Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2019 Supreme(SC) 509

SUPREME COURT OF INDIA
L. NAGESWARA RAO, M.R.SHAH, JJ.
Hindustan Sanitaryware and Industries Ltd. & Others – Appellants
Versus
The State of Haryana – Respondent
CIVIL APPEAL No . 2539 of 2010
WITH
Faridabad Industries Association – Appellant
Versus
The State of Haryana & Another – Respondents
CIVIL APPEAL No . 4454 of 2019 (Arising out of Special Leave Petition (Civil) No. 5832 of 2018)
Decided On : 29-04-2019

Advocates Appeared:
For Appellant(s) : Mr. Kailash Vasdev,Sr. Adv. Mr. Siddharth Dias, Adv. Mr. Umrao Singh Rawat, Adv. Mr. Sumer Singh Sandhu, Adv. Ms. Limayinla Jamir, Adv. Ms. Nayantara, Adv. Ms. V. D. Khanna, AOR Mr. Harvinder Singh, Adv. Ms. Meera Mathur, AOR Mr. Vishal Sharma, Adv.
For Respondent(s) Dr. Monika Gusain, Adv. Mr. Kamal Mohan Gupta, AOR Mr. Raj Singh Rana, Adv. Mr. Pankaj Kumar Singh, Adv. Mr. Vishwa Pal Singh, AOR

IMPORTANT POINTS
The prohibition of segregation of wages into components in the form of allowances in the Notification is impermissible;
The security inspector/ security officer/ security supervisor cannot be included in the Notification;
Trainees who are employed without payment of any reward cannot be covered by the Notification;
Categorization of unskilled employees as semiskilled and semi-skilled as skilled on the basis of their experience is ultra vires. (e) Fixing the training period for one year is beyond the jurisdiction of the Government.

Headnote:(a) Minimum Wages Act, 1948 - Section 2(h) - Notification introducing deemed categorization of employees after certain years of experience at a particular level - Amounting to changing terms of contract of employment - Not permissible. (Para 13)
       (b) Minimum Wages Act, 1948 - Section 2(i) - Employee - Security inspector/ Security officer/ Supervisor not employees in terms of section 2(i) - Could not be included in the table of minimum rates of wages for employees. (Para 13)
       (c) Minimum Wages Act, 1948 - Section 2(i) - Trainees who receive wages covered by definition of employees - Their wages could be revised under the Act - Including all trainees/apprentices - Not permissible. (Para 13)
       (d) Minimum Wages Act, 1948 - Section 2(h), (i) and 3, 4, 5 - Minimum wages - Appropriate Government authorised to prescribe, fix or revise wages - No distinction between employee employed by the principal employer and a person employed through a contractor - Contention that contract workers are not covered by the Act rejected. (Para 14)
       1962 Supp (1) SCR 381 - Relied upon
       (e) Minimum Wages Act, 1948 - Section 2(h), (i) and 3, 4, 5 - Wages include all remuneration in one package - Not amenable to split up - Prohibition on segregation of the wages into components under the notification - Not permissible. (Para 16)
       (f) Administrative law - Government notification - Some parts not approved by Court - Other parts shall continue to be in force and operate. (Para 17)
       (1999) 6 SCC 567 - Relied upon
       Facts of the case:
       In exercise of the powers conferred by Section 5(2) of the Act, the Finance Commissioner and Principal Secretary to the Government of Haryana, Labour Department issued a Notification on 27.06.2007 fixing/revising the minimum rates of wages in respect of different scheduled employments as mentioned in the schedule therein with effect from 01.07.2007.
       The Appellant filed a Writ Petition challenging the Notification dated 27.06.2007 issued under Section 5 (2) of the Minimum Wages Act, 1948 (hereinafter, “the Act”). The said Writ Petition was dismissed by the High Court.
       Similarly by a Notification dated 21.10.2015, the Labour Department of the Government of Haryana revised the minimum rates of wages in respect of different scheduled employments as mentioned in the schedules therein with effect from 01.11.2015.
       The appellant filed writ petition challenging the notification which has been dismissed.
       Finding of the court:
       Notification in part is ultra vires.
       Result: Appeals allowed.

JUDGMENT

L. NAGESWARA RAO, J.

CIVIL APPEAL No . 2539 of 2010

1. The Appellant filed a Writ Petition challenging the Notification dated 27.06.2007 issued under Section 5 (2) of the Minimum Wages Act, 1948 (hereinafter, “the Act”). The said Writ Petition was dismissed by the High Court. Aggrieved by the judgment of the High Court, the Appellant has approached this Court.

2. In exercise of the powers conferred by Section 5(2) of the Act, the Finance Commissioner and Principal Secretary to the Government of Haryana, Labour Department issued a Notification on 27.06.2007 fixing/revising the minimum rates of wages in respect of different scheduled employments as mentioned in the schedule therein with effect from 01.07.2007. The relevant provisions of the Notification dated 27.06.2007 are as under:

• Unskilled employees having 10 years’ experience would be deemed categorized as semi-skilled “A”.
• After 3 years of experience in semi-skilled “A”, the employees would be deemed categorized as semiskilled “B”
• After 3 years of experience in skilled “A”, the employees would be deemed categorized as skilled “B”.
xxx
Note:
1. The minimum rates of wages being fixed/ revised are linked with Haryana State Working Consumer Price Index Number (base year 1972-73=100) with July 2007 as the base month. The rate of neutralization will be Rs.2.31 per point on the rise or fall of the Consumer Price Index Number, adjustment in wages shall be made six monthly i.e. 1 st January and 1 st July, every year after taking into account the average rise or fall in the Haryana State Working Class Consumer Price Index Number half-yearly ending December and June respectively.
2. The minimum rates of wages being now fixed/ revised shall not be affected as a result of the linkage as much as the wages shall not fall below those being fixed/ revised now.
3 The wages of apprentices appointed under the Apprentices Act, 1961 (52 of 1961), shall be regulated under the said Act.
4. There shall be no difference between the wages for men and women workers.
5. Where any of the above categories of workmen are engaged/ employed through a Contractor, the Occupier/ the Principal Employer shall be personally responsible for ensuring the payment of the minimum rates of wages by the Contractor.
6. If any category of workers employed in the employment is not mentioned specifically by name, he/she shall not be paid less than the minimum wages fixed for similar category having same skill.
7. While calculating the per day wages, the monthly wages shall be divided by 26 days but for deduction, if any, shall be calculated monthly wages divided by 30 days.
8. The categorization of employment in Brick Kiln is placed at Annexure-A
9. Above rates are without food. Wherever food is given customarily, it shall be extra.
10. Trainees will be paid 75% of the wages applicable to the category but it will not be less than the Minimum Wages for an unskilled category of worker. The period of training will not be more than one year.”

3. The above Appeal was taken up along with the other Writ Petitions which were filed for the same relief. Without a detailed discussion on the issues which arose in the Writ Petition, the High Court dismissed the Writ Petition by observing that the contention raised by the Petitioners relating to classification was misconceived and that the trainees would fall within the purview of the Act.

Civil Appeal No. 4454 of 2019 (Arising out of Special Leave Petition (Civil) No. 5832 of 2018)

Leave granted.

4. This Appeal by Special Leave is filed against the judgment of the High Court dated 18.08.2017 by which the Writ Petition filed by the Appellant questioning the Notification dated 21.10.2015 issued under Section 5(2) of the Act was dismissed.

5. By a Notification dated 21.10.2015, the Labour Department of the Government of Haryana revised the minimum rates of wages in respect of different scheduled employments as mentioned in the schedules therein with effect from 01.11.2015. It is necessary to repro

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2019 Supreme(SC) 509

Cases Referred (2)