "Corporate Anti-Social Irresponsiblity", said a labour leader.

"Salary or wage is a legal obligation. There is nothing like moral obligation for payment of salaries/wages. Further, for corporates, the wage cost will come to about 8 per cent only," A. Soundararajan, President, Tamil Nadu unit of Centre of Indian Trade Unions (CITU) told IANS.

Soundararajan said the companies are also saving their power and other costs.

He was reacting to the clarifications issued by the Ministry of Corporate Affairs (MCA) where it said: "Payment of salary/ wages in normal circumstances is a contractual and statutory obligation of the company. Similarly, payment of salaries/wages to employees and workers even during the lockdown period is a moral obligation of the employers, as they have no alternative source of employment or livelihood during this period."

The MCA has clarified that payment of salaries/wages during lockdown period shall not qualify as admissible expenditure under CSR.

According to Soundararajan, the thought of adjusting CSR funds for wages should not have come at all.

"If CSR funds are used for wages, then the company has not spent anything as CSR," he said.

Soundararajan said that only about 20 days has passed since the lockdown was imposed and it is strange that the industry lobby bodies are claiming that their members are incurring huge losses.

To the question whether the lockdown period could be adjusted against earned leave of the employees, Soundararajan said, "Such things should not be done as the lockdown was not the making of the workers or that of the company. Nevertheless, these aspects should be discussed between the management and the unions."

According to him, big companies can easily absorb the production loss that happened during the lockdown.

Soundararajan said the government should pass an order saying wages should be paid to workers -- permanent/temporary/casual -- for the lockdown period.

"The CSR funds cannot be used for payment of salaries. We have paid our staff full salaries for March and will be paying for April as well. We hope operations would start from May onwards and there will be cash flows," Alok Aggarwal, Managing Director, National Trust Housing Finance Ltd, told IANS.

"We are also asking our landlords to take a cut in their rent," he added.

Speaking to IANS, N. Krishnamurthy, a city-based interior decorator who does works for major banks, said: "I have paid full salaries to my 40 workers for the month of March and in April salaries will also be paid in full. Yes, business has been affected, but that is different."

--IANS

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