SUPREME COURT OF INDIA
PAMIDIGHANTAM SRI NARASIMHA, SANDEEP MEHTA, JJ.
Mahanadi Coalfields Ltd. – Appellant
Versus
Brajrajnagar Coal Mines Workers’ Union – Respondent
Civil Appeal Nos. 4092-4093 of 2024, Arising Out of SLP (C) Nos. 6370-6371 of 2024, Arising Out of SLP (C) Diary No. 32072 of 2021
Decided On : 12-03-2024
Contract Labour - Regularization of Workmen - National Coal Wage Agreement-IV - 11.5.1, 11.5.2 - Industrial Disputes Act, 1947, Section 10(2A)(1)(d) - Industrial Dispute (Central) Rules, 1957, Rule 58
Fact of the Case:
The appellant, a subsidiary of Coal India Ltd., floated a tender for transportation of crushed coal and selected a contractor. The respondent-union sought permanent status for workmen engaged by the contractor, relying on clauses 11.5.1 and 11.5.2 of the National Coal Wage Agreement-IV. A settlement was reached for 19 workmen, and the dispute was referred to the Industrial Tribunal. The Tribunal directed the regularization of the remaining 13 workmen, which was upheld by the High Court.
Finding of the Court:
The Tribunal was justified in considering the entire reference and giving independent findings. The High Court affirmed the Tribunal's findings, and the Supreme Court dismissed the appeals, upholding the regularization of the 13 workmen and awarding backwages from 23.05.2002.
Issues: Validity of Tribunal's jurisdiction, applicability of settlement, distinction between workmen for regularization, entitlement to backwages
Ratio Decidendi: The Tribunal had jurisdiction to consider the entire reference despite the settlement. The 13 workmen were wrongly denied regularization, as their work was similar to the regularized employees. The denial was unjustified, and the workmen were entitled to backwages from 23.05.2002.
Final Decision: The appeals were dismissed, affirming the regularization of the 13 workmen and awarding backwages from 23.05.2002. No costs were awarded.
JUDGMENT :
PAMIDIGHANTAM SRI NARASIMHA, J.
1. Delay condoned. Leave granted.
2. The Appellant, Mahanadi Coalfields Ltd. a subsidiary of Coal India Ltd. floated a tender for the transportation of crushed coal and selected a successful contractor for performance of the agreement for the period 1984 to 1994. The contractor employed workmen for execution of this contract.
3. The respondent-union espoused the cause of the workmen who were engaged by the contractor and sought permanent status for them. It relied on clauses 11.5.1 and 11.5.2 of the National Coal Wage Agreement-IV dated 27.07.1989. Under these clauses, it was agreed that the employer shall not engage contract labour with respect to jobs which are permanent and perennial in nature. They also provide that such jobs shall be executed through regular employees.
4. Following the representation of the respondent-union, the Assistant Labour Commissioner sent a notice to the appellant for conciliation. The conciliation process eventually culminated in a settlement dated 05.04.1997 under Rule 58 of the Industrial Disputes (Central) Rules, 1957. The relevant portion of the settlement is as follows:
| S. No. | Name of the Person | Father’s Name |
| 01. | Sri Sadanand Bhoi | Keshab |
| 02. | Sri Purusottam Dau | Govardhan |
| 03. | Sri Anta Barik | Gadadhar |
| 04. | Sri Aditya Nikhandia | Cheru |
| 05. | Sri Bhabagrahi Pradhan | D. Pradhan |
| 06. | Sri Sudarshan Khandit | Masru |
| 07. | Sri Ashok Kumar Rout | Sitaram |
| 08. | Sri Krishna Dau | Goverdhan |
| 09. | Sri Abhimanyu Kisan | Chhala |
| 10. | Sri Lakhan Bhoi | Keshab |
| 11. | Sri Jay Narayan Bhoi | Chaitan |
| 12. | Sri Sanatan Kisan | Ugresan |
| 13. | Sri Giridhari Raudia | Goverdhan |
| 14. | Sri Daitari Pradhan | Nira |
| 15. | Sri Subram Bag | Buchhu |
| 16. | Sri Madhu Marai | Dasa |
| 17. | Sri Fakir Khamari | Kartik |
| 18. | Sri Sanatan Naik | Ram Krishna |
| 19. | Sri Sanatan Bhoi | Tiharu |
In respect of other persons, it was contended, that they are engaged in purely casual nature of jobs, which are not prohibited under Contract Labour (R&A) Act, 1970, and accordingly, they are not eligible for regularisation.”
5. In view of the fact that the settlement is confined to only 19 workmen, the Central Government referred the entire dispute to the Industrial Tribunal under Section 10 (2A)(1)(d) of the Industrial Disputes Act, 1947, on 20.05.1997 registered as Dispute Case no. 27/2001 before the Industrial Tribunal, Rourkela, Odisha. Before the Tribunal, the workmen examined 3 witnesses in support of their case and the management examined 4 witnesses.
6. By its judgment dated 23.05.2002, the Tribunal allowed the industrial dispute and directed the regularization of the remaining 13 workmen. The important findings of the Tribunal are as follows. At the outset, the Tribunal rejected the preliminary objection that it had no jurisdiction under the Contract Labour (Regulation and Abolition Act), 1970 and proceeded to consider the nature of the work that the 13 workmen were performing. Having considered the matter in detail, the Tribunal held that the work of removing spillages in the railway siding, below the bunker and operation of chutes (in the bunker) are regular and perennial in nature. Having considered the evidence of the management witnesses, the Tribunal concluded that the nature of the work is perennial. Accordingly, the remaining 13 workers were directed to be regularized in the following terms:
The absence of proper contractor registration leads to a presumption of employer-employee relationship, entitling workmen to regularization in permanent jobs.
The court upheld the Tribunal's awards for employee regularization, emphasizing the prohibition of unfair labor practices under the Industrial Disputes Act, while clarifying the need for state approv....
The main legal point established in the judgment is that workmen engaged against permanent vacancies are entitled to be regularized as permanent employees, and engaging workmen as temporary, casual, ....
An unregistered trade union can represent workers collectively, and the status of employment should be determined by actual working conditions, not merely contractual labels, establishing permanent e....
Private companies cannot use discretion to justify unfair labour practices, and past financial status as a sick unit does not prevent directions of permanency that may increase financial burden.
The judgment establishes that the regularisation of contract workers is contingent upon the existence of a clear employer-employee relationship and compliance with relevant legal provisions, includin....
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