In Brief
During the COVID-19 pandemic, Andhra Pradesh deferred employee salaries and pensions citing fiscal crisis. A retired judge challenged this by writ petition, and the High Court ordered payment of deferred dues with 12% interest, holding that statutory entitlements cannot be unilaterally deferred without legislation. The Supreme Court upheld the deferment was unlawful but reduced interest from 12% to 6% per annum on simple basis, confined to specific employee categories and all pensioners. The Court held salaries and pensions are statutory rights under Articles 21 and 300A, though reduced the interest rate as reasonable compensation rather than punishment."
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