Long-Term Contractual Work Under MGNREGA Funds Doesn't Bar Regularization if Work is Perennial and Skilled: Himachal Pradesh High Court - 2025-09-01

Legal Awareness & Information.

HP High Court Orders Regularization of Computer Operators, Slams State's "Ad-Hocism"

Shimla, HP – In a significant ruling championing the rights of long-serving contractual employees, the Himachal Pradesh High Court has directed the state government to regularize the services of numerous Computer Operators who have been working for over 18 years. Justice Sandeep Sharma, delivering the judgment, held that the state cannot deny regularization by citing that employees were paid from a centrally sponsored scheme like MGNREGA, especially when their work is perennial and skilled in nature.

The court allowed a batch of petitions filed by Mandeep Kumar and others, ordering that their services be regularized from October 9, 2017, the date they were granted a regular pay scale.

Background of the Case

The petitioners were appointed as Computer Operators on a contract basis between 2006 and 2008 in various Development Blocks and Rural Development agencies across the state. Although initially appointed with a fixed remuneration, they were granted a regular pay scale in 2017, identical to their permanently appointed counterparts.

Despite completing the six-year service period stipulated in the state’s 2012 regularization policy and serving for nearly two decades, their services were not made permanent. This compelled them to approach the High Court, seeking an end to their prolonged contractual status.

Arguments at the Bar

Petitioners' Stance: Represented by Advocate Onkar Jairath, the petitioners argued that the state's refusal to regularize them was "patently illegal, arbitrary, and discriminatory." They contended that: - They have been performing the same duties as regular employees and receiving a regular pay scale since 2017. - The state had previously regularized similarly situated individuals, like Rakesh Kumar and Harish Sharma, following court directives, establishing a clear case for parity. - The state's reliance on the MGNREGA funding source was a mere pretext, as the nature of their skilled work as Computer Operators falls outside the ambit of the MGNREGA, which is intended for "unskilled manual work."

State's Defense: Advocate General Anup Rattan, appearing for the state, countered that: - The petitioners were engaged under the centrally-funded MGNREGA scheme, and their employment was co-terminus with the project. - Regularizing them would impose a permanent financial burden on the state exchequer. - Their initial appointment was not made through the standard recruitment channels like the HP Public Service Commission. - The previous regularizations were exceptional cases based on specific court orders and should not be considered a precedent.

Court's Analysis and Key Observations

Justice Sandeep Sharma dismantled the state's arguments, emphasizing that the government, as a model employer, cannot engage in exploitative "ad-hocism."

The court made several pivotal observations:

"Continuing an employee on contract for long years, not following pay parity or granting pension, would not be to the satisfaction of the theme and spirit of Articles 14 and 16 of the Constitution of India."

• On MGNREGA Funding: The court noted that the petitioners, being skilled Computer Operators, could not have been appointed for "unskilled manual work" under the MGNREGA. It concluded that the state, recognizing its need for manpower, simply utilized the scheme's funds to meet the expenditure. The judgment stated, "Mere mention of the fact that salary/remuneration...shall be paid from MGNREGA funds, may not be a ground to deny regularization."

• On Perennial Nature of Work: The court reasoned that the state's own actions—creating 93 posts with the Finance Department's approval, continuing the petitioners' services for over 18 years, and granting them a regular pay scale—proved that the need for their work was permanent, not temporary.

• Principle of Parity: The judgment highlighted that the state had already regularized other employees in identical situations, making the denial of similar benefits to the current petitioners discriminatory.

• Citing Supreme Court Precedents: The court invoked the Supreme Court's judgment in Dharam Singh vs. State of U.P. , which deprecated the practice of extracting regular labor under temporary labels and stated that "financial stringency...is not a talisman that overrides fairness, reason, and the duty to organize work on lawful lines."

Final Verdict and Implications

Finding merit in the petitions, the High Court allowed them and issued a clear directive to the state government.

"The respondents are directed to regularize the services of the petitioners with effect from the date they were granted regular pay scale i.e. 9th October, 2017..."

This ruling provides significant relief to the long-serving Computer Operators and sets a strong precedent against the misuse of project-based or scheme-based appointments to deny permanent employment to individuals performing perennial duties. It reinforces the constitutional obligation of the state to act as a model employer and ensure fairness and security of tenure for its workforce.