Denial of Benefits To Permanent Employees Is Unconstitutional: Gujarat High Court

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On 23rd December 2020, a Single Judge Bench consisting of Hon’ble Mr Justice A.C. Rao heard the case of Hirabhai Nanabhai Bhoi v. State of Gujarat via video conferencing. 

Facts of the Case

The Petitioner being a daily wage worker was granted the benefit of Government Resolution on completion of five years of service. Later, he retired from the service. His grievance redressed in the writ application was limited to the extent that he was not granted the benefit of the unclaimed privilege leave of 300 days to his credit.

The Petitioner had filed an application before the Labour Court when he was terminated and contended that he had worked for 240 days in a year. The Labour Court allowed the application. The said Order was challenged before the Court by the Respondent,but, they did not succeed. The Petitioner then retired and asked for the benefit of leave encashment of 300 days.

Contentions of the Petitioner

Learned Counsel for the Petitioner contended that other employees who had approached the Court had obtained an Order in their favour. They were getting the benefits of encashment but the present Petitioner was not given any benefits of leave encashment and the benefit was withheld arbitrarily.

Contentions of the Respondent

The Learned Counsel contended that the government resolution would only be applicable if the Petitioner had completed 240 days in the year of his service and that was not done by him and therefore, he was not entitled for the said benefit. 

Court’s Analysis

The Court referred to the case of State of Gujarat & Anr. v. Mahendrakumar Bhagvandas & Anr. 2011 (2) GLR 1290, to reach a decision on the case in hand. It quoted the same, “Once the employees concerned are treated as permanent employees, any discrimination or denial of benefits for a segment of such employees, who were subsequently rebranded as “daily wager”, would not be tolerated in the face of Articles 14 and 16 of the Constitution.

The Court then referred to Section 25B of the Industrial Disputes Act, 1947 and observed that daily rated employees to whom the government resolution applied were to be treated as permanent employees with concomitant benefits. Further clarification was also provided stating that the employees, who were completing 5/10/15 years of continuous service, such employees would fall in that category of employees to whom benefits would be accorded. 

Court’s Decision

The Court held that the encashment of the unclaimed privilege leave was to be granted to the Petitioner to the extent of 300 days. The Court directed the Respondent to calculate the amount towards the encashment of the unclaimed privilege leave to the extent of 300 days within a period of four weeks and make the necessary payment to the Petitioner. Thus, the petition was allowed.


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