1. Employees on deputation/contract in a government corporation dispute denial of 6th Pay Revision benefits and a resolution linking pay to parent organizations. (Para 2 , 3 )
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2019 Supreme(SC) 120
SUPREME COURT OF INDIA
L. NAGESWARA RAO, M. R. SHAH, JJ.
Bihar State Beverages Corporation Ltd. & Ors. – Appellants
Versus
Naresh Kumar Mishra & Ors. – Respondents
CIVIL APPEAL NOS. 1468-69 OF 2019 [Arising out of SLP (C) Nos. 29890-29891 of 2017]
Decided on : 05-02-2019
Important Points
IMPORTANT POINT
To pay any salary/pay scale lesser than what was offered at the time of inviting the applications would be changing the conditions of service is not permissible.
To pay any salary/pay scale lesser than what was offered at the time of inviting the applications would be changing the conditions of service is not permissible.
Subject
Employment Law - Equal Pay for Equal Work
Act Referred
BIHAR SERVICE CODE: R.282, R.283, S.283(c), S.283(e)
COMPANIES ACT: S.617
CONSTITUTION OF INDIA: Art.14, Art.16
COMPANIES ACT: S.617
CONSTITUTION OF INDIA: Art.14, Art.16
Headnote
(a) Service law – Pay – All petitioners employees of appellant Corpn. – All on deputation from different organizations – Doing similar work – Appellant Corpn. directing employees to be paid as per their respective organizations plus deputation allowance – Resulting in different pay for different employees doing similar pay – Contrary to equal pay for equal work. (Para 8)
(2006) 9 SCC 321 – Referred
(b) Service law – Pay – Advertisement offering special pay scale against respective posts as per 5th PRC – Denying benefit of 6th PRC – Deciding to pay the employees as per their parent organization pay structure resulting in lesser pay – Held, to pay any salary/pay scale lesser than what was offered at the time of inviting the applications would be changing the conditions of service – Not permissible. (Para 8)
(c) Bihar Service Code – Rule 282 and 283 – Persons on deputation – Paying more pay to deputationists than paid to him in his patent organization – Permissible – Rule 283 does not require that the employee sent on deputation to a foreign service has to be paid the same salary/pay scale which he was getting in the parent department – Appellant’s resolution dated 27.3.2012 held misplaced and/or on misinterpretation – Rightly set aside by High Court. (Para 8)
Facts of the case:
All the original Writ Petitioners are working with the Appellant Corporation on different posts since 2006. The Appellant Corporation issued an Advertisement on 18.8.2006 for making appointment by way of contract/deputation of the employees of other Board and Corporation and also from the retired employees of the Board and/or Corporation of the State or Central Government. Such appointment was to be made on the post of Manager, Accounts Officer, Accountant, Assistant Accountant, Depot Manager etc. The advertisement also prescribed pay scale which was then prevalent in the State Government as per the recommendation of the 5th Pay Revision Committee. The respective original Writ Petitioners in both the writ petitions were the employees of the Bihar State Corporation Coordinating Unit (BISCOMAUN); Bihar State Pharmaceutical and Chemical Development Corporation; Bihar State Handloom and Handicraft Development Corporation; Sone Command Area Development Agency; Land Mortgage Bank; Pandaul Cooperative Spinning Mills Ltd., as the case may be. That, all of them applied pursuant to the aforesaid advertisement. All of them were selected on various posts in the Corporation.
The employees working with the Corporation were denied the benefit of the pay scale as per the recommendations of the 6th Pay Revision Committee. A resolution was passed on 27.3.2012 and it was resolved that all those employees working with the Appellant Corporation on deputation shall be paid the pay scale payable in their parent Corporation and deputation allowance.
Therefore, the original Writ Petitioners preferred the aforesaid writ petitions before the High Court for an appropriate direction to the Corporation to grant them the pay scale of 6th Pay Revision Committee with effect from 1.1.2006 notionally and financial benefit with effect from 1.4.2007. In CWJC No. 9760 of 2012, one additional prayer was made for quashing of the resolution of the Board of Directors dated 27.3.2012.
The learned Single Judge dismissed both the petitions.
The Division Bench has allowed both the Letters Patent Appeals and quashed and set aside the common judgment and order passed by the learned Single Judge and consequently the resolution of the Corporation dated 27.3.2012 and directed the Corporation to follow the “Principle of Equal wages for equal work” in the matter of grant of pay scale. The Division Bench also directed the Corporation to pay the revision of pay scales in terms of the 6th Pay Revision Committee and resolution of the Board of Directors dated 18.5.2010.
Finding of the Court:
High Court rightly quashed the resolution dated 27.3.2012 .
Result: Appeals dismissed.
Legal Category Hierarchy
Table of Contents
2. Whether the principle of equal pay for equal work applies to deputation employees and whether Bihar Service Code rules prohibit pay higher than parent organizations. (Para 5 , 6 )
3. Resolution linking pay to parent organizations creates disparity for similar work; reducing pay offered in advertisements is impermissible; Bihar Service Code allows higher pay in foreign service. (Para 8 , 9 )
4. Employees performing similar work in the same organization are entitled to equal pay; service conditions offered during recruitment cannot be unilaterally reduced. (Para 8 )
5. Appeals dismissed; employees entitled to 6th Pay Revision benefits while employed by the corporation, reverting to parent pay upon repatriation. (Para 10 )
6. Does the principle of equal pay for equal work apply to employees on deputation performing similar roles within the same organization?
Yes. When employees perform the same or similar work within an organization, they must be paid the same salary to avoid disparity, regardless of whether they are on deputation from different parent organizations. (Para 8 )
7. Can pay revision benefits be denied to deputation staff on the basis that they are not permanent employees if the organization has no permanent staff?
No. If an organization has no permanent employees and the entire staff consists of deputation or contract employees, denying benefits based on a distinction between permanent and deputation staff reflects a non-application of mind. (Para 9 )
JUDGMENT :
M. R. SHAH, J.
1. Leave granted.
2. Feeling aggrieved and dissatisfied with the impugned common judgment and order passed by the Division Bench of the High Court of Judicature at Patna dated 19.7.2017 in Letters Patent Appeal No. 162 of 2016 in CWJC No. 9760 of 2012 and in Letters patent Appeal No. 568 of 2016 in CWJC No. 3224 of 2012, by which the Division Bench has allowed the said Letters Patent Appeals and has set aside the order passed by the learned Single Judge passed in CWJC No. 9760 of 2012 and CWJC No. 3224 of 2012 dismissing the said writ petitions and, consequently, allowing the petitions by holding that the respective original Writ Petitioners – Respondents herein, the employees of the Appellant – Bihar State Beverages Corporation Limited (hereinafter referred to as the “Corporation”) are entitled to the 6th Pay Revision, the Appellant Corporation has preferred the present Appeals.
3. That all the original Writ Petitioners are working with the Appellant Corporation on different posts since 2006. That the Appellant Corporation came into existence in view of the decision of the State Government in the year 2006 when it was incorporated as a Government Company in terms of Section 617 of the Companies Act with its main objective being to improve the excise revenue of the Government of Bihar. It appears that a decision was taken not to make any appointment in the Corporation by direct recruitment, but to bring the employees by way of contract/deputation from amongst the employees of the other Board and Corporation and also from retired employees of the Board and/or Corporation of the State or the Central Government. Therefore, as such, there is not a single employee working with the Corporation appointed by the Corporation by way of direct recruit. The Appellant Corporation issued an Advertisement on 18.8.2006 for making appointment by way of contract/deputation of the employees of other Board and Corporation and also from the retired employees of the Board and/or Corporation of the State or Central Government. Such appointment was to be made on the post of Manager, Accounts Officer, Accountant, Assistant Accountant, Depot Manager etc. The advertisement also prescribed pay scale which was then prevalent in the State Government as per the recommendation of the 5th Pay Revision Committee. The respective original Writ Petitioners in both the writ petitions were the employees of the Bihar State Corporation Coordinating Unit (BISCOMAUN); Bihar State Pharmaceutical and Chemical Development Corporation; Bihar State Handloom and Handicraft Development Corporation; Sone Command Area Development Agency; Land Mortgage Bank; Pandaul Cooperative Spinning Mills Ltd., as the case may be. That, all of them applied pursuant to the aforesaid advertisement. All of them were selected on various posts in the Corporation.
3.1 It appears that the employees working with the Corporation were denied the benefit of the pay scale as per the recommendations of the 6th Pay Revision Committee. It appears that, as such, the Board of Directors of the Corporation in its meeting dated 18.5.2010 resolved that the employees appointed on deputation/contract would be granted revised pay scale. However, the Finance Department raised an objection against grant of revision of pay scale as per the 6th Pay Revision Committee to the employees on deputation and/or contract basis working with the Appellant Corporation and advised the Corporation to grant the benefit of 6th Pay Revision Committee only to the employees of the Corporation and not the employees working in the Corporation on deputation. It appears that, thereafter, the Board of the Corporation in its meeting passed a resolution on 27.3.2012 (as per the Corporation, the said resolution was passed in the light of the letter dated 30.11.2011 of the State Government) and it was resolved that all those employees working with the Appellant Corporation on deputation shall be paid the pay scale payable
