2013 (2) TMI 107 - SC - Indian Laws

Award of reinstatement - respondents workmen worked as casual labourers on daily wages & due to non-availability of work their services were terminated - Held that - Although an order of retrenchment passed in violation of Section 25-F of the Industrial Disputes Act may be set aside but an award of reinstatement should not be passed. This Court has distinguished between a daily wager who does not hold a post and a permanent employee. In view of the aforementioned legal position and the fact that the respondents - workmen were engaged as daily wagers and they had merely worked for more than 240 days, relief of reinstatement cannot be said to be justified and instead, monetary compensation would meet the ends of justice - direct the appellant Bharat Sanchar Nigam Ltd. to pay Rs.2 lakhs to each of the respondents in full and final settlement of their claim, within six weeks from today else will carry interest at the rate of 12% per annum.

Summary

Issues involved:
Violation of Section 25-F of the Industrial Disputes Act in termination of services of casual laborers; Validity of reinstatement order by Labour Court; Distinction between daily wagers and permanent employees in awarding reinstatement; Justification of monetary compensation over reinstatement.

Violation of Section 25-F of the Industrial Disputes Act:
The respondents, who were casual laborers on daily wages, had their services terminated in 1986 without notice or retrenchment compensation. The Labour Court, in 2005, ordered their reinstatement on the same post held at the time of termination. The appellant challenged this reinstatement order before the High Court, which dismissed the writ petitions. However, the Supreme Court noted that an order of retrenchment passed in violation of Section 25-F may be set aside, but an award of reinstatement should not be passed. The Court distinguished between daily wagers and permanent employees, emphasizing that reinstatement is not justified for daily wagers who do not hold a post.

Validity of reinstatement order by Labour Court:
Considering the legal position and the nature of the respondents' employment as daily wagers, the Supreme Court held that reinstatement was not justified. Instead, the Court concluded that monetary compensation would be appropriate to meet the ends of justice. Consequently, the impugned judgment by the High Court and the award of reinstatement by the Labour Court were set aside.

Distinction between daily wagers and permanent employees in awarding reinstatement:
The Supreme Court emphasized the distinction between daily wagers and permanent employees in the context of reinstatement. Given that the respondents were engaged as daily wagers and had worked for more than 240 days, the Court determined that reinstatement was not warranted in their case. The Court highlighted that monetary compensation would be more suitable in such circumstances.

Justification of monetary compensation over reinstatement:
In light of the legal position and the nature of the respondents' employment, the Supreme Court directed the appellant to pay Rs.2 lakhs to each respondent in full and final settlement of their claim within six weeks. The Court specified that if the payment was not made within the stipulated time, it would carry interest at the rate of 12% per annum. The Court allowed the appeals to this extent and directed the parties to bear their own costs.