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Issues Involved:
1. Determination of the rate of overtime allowance admissible to employees. 2. Interpretation of Sec. 14 and Sec. 31 of The Tamil Nadu Shops and Establishments Act, 1947. Summary: Issue 1: Determination of the rate of overtime allowance admissible to employees The core question raised in these appeals by special leave is the rate of overtime allowance admissible to the employees of the appellants working in their establishments situated in Tamil Nadu. M/s Philips India Ltd. had an establishment in Tamil Nadu governed by The Tamil Nadu Shops and Establishments Act, 1947, and followed a practice where employees rendered service for 39 hours a week. The company introduced the rate of overtime payment at 1-1/2 times the ordinary wages for work done over 39 hours per week, subject to the condition that whenever the total working hours exceeded 8 hours per day or 48 hours per week, employees were entitled to overtime at twice the ordinary wages as mandated by Sec. 31 of the Act. Similarly, State Bank of India paid overtime allowance at the rate awarded by the National Industrial Tribunal (Desai Award), which fixed working hours at 36-1/2 per week and directed overtime allowance at 1-1/2 times the wages for every quarter of an hour of overtime work. Issue 2: Interpretation of Sec. 14 and Sec. 31 of The Tamil Nadu Shops and Establishments Act, 1947Employees of both establishments filed claim petitions under Sec. 33-C(2) of the Industrial Disputes Act, 1947, seeking computation of monetary benefits for overtime allowance for work done beyond the prescribed hours of work per week as provided in Sec. 31 of the Act. Both Labour Courts held that Sec. 14 of the Act does not prescribe the number of working hours per day but specifies the maximum number of working hours that can be introduced by an employer. The Labour Courts computed the monetary benefit by granting overtime allowance at double the ordinary wages. The High Court, upon interpreting the relevant provisions, held that once the employer prescribed daily working hours or total number of working hours per week less than permissible under Sec. 14, the rate of overtime allowance as prescribed in Sec. 31 would be applicable. The High Court discharged the rule and confirmed the orders made by both Labour Courts. The appeals questioned this interpretation. The Supreme Court examined the relevant statutory provisions and concluded that Sec. 14(1) prescribes a ceiling on working hours but does not mandate the employer to provide the maximum number of working hours. The employer can prescribe working hours less than the ceiling, and any work done in excess of the prescribed hours would constitute overtime work. The Court held that the statutory rate of overtime wages prescribed in Sec. 31 would apply only to work done in excess of the maximum hours of work permissible under the statute. The Court found that both employers had prescribed the rate of overtime wages at 1-1/2 times the ordinary wages for overtime work in excess of their prescribed hours of work and up to the maximum permissible under Sec. 14(1). The Supreme Court allowed the appeals, quashed the judgment of the High Court, and set aside the common orders of both Labour Courts. The applications made by the employees under Sec. 33-C(2) of the Industrial Disputes Act were dismissed. The appellants were directed to pay costs to the respondents in one set only. S.R. Appeal allowed.
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