1997 Supreme(Mad) 683
High Court of Judicature at Madras
THE HONOURABLE MR. JUSTICE P. SATHASIVAM
METTUR CHEMICALS PODHU THOZHILALAR SANGAM, METTUR
Versus
CHEMPLAST SANMAR LIMITED, METTUR, CHEMPLAST SANMAR LTD. METTUR
W.P.Appeal No.6453 of 1997
Decided On : 11-07-1997
An employer is required to comply with Section 9-A of the Industrial Disputes Act, 1947, which prohibits employers from effecting any change in the conditions of service of workmen in respect of matters specified in the Fourth Schedule, without giving notice to the affected workmen.
Headnote:
INDUSTRIAL DISPUTES ACT - SECTION 9A - CHANGE IN CONDITIONS OF SERVICE - NOTICE REQUIREMENT - SETTLEMENT - TERMINATION - CONTINUANCE OF BENEFITS - MAINTAINABILITY OF WRIT PETITION AGAINST PRIVATE EMPLOYER - INDUSTRIAL DISPUTES ACT, 1947.
Fact of the Case:
Petitioners, Mettw Chemicals Podhu Thozhilalar Sangam and Chemplast Employees Union, Mettur Dam, filed writ petitions seeking a mandamus directing the respondent not to discontinue the existing benefits, namely regular fixed monthly payment, covered by the settlement dated November 27, 1992, without giving notice under Section 9a of the Industrial Disputes Act, 1947 (the Act). The respondent, a private company, contended that the writ petitions were not maintainable and that there was no change in service conditions of the members of the petitioner union.
Finding of the Court:
The court held that the writ petitions were maintainable against the respondent private management, as the extraordinary jurisdiction under Article 226 of the Constitution of India could be invoked to protect the fundamental rights of the workmen and to prevent a monstrosity of the situation. The court further held that the respondent was required to comply with Section 9-A of the Act, which prohibits employers from effecting any change in the conditions of service of workmen in respect of matters specified in the Fourth Schedule, without giving notice to the affected workmen.
Issues: 1. Whether the writ petitions were maintainable against the respondent private management? 2. Whether the respondent was required to comply with Section 9-A of the Act before discontinuing the existing benefits?
Ratio Decidendi: 1. The court held that the writ petitions were maintainable against the respondent private management, as the extraordinary jurisdiction under Article 226 of the Constitution of India could be invoked to protect the fundamental rights of the workmen and to prevent a monstrosity of the situation. The court relied on the proposition that a writ will issue against a private body to protect the fundamental rights declared under Part III of the Constitution of India, and that a writ will issue in extraordinary circumstances if the monstrosity of the situation warrants it. 2. The court held that the respondent was required to comply with Section 9-A of the Act, which prohibits employers from effecting any change in the conditions of service of workmen in respect of matters specified in the Fourth Schedule, without giving notice to the affected workmen. The court found that the discontinuance of the existing benefits constituted a change in the conditions of service of the workmen, and that the respondent had not given the required notice.
Final Decision: The court allowed both writ petitions and directed the respondent to continue the existing benefits covered by the settlement dated November 27, 1992, until a fresh settlement was arrived at.
( 1 ) THE above writ petitions are filed by Mettw Chemicals Podhu Thozhilalar Sangam and Chemplast Employees Union, Mettur Dam for a relief of mandamus directing the
respondent not to discontinue the existing benefits, namely regular fixed monthly payment, covered by the settlement dated November 27, 1992 without giving notice under Section 9a of the Industrial Disputes Act, 1947 (hereinafter referred to as "the Act" ). The same may be disposed of by the following common order.
( 2 ) THE case of the petitioner Union is that the respondent company has been making enormous profits and the workmen are outside the purview of the payment of Bonus Act. Hence, the management offered a fixed monthly payment to the workmen who were outside the purview of Payment of Bonus Act. In those circumstances, a settlement dated November 27, 1992 under Section 18 (1) of the Act between the respondent and the various unions, providing for fixed monthly payment of 56. 5 per cent of wages of April, 1992 every month For the period from April 1, 1991 to March 31, 1997 along with monthly wages. Rs. 500/-from the aforesaid amount is treated as fixed D. A. , and P. F. , Gratuity, overtime and medical reimbursement benefits are given on the said amount of Rs. 500/- treating it as fixed Dearness Allowance. The said settlement was in operation from April 1, 1991 to March 31, 1997. It is further contended that as the settlement was to expire on March 31, 1997 the petitioner gave a notice dated December 31, 1996, terminating the settlement dated November 27, 1992 under Section 19 (2) of the Act. Thereafter the respondent sent a letter dated March 5, 1997 referring to the petitioners letter dated December 31, 1996 terminating the settlement, stating that the continuation of settlement would have been in the best interest of both workmen and the management and since the union terminated the settlement, the monthly payment hitherto paid under the settlement will cease to be paid from April 1, 1997. Thereafter, the union placed a charter of demands dated March 20, 1997 demanding revision in the fixed monthly payment from 56. 5 per cent to 120 per cent. Talks were held on many days, but the respondent is not willing to increase the quantum of monthly payment, which the workmen are receiving from April 1, 1991 onwards. According to them, the liability to pay monthly fixed payment ceased to exist from April 1, 1997 since the settlement was terminated. It is further submitted that the decision of the respondent to discontinue the existing benefits namely the monthly fixed payment, is altering the conditions of service to the disadvantage of the workmen. This will reduce the wages of the workmen. Section 9-A of Industrial Disputes Act places prohibition on so the employer to effect any change in the conditions of service of any workmen in respect of matters specified in the IV Schedule of Industrial Disputes Act, without giving notice, to the workmen likely to be affected, in the prescribed manner. There is a prohibition on both workmen and the employer to seek a fresh settlement during the currency of settlement and the parties have to terminate the settlement on its expiry under Section 19 (5) of the Act, before seeking fresh settlement. It is settled law that without terminating a settlement on its expiry no fresh charter of demands can be placed. Finally it is submitted that the employer is bound to pay the benefits under the settlement even after its expiry/termination until a new settlementl award replacing earlier settlement. In those circumstances, they prayed for necessary direction for continuance of the existing benefits covered by settlement dated November 27, 1992.
( 3 ) THE respondent has filed a separate but identical counter affidavit in both the cases. The main defence is briefly stated hereunder :-The present writ petitions are not maintainable on the ground that the respondent herein is a private employer and does not come within the mea