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2012 Supreme(Mad) 2207
Court of Judicature at Madras
K. CHANDRU, J.
The Management of Sundaram Fasteners Ltd.
Versus
The Presiding Officer Labour Court Salem & Others
W.P.Nos.22076 & 29671 of 2007 & M.P.No.1 of 2007
Decided on: 05-06-2012
For the Petitioner:S. Ravindran for M/s. T.S. Gopalan & Co, Advocates.
For the Respondents:V. Prakash for K. Sudalaikannu, Advocates.
The central legal point established in the judgment is the entitlement of workers to permanent status after a specified period of service, and the remedies of reinstatement and backwages in cases of illegal retrenchment.
Headnote:
Industrial Disputes Act - Employment Status - 2(s), 25-F, 25-N, 2(oo)(bb), 46 of 1981 - The court discussed the provisions of the Industrial Disputes Act, including the definitions of 'workman' and 'retrenchment', the requirement of prior approval for retrenchment, and the legal implications of termination due to unsatisfactory performance. The court also referred to the Tamil Nadu Act 46 of 1981, which deems workers to become permanent after a certain period of service. The judgment highlighted the principles of reinstatement and backwages as remedies for illegal retrenchment.
Fact of the Case:
The case involved a dispute between a worker and the management regarding the termination of the worker's employment. The worker claimed that despite serving for an extended period, he was not made permanent and was eventually terminated. The management contended that the worker was engaged on a temporary basis and there was no guarantee of permanent employment.
Finding of the Court:
The court found that the workers were covered by the Industrial Disputes Act and their continued engagement beyond the specified periods was contrary to the Certified Standing Orders. The court held that the termination was illegal and ordered compensation for the worker. It also emphasized the entitlement of workers to reinstatement and backwages in cases of illegal retrenchment.
Issues: The key issues included the employment status of the worker, the legality of the termination, and the entitlement of the worker to permanent status and compensation.
Ratio Decidendi: The court held that the workers were entitled to permanent status after a certain period of service and that the termination without proper procedure amounted to illegal retrenchment. The court also emphasized the principles of social justice and the need to protect the rights of workers in line with the constitutional philosophy.
Final Decision: The court allowed the worker's petition, ordering reinstatement with backwages and continuity of service. The management's petition was dismissed.
Certainly. Based on the provided legal document, the key points are as follows:
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Entitlement to Permanent Status: Workers who serve beyond a certain period are deemed to be entitled to permanent employment status, regardless of initial temporary or probationary designations (!) (!) .
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Illegal Retrenchment and Remedies: Termination of workers without following proper procedures, such as prior notice and approval, constitutes illegal retrenchment. In such cases, workers are entitled to reinstatement, with backwages and continuity of service (!) (!) (!) .
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Service Period and Deemed Permanency: Workers engaged continuously for over 480 days within a period of 24 months are generally considered to have acquired permanent status, especially when their employment is extended beyond initial training or probation periods without proper termination procedures (!) (!) .
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Application of Labour Laws and Social Justice Principles: The interpretation of labour statutes must align with constitutional goals of social justice, equality, and protection of workers’ rights. Courts are mandated to interpret social welfare legislation with a view to securing justice for workers, particularly when their livelihood is at stake (!) (!) (!) .
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Procedural Violations and Compensation: Termination without prior notice or proper enquiry renders the dismissal illegal. Compensation is a suitable remedy when procedural violations are established, and the amount awarded should reflect the principles of social justice (!) (!) .
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Deemed Permanent Status Under Special Legislation: Certain statutes, like the Tamil Nadu Act, automatically confer permanent status on workers after specified periods, independent of formal orders, emphasizing the constitutional aim of protecting workers’ rights (!) (!) .
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Judicial Approach and Social Welfare: The courts emphasize a pro-worker approach, especially in cases of illegal retrenchment, and advocate for interpretations that uphold workers’ rights over employer’s financial considerations, aligning with constitutional directives for social and economic justice (!) (!) .
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Final Court Decision: The court modified the original award, ordering reinstatement with backwages and continuity of service for the worker, while dismissing the management’s petition. Both parties were permitted to bear their own costs (!) .
These points highlight the legal principles regarding workers’ rights to permanent employment, procedural fairness in termination, and the courts’ role in ensuring social justice within labour law frameworks.
1. Both Writ Petitions challenge an award made in I.D.No.209 of 2005 dated 02.05.2006 passed by the 1st respondent Labour Court, Salem. The said Industrial Dispute was heard along with other Industrial Disputes and a common award was passed by the Labour Court, Salem on 2.5.2006. Insofar as the workman is concerned, it relates to I.D.No.209 of 2005 and the Labour Court granted in lieu of reinstatement a sum of Rs.1,25,000/- as full and final settlement of all claims together with cost of Rs.300/-. While the management filed the Writ Petition No.22076 of 2007 challenging the award in granting compensation, the workman filed W.P.No.29671 of 2007 challenging the award for not granting the relief of reinstatement with backwages.
2. The Writ Petition filed by the management was admitted on 29.06.2007 and in the 2nd Writ Petition filed by the workman, Notice regarding admission was ordered on 11.09.2007 and it is yet to be admitted. When the 1st Writ Petition came up on 16.02.2012, this Court directed the connected Writ Petition to be listed along with the 2nd Writ Petition as both challenge the same award. Accordingly, both Writ Petitions were heard together and a common order is passed.
3. In the Writ Petition filed by the management, interim stay was granted on 29.6.2007. The management has file a counter affidavit in the Writ Petition filed by the workman. It is also brought to the notice of this Court that the other workers who are covered by the industrial dispute have not chosen to challenge the award and they have settled their claims with the management.
4. The case of the workman was that the management engaged the manufacture of spare parts for two wheelers and four wheelers. It has got factories at Chennai, Hosur, Madurai and Puducherry. The workmen were engaged in Hosur Factory and it has got more than 100 workers and covered by Chapter V-B of the Industrial Disputes Act. The management was indulging in the practice of engaging workers for a long number of years as temporary trainee, apprentice, probationer, etc., thus it was indulging in unfair labour practice. The workman was appointed as trainee on 14.6.1997 upto 30.6.1998 and he was paid consolidated sum of Rs.1,675/-. After 1.4.1998, another allowance of Rs.250/- was paid. Though he was designated as a trainee, he was made to work in the regular establishment. After the expiry of the initial period of training, namely on 30.6.1998, he was not ousted from service. He continued in service for a further period from 1.7.1998 till 8.7.1998. He was paid wages by voucher payment by the management under the head of "Conveyance Allowance". Again on 9.7.1998, he was issued an order of appointment, appointing him as "Work Apprentice" on consolidated sum of Rs.1,925/- per month for a period of 12 months ending 31.7.1999. Prior to the second spell of appointment, a separate application was taken from the workman and on the expiry of the second period of employment, he was not ousted from employment but continued to be paid salary on a voucher under the head "conveyance allowance". He was given appointment order on 9.8.1999, appointing him from the said date as "Operative Trainee" on temporary basis on consolidated salary of Rs.2,175/- plus other allowances of Rs.250/- per mensem for a period of one year ending on 31.8.2000. Once again, another application was obtained from him before granting appointment. With effect from 1.4.2000, his consolidated salary was revised to Rs.2,425/- per mensem. On the expiry of the third spell of period on 31.8.2000, he was not ousted but he was given voucher payment under the head "conveyance allowance" for the period from 1.9.2000 to 11.9.2000. Thereafter, he was issued with another appointment order appointing him as "Operative Trainee Probationer" with effect from 12.9.2000 on a salary of Rs.3,600/-per month. The probation was prescribed for 6 months. Once again a fresh application was obtained from the workman. The probationary per
