Point of Law: Special Allowance cannot be a part of the component of “ordinary rate of wages”, as it is a separate allowance, which is not given to all workmen, but only given to a certain category of workmen, having a nexus to the extra work done.

JUDGMENT :

Heard Mr. UK Nair, learned senior counsel assisted by Ms. A Verma, learned counsel for the petitioners. Also heard Mr. KN Choudhury, learned senior counsel assisted by Mr. HK Das, learned counsel for the respondent.

2. The petitioners (Management) have prayed for setting aside the impugned Award dated 19.07.2017 passed by the Central Government Industrial Tribunal-cum-Labour Court, Guwahati in Reference Case No. 12/2012 and the letter dated 07.09.2017 issued by the Secretary to the Central Government Industrial Tribunal-cum-Labour Court. Though the petitioners have made a challenge to the impugned Award dated 19.07.2017 on 2 (two) grounds, the petitioners have now restricted their challenge to the impugned Award only with respect to paragraph No. 32 of the impugned Award, wherein the learned Tribunal has held that the Special Allowance which is paid to a certain category of workmen in Numaligarh Refinery Limited, should be taken into account, while calculating their overtime wages/ordinary rate of wages. The impugned letter dated 07.09.2017 is the forwarding letter issued by the Secretary to the Central Govt. Industrial Tribunal-cum-Labour Court, forwarding the impugned Award dated 19.07.2017 to the petitioners.

3. The brief history of the case is that a Tripartite Settlement/Memorandum of Settlement (MoS) dated 11.10.2010 was arrived at between the Numaligarh Refinery Employees Union (hereinafter referred to as the “NREU”), the Numaligarh Refinery Limited (NRL) and the Assistant Labour Commissioner. The validity of the above Memorandum of Settlement (MoS) was for the period from 01.01.2007 to 31.12.2016. In terms of Clause 10.0 of the MoS, Special Allowance for workmen in “48 hours a week work schedule” were to be paid @ 10% of the basic pay per month w.e.f. 01.01.2007.

4. The issue to be decided in this case is as to whether the “Special Allowance” should be computed while arriving at the “ordinary rate of wages” of a workman in terms of Section 59(2) of the Factories Act, 1948.

5. The respondent herein, which is the Minority Employees Union and who were not a signatory to the MoS, have made a claim that the Special Allowance should be calculated while computing the “ordinary rate of wages” of a workman under the Factories Act, 1948, i.e., Special Allowance should be a part of the “ordinary rate of wages”.

6. The said issue was decided by the learned Tribunal in Reference Case No. 12/2012, vide the impugned Award dated 19.07.2017, by holding that Special Allowance, which was to be paid to a certain category of workmen in NRL should be taken into account while calculating their overtime wages, i.e., it should form a part of the “ordinary rate of wages”. The relevant paragraph No. 32 of the impugned Award dated 19.07.2017 passed in Reference Case No. 12/2012, is with regard to the interpretation made by the learned Tribunal in relation to Section 59(2) of the 1948 Act, is reproduced below:-

“32. The aforesaid provision is crystal clear that all the pay and allowances paid to the employees, except the bonus and overtime allowance, shall form part of “ordinary rate of wages” for the purpose of calculation of overtime. Any agreement or any order contrary to the above cannot be made binding upon the workmen. It is therefore, held that the “Special Allowance” which is paid to a certain category of workmen in NRL shall be taken into account in calculating their overtime wages.”

7. The petitioners’ counsel submits that a perusal of Section 59(1) and 59(2) of the Factories Act, 1948 (hereinafter referred to as the “1948 Act”) clearly shows that a bonus or “wage for overtime work” cannot be included within the meaning of “ordinary rate of wages”. The learned senior counsel for the petitioners has also relied upon the judgment of this Court in the case of Mekhilipara Tea Company Ltd. Vs. Regional Provident Fund Commissioner, Aga