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2025 Supreme(Mad) 3867

IN THE HIGH COURT OF JUDICATURE AT MADRAS
D. BHARATHA CHAKRAVARTHY, J.
The Management of Genau Extrusions Ltd. - Petitioner
Versus
The Presiding Officer, Labour Court, Salem & Ors. - Respondents
W.P.No.23460 of 2009 and M.P.No.1 of 2009
Decided On : 02-01-2025


Advocates Appeared:
For the Petitioner: Mr. K. Rangesh for Mr. Jayaraman & Associates.
For the Respondents: Labour Court, Mr. S.V. Navin Prabhu for Mr. K.V. Shanmuganathan.

The burden of proof for employment status lies with management, which must provide clear evidence to refute claims of direct employment by the workman.

Headnote:(A) Industrial Disputes Act, 1947 - Section 2-A(2) - Award challenging reinstatement and back wages - Workman employed through contractor - Dispute regarding employment status - Labour Court found Workman to be directly employed by management, leading to reinstatement with back wages. (Paras 1-5, 12)

(B) Employment Status - Burden of proof lies with the management to establish contractor relationship - Evidence initially unsupported by management’s arguments. (Paras 6-11)

(C) Relief granted - Modifications to award for reinstatement with back wages to compensation. (Para 13)

Facts of the case:
The Workman claimed employment with the management through a contractor and sought legal relief after being non-employed in 2002. Conciliation efforts failed.

Findings of Court:
The Labour Court established the Workman's direct employment status with the management and awarded re-instatement.

Issues: Key questions were the employment status of the Workman and appropriateness of relief.

Ratio Decidendi: The court ruled that despite management's claims regarding contractor employment, evidence supported direct employment.

Result: Writ petition partly allowed; compensation of Rs.2,00,000 awarded instead of reinstatement.

Table of Content
1. challenge against labour court's award. (Para 1 , 2 , 3)
2. labour court's findings and evidence. (Para 4 , 5)
3. arguments by management and workman. (Para 6 , 7)
4. court's analysis of evidence (Para 8)
5. court analysis of employment status. (Para 9 , 10 , 11)
6. consideration of relief options. (Para 12)
7. final decision and compensation awarded. (Para 13 , 14)

ORDER :

The writ petition is filed challenging the Award of the Labour Court dated 17.12.2008 made in ID No.485 of 2002. By the said Award, the claim petition filed by the Workman under section 2-A (2) of the I.D.Act was allowed and the Workman was granted the reliefs of reinstatement with back wages and continuity of service and other monetary benefits besides cost of Rs.1000/-.

2. The case of the Workman is that he was employed in the Second respondent management, even though through the first respondent Contractor, on 28.06.2001. As a matter of fact, in August 2001, when he was working as the machine operator, he also suffered an injury in his right hand fore finger and the claim was also made with Employee State Insurance Corporation by mentioning him, as if, he is the employee of the second respondent management. While so, thereafter in the year 2002, with effect from 10.07.2002, suddenly, he was non employed and hence, he raised a dispute. Conciliation failed. Thereafter, the claim petition is filed.

3. The claim petition was resisted by the respondent contractor who filed a petition specifically admitting that the Workman is their Workman and not that of the second respondent management. It is also further stated that the contractor is willing to offer employment to the petitioner in some other company. The claim is also resisted by the second respondent management on the ground that the Workman was never employed by them and he is the employee of the contractor. When the contractor is willing to offer employment in some other company, the petitioner has not accepted the same.

4. On the strength of the said pleadings, when the Labour Court took up the matter for inquiry, the Workman examined himself as PW1 and Exs.P1 to P7 were Marked. On behalf of the Respondents, two witnesses, namely one N.Murali and R.Velappan were examined and Exs.R1 to R18 were marked.

5. The Labour Court considered the case of the parties and first considered Exs. R4, R5 and R6, with reference to the claim made for the injury with the Employee State Insurance Corporation and found that since in the relevant column, it was not even specifically mentioned that the second respondent is a principal employer, the petitioner should be deemed to be their employee. The Labour Court, thereafter, found that the licence for engaging the contractor was later in point of time that is only on 21.06.2002, whereas the engagement is in the year 2001. The Labour Court also found that the employer's code number in Ex.R4 seems to have been interpolated, therefore, for all the reasons disbelieved the case of the management and held that the petitioner is a direct employee under the second respondent management and ordered reinstatement with back wages and continuity of service and other monetary benefits. Aggrieved by the same, the management is before this Court.

6. Mr.K.Rangesh, learned counsel appearing on behalf of the Management would submit that firstly, in this case, it can be seen that except for the claim made in the ESI Corporation, every other document, which is on record, categorically shows that the Workman was employed only by the first respondent contractor. The order of appointment is given only by the Contractor. Even the resume submitted by the Workman clearly records and undertakes that he was the employee only on the contractor. A perusal of the muster roll, it is clear that the wages are paid only by the contractor. The employer has also produced the agreement between the contractor and the management for supply of labour. In view thereof, when the management has categorically a

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