1. Daily wager termination without notice or retrenchment compensation — Violation of Section 25-F, Industrial Disputes Act — Labour Court declined reinstatement. (Para 2 , 3 )
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2026 Supreme(Raj) 635
IN THE HIGH COURT OF JUDICATURE FOR RAJASTHAN AT JAIPUR
PRAVEER BHATNAGAR, J.
Sita Ram S/o Shri Ram Chandra – Appellant
Versus
The Assistant Engineer, Irrigation Sub-Division, Malpura – Respondent
S.B. Civil Writ Petition No. 1423 of 2009
Decided On : 27-02-2026
Advocates Appeared:
For the Appellant : Suresh Kashyap
For the Respondent: Gopal Krishan Sharma
For the Appellant : Suresh Kashyap
For the Respondent: Gopal Krishan Sharma
Reinstatement is not an automatic remedy for violating Section 25-F of the Industrial Disputes Act, 1947, especially for daily wagers. Courts may award lump-sum monetary compensation instead, considering the nature of employment, absence of a sanctioned post, and the passage of time.
Headnote:(A) Industrial Disputes Act, 1947 - Section 25-F - Retrenchment without compliance of mandatory requirements - Reinstatement is not an automatic or mechanical consequence of every breach of Section 25-F - Shift in legal position where relief by way of reinstatement with back wages may be inappropriate even if termination is in contravention of prescribed procedure, and monetary compensation may be awarded to meet the ends of justice (Paras 11, 12).
(B) Industrial Disputes Act, 1947 - Relieving daily wagers - Distinction exists between a daily wager who does not hold a post and a permanent employee - Relief must be moulded having regard to the nature of employment, duration of service, and the passage of time; reinstating daily wagers after lengthy litigation may disrupt industrial harmony (Paras 12, 13, 16).
(C) Constitution of India - Article 226 - Scope of supervisory jurisdiction - Interference with an award is warranted only where it suffers from perversity, patent illegality, or manifest injustice; the court does not sit as an appellate authority to substitute its view (Para 17).
Facts of the case:
An employee engaged as a daily wager was terminated without the issuance of notice or payment of retrenchment compensation, in violation of Section 25-F of the Industrial Disputes Act, 1947. The Labour Court held the retrenchment to be illegal but declined the relief of reinstatement. The petitioner challenged this award, seeking reinstatement with partial back wages and consequential benefits.
Findings of Court:
The Court affirmed the finding that the termination was in violation of Section 25-F and thus illegal. However, it found that the petitioner was engaged purely as a daily wager without a formal recruitment process or a sanctioned post. Given the length of time elapsed since termination and the nature of the engagement, the Court held that the Labour Court was correct in declining reinstatement.
Issues: Whether the Labour Court was justified in declining reinstatement despite holding that the retrenchment was in violation of Section 25-F of the Industrial Disputes Act, 1947, or if the award should be modified to provide monetary compensation.
Ratio Decidendi: Reinstatement is not a mandatory consequence of illegal retrenchment under Section 25-F. In cases involving daily wagers, courts must consider whether the appointment was made per statutory rules and the duration of the dispute. Since the petitioner lacked permanent status and significant time had passed, lump-sum monetary compensation is a more balanced and practical remedy than reinstatement.
Result: Writ petition partly allowed and the award of the tribunal modified to grant lump-sum monetary compensation of Rs.3,40,000/- in lieu of reinstatement.
Legal Category Hierarchy
Table of Contents
2. Workman argued reinstatement automatic after violation; employer contended daily wager engagement and passage of time justify compensation instead. (Para 4 , 5 , 6 , 7 , 8 )
3. Reinstatement not automatic despite Section 25-F breach; factors like daily wager status, no sanctioned post, and delay considered. Compensation appropriate. (Para 10 , 15 , 16 )
4. Breach of Section 25-F does not mandate reinstatement; compensation may be awarded considering employment nature, duration, and elapsed time. (Para 11 , 12 , 13 , 14 )
5. Writ partly allowed; affirmed illegality but modified relief to lump-sum compensation instead of reinstatement. (Para 19 , 21 )
6. Is reinstatement an automatic consequence of violation of Section 25-F of the Industrial Disputes Act?
No. The Supreme Court has held reinstatement is not automatic; courts must consider factors like daily wage status, lack of sanctioned post, and delay. Compensation may be granted. (Para 11 , 12 , 13 , 14 )
7. What factors are relevant when deciding relief for illegal retrenchment of a daily wager?
Factors include nature of employment, duration of service, passage of time, appointment through regular selection, and existence of a sanctioned post. Daily wagers without status may receive compensation. (Para 15 , 16 )
8. Can a Labour Court award compensation instead of reinstatement despite finding illegal termination?
Yes. Recent precedents permit compensation as a balanced remedy for daily wagers, especially when reinstatement would disturb industrial harmony and lengthy litigation has elapsed. (Para 13 , 14 , 18 )
9. What is the standard of judicial review under Article 226 of the Constitution concerning Labour Court awards?
Jurisdiction under Article 226 is supervisory, not appellate. Interference is warranted only for perversity, patent illegality, or manifest injustice, or when relief contradicts binding precedents. (Para 17 )
JUDGMENT :
PRAVEER BHATNAGAR, J.
1. The present writ petition has been filed by the petitioner-workman challenging the award dated 09.10.2003 passed by the learned Labour Court No.2 Jaipur, whereby though the termination of the petitioner was held to be in violation of Section 25-F of the Industrial Disputes Act, 1947 (for short, ‘the Act of 1947’), the relief of reinstatement was declined. The petitioner has prayed that he may be reinstated in the services with 25 percent back wages and other consequential benefits.
2. Briefly stated, the petitioner was engaged by the respondent–department as a daily wager and thereafter, his services came to be terminated without issuance of notice or payment of retrenchment compensation as contemplated under Section 25-F of the Act of 1947.
3. Thereafter, the dispute was raised and referred for adjudication before the Labour Court and upon appreciation of the pleadings and evidence, the learned Labour Court recorded a finding that the mandatory requirements of Section 25-F had not been complied with and, therefore, the retrenchment was illegal. However, taking into consideration the nature of engagement and other attendant circumstances, the Labour Court declined reinstatement.
4. Learned counsel for the petitioner contends that once the Labour Court recorded a categorical finding that the retrenchment was in violation of Section 25-F of the Act of 1947, reinstatement ought to have followed as a natural and consequential relief and denial of the same defeats the very protection afforded by the statute.
5. It is further argued that illegality in termination renders the order void ab initio and the workman is entitled to restoration of service with continuity and consequential benefits. In this regard, reliance has been placed upon the judgment passed by the Co-ordinate bench of this Court in the case of Ram Prasad Mali v. The Regional Officer, Archaeological Survey of India , 2017 (2) WLC (Raj.) UC 637 to contend that violation of Section 25-F ordinarily results in reinstatement unless exceptional circumstances are made out.
6. Per contra, learned counsel appearing for the respondents supports the impugned award and submits that the Labour Court has exercised its discretion judiciously and in consonance with settled principles of law.
7. It is submitted that the petitioner was engaged purely as a daily wager without any formal recruitment process, for a limited duration and his engagement was neither against a sanctioned post nor pursuant to any regular selection procedure.
8. Learned counsel further submits that considerable time has elapsed since the date of termination and the nature of the establishment has undergone substantial changes, therefore, reinstatement at this stage would not only disturb administrative functioning but would also be inequitable. In this regard, reliance is placed upon the judgment passed in the case of State of Uttarakhand & Anr. v. Raj Kumar, (2019) 14 SCC 353 and Co- ordinate bench of this Court in the case of Iqbal Hussain v. Judge, Labour Court & Ors., 2025:RJ-JP:46321, to contend that reinstatement is no longer an automatic consequence of violation of Section 25-F, particularly in cases involving daily wagers or short-term engagements.
9. In light of the rival submissions, the principal issue which arises for consideration is, whether the learned Labour Court was justified in declining reinstatement despite holding that the retrenchment was in violation of 25F of the 1947 Act, or if the award should be altered to include monetary compensation instead.
10. There is no dispute with respect to the finding recorded by the Labour Court that the termination was effected without compliance of Section 25-F of the Act of 1947 and such non-compliance undoubtedly renders the retrenchment illegal.
11. The principal question emerging in the present case is now settled by a catena of decisions of the Hon’ble Supreme Court is that reinstatement is not an automatic or mechanical cons
