1998 (2) TMI 586 - SC - Indian Laws

Summary

Issues Involved:
1. Legality of termination of services under Clause 17(g) of the Certified Standing Orders.
2. Whether the termination amounted to "retrenchment" under Section 2(00) of the Industrial Disputes Act.

Summary:

1. Legality of Termination under Clause 17(g):
Respondent 1, a permanent employee, was terminated by the petitioner for overstaying leave without permission, invoking Clause 17(g) of the Certified Standing Orders. The Industrial Tribunal and the High Court held that the termination was illegal as it did not provide an opportunity of hearing to the respondent, violating principles of natural justice. The Supreme Court affirmed this view, stating that Clause 17(g) confers discretion on the management to terminate services, which must be exercised objectively and fairly, ensuring the employee is given an opportunity to explain the reasons for overstaying leave.

2. Termination as "Retrenchment" u/s 2(00) of the Industrial Disputes Act:
The Tribunal and the High Court found that the termination amounted to "retrenchment" as defined u/s 2(00) of the Industrial Disputes Act, since it was not a result of disciplinary action, voluntary retirement, superannuation, non-renewal of a fixed-term contract, or continued ill-health. The Supreme Court upheld this finding, noting that the respondent was a permanent employee without a fixed-term contract, and thus, the termination did not fall under the exceptions listed in Clause (bb) of Section 2(00). Consequently, the statutory provisions, particularly those in Section 25F, were applicable, and their non-compliance rendered the termination invalid.

Conclusion:
The Supreme Court dismissed the petition, affirming the decisions of the Industrial Tribunal and the High Court that the termination was illegal and amounted to "retrenchment," entitling the respondent to reinstatement and back wages.