Back Wages of Labourers is a Question of Facts Depending Upon Various Factors: Gujarat High Court

The petition has been filed by workmen and employer against an award dated 23.04.2009 passed by the Labour Court, Bhuj in the case of Karsan Shivaji Sanghar v. Ashapura Mines Chem Limited.

Brief Facts

The workman was appointed to the post of supervisor and was rendering service for more than five years under the supervision of the employer. However, there was no appointment letter and consequently, he was terminated without conducting the inquiry with effect from 30.06.1999. Further, the Labour Court has granted reinstatement in service while treating service in continuous with 25% back wages. Thereby, he contended that it deserves to be granted 100% back wages rather than 25% and therefore Labour Court has factually committed error in not granting 100% back wages and prayed to set aside and quashed the award immediately.  

The employer also filed a special civil application contending that as provided workmen were serving their work on a daily rated basis and on the same ground when work is unavailable such discharges employer from the work. Further, it would be incorrect to say that unavailability of work could lead to industrial dispute and the Industrial Dispute Act would be inapplicable in case of workmen. Moreover, the Labour Court awarded the order in favour of workmen without proper scrutinizing evidence, four years of continuous service of the workman. The law of retrenchment cannot be applicable to daily rated labour alongside the workers had not resumed their duty. Therefore, the award deserved to be set aside and quashed.

Petitioner’s Arguments

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The counsel for workman submitted before the Court that in an earlier similar matter, the Apex Court took the decision of granting 100% back wages but in the present case, Labour Court granted 25% back wages without any valid ground which is materially erroneous and deserve to be set aside. The counsel took the reference of Talwara Cooperative Credit and Service Society Limited v. Sushil Kumar reported  (2008) 9 SCC 486, the Apex Court held that, 

For the purpose of grant of back wages; one of the relevant factors would indisputably be as to whether the workman had been able to discharge his burden that he had not been gainfully employed after the termination of his service.

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Further in the case of G.M.Haryana Roadways v. Rudhan Singh, (2005) 5 SCC 591, the Court held that,

“A host of factors like the manner and method of selection and appointment. One of the important factors is the length of service, which the workman had rendered with the employer. If the workman has rendered a considerable period of service and his services are wrongfully terminated, he may be awarded full or partial back wages keeping in view the fact that at his age and the qualification possessed by him he may not be in a position to get another employment. Another important factor, which requires to be taken into consideration is the nature of employment. Regular service of permanent character cannot be compared to short or intermittent daily-wage employment though it may be for 240 days in a calendar year”.

Respondent’s Arguments

The counsel for the employer submitted before the Court that the Labour Court has committed a grave error in ignoring or not considering the fact that workmen are daily rated workers rather than regular wage earners. Moreover, the law of retrenchment would be inapplicable to the said workers and workers are not entitled to reinstatement with continuous services.

The counsel relied upon the case of U.P.State Brassware Corpn. Ltd. And Another v. Uday Narain Pandey (2006) 1 SCC 479 held that there is no straitjacket formula to know as in which circumstances payment of entire back wages should be granted but it depends upon facts and circumstances of the case. It must refrain from granting mechanically because of termination order in contravention of section 6-N of the U.P. Industrial Disputes Act or technical grounds. “A person is not entitled to get something only because it would be lawful to do so. If that principle is applied, the functions of an Industrial Court shall lose much of its significance”.

Court’s Observations

The Court after hearing both parties and referring to the Labour Court observed that during the pendency of these petitions, the workmen have been reinstated in service. The observation of the Labour Court concluded that workmen not only were appointed on oral order but also without specific order and period. In absence of any written appointment letter and merely stating work cannot be treated as an appointment for a fixed term. Moreover, the employer stated that workmen have worked since 20.01.1996 and not retrenched on 30.06.1995 but transferred. In addition to this, the worker has on continuous working since his appointment till he relieved.

Court’s Decision

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The Court concluded that there was no error committed by Labour Court in arriving at the conclusion of granting relief of reinstatement. It is pertinent to note that workman was not paid a salary and retrenched from 30.06.1999 to 23.04.2009. Therefore, workmen are required to be paid as he was already reinstated in service. With respect to backwages, the workmen must be granted just and proper to pay lumpsum compensation of Rs.55,000 for back wages.

Click here to read the full judgment.


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