I.D.Act vis a vis mgt's admistrative order/action

Industrial Disputes Act, 1947 – Vis a Vis - Management’s Administrative Orders/ Actions. The date of effect – 11th. March, 1947 By – ASHWINI KUMAR, Advocate (Senior Labour Lawyer) The Object – ”An Act to make provisions for the Investigation and settlement of Industrial Disputes and for certain other purposes”. Forum- Ø For the purpose of Investigation – The Conciliation machinery. Ø For the purpose of Settlement - The Conciliation machinery.(s.12) Mutual Effort (s.18) Ø If no settlement – Adjudication machinery- Labour Court, Industrial Tribunal. Via Appropriate government (S10) REFERENCE. It is an area which gives wide jurisdiction to the Labour Court and Industrial Tribunal, on the basis of Terms of Reference as per the matters included in SECOND & THIRD Schedule. The matters related to Schedules are directly linked with the actions and orders of the various authorities of the Management, because all such actions/ orders shall be the subject matter of Judicial scrutiny, curtailing prerogative of the management. SOME IMPORTANT MATTERS:- SECOND SCHEDULE: 1. The Propriety or legality of an order passed by an employer under under the Standing Order. 2. The application and interpretation of Standing Orders. 3. Discharge or Dismissal of Workmen including reinstatement of or grant of relief to workmen wrongfully dismissed. THIRD SCHEDULE: 10. Retrenchment of workmen and closure of establishment. 11. Any other matter that may be prescribed., These matters are of vital importance from the administrative point of View for the reasons:- A. Affect the discipline and other day to day affair. B. Involves prestige of the authority concerned. C. Possibility of large repercussion. D. Huge financial involvement. E. Affect the Industrial peace and harmony. If the Administrative Orders are sustained by the adjudicator: a. The discipline continues to be maintained. b. Prestige of the authority concerned is saved. c. Any repercussion is avoided. d. Financial involvement is curtailed and minimized. e. Over all supremacy of the management continues. Therefore the orders should be legally correct. Landmark decision of Supreme Court for speedy disposal of the cases pending in the Labour Court /Industrial Tribunal. 1. 1983 LIC 1483 (S.C) S.K.Verma Vrs. Mahesh Chandra & others. “2. There appear to be three preliminary objections which have become quite the fashion to be raised by all employers, particularly Public Sector Corporations, whenever and industrial dispute is referred to a tribunal or adjudication. One of the objection is that there is no industry, second is that there is no industrial dispute and the third that the workman is no workman. It is pity that when the Central Government, in all solemnity, refers an industrial dispute for adjudication, a public sector corporation which is an instrumentality of the State instead of welcoming a decision by the Tribunal on merits so as to above itself of any charge of being a bad employer or of victimization etc. should attempt to evade decision on merits by raising such objections and never thereby satisfied, carry the matter other times to the High Court and to the Supreme Court, wasting public time and money. We expect public sector corporations to be model employers and model litigants. We do not expect them to attempt to avoid adjudication or to indulge in luxurious litigation and drag; workmen from court to court merely to vindicate, not justice, but some rigid technical stand taken up by them We hope that public sector corporation will henceforth refrain from raising needless objections, fighting needless litigations and adopting needless postures.” 2. 1983 LIC 1629 (S.C) D.P.Maheshwari Vrs. Delhi Admn. and others. “1.It was just the other day that we were bemoaning the unbecoming devices adopted by certain employers to avoid decision of industrial disputes on merits. We noticed how they would raise various preliminary objections, invite decision on those objections in the first instance, carry the matter to the High court under Art. 226 of the Constitution and to this Court under Art. 136 of the Constitution and delay a decision of the real dispute for years, sometimes for over a decade. Industrial peace, one presumes, hangs in the balance in the meanwhile. We have now before us a case where a dispute originating in 1969 and referred for adjudication by the Government to the Labour Court in 1970 is still at the stage of decision of a preliminary objection. There was a time when it was thought prudent and wise policy to decide preliminary issues first. But the time appears to have arrived for a reversal of that policy. We think it is better that tribunals, particularly those entrusted with the task of adjudicating labour disputes where delay may lead to misery and jeopardise industrial peace, should decide all issues in dispute at the same time without tying some of them as preliminary issue Nor should High Courts in exercise of their jurisdiction under art. 226 of the Constitution stop proceedings before a Tribunal so that a preliminary issue may be decided by them. Neither the adjudication of this Court under art. 136 may be allowed to be exploited by those who can well afford to wait to the detriment of those who can ill afford to wait by dragging the latter from Court to Court for adjudication of peripheral issues, avoiding decision on issues more vital to them. Art. 226 and Art. 136 are not meant to break the resistance of workmen in this fashion. Tribunal and Courts who are requested to decide preliminary questions must therefore ask themselves whether such threshold part-adjudication is really necessary and whether it will not lead to other woeful consequences. After all tribunals like Industrial Tribunals are constituted to decide expeditiously special kinds of disputes and their jurisdiction to so decide is not to be stifled by all manner of preliminary objections and journeying up and down. It is also worthwhile remembering that the nature of the jurisdiction under art. 226 is supervisory and not appellate while that under Art. 136 is primarily supervisory but the Court may exercise all necessary appellate powers to do substantial justice……” Different Areas of actions need precaution: - 1. RECRUITMENT : 1. Issuance of letter of appoint.- required care – S.2(oo)(bb) 2. Obtaining Employees particulars: (a) Family members; (b) Age/Date of birth. Importance of (b) is vital in view financial involvement, administrative set up like change in the seniority list etc. because the problem comes at a later stage. Usual mistakes / errors experienced in course of conducting the cases.: 1. Pre- employment medical certificate used for the purpose of determination of age, in the event of non-availability of any proof of age/ date of birth. Not correct for the following reasons:- v The provision of Certified Standing Order/ Rule of age determination is something else. v While making a change the Principle of Audi Ateram Partem not followed properly. Case Law: 1967-II-LLJ 266 (S.C) Sate of Orissa Vrs. Binapani Dei. Ø The case related to wrong entry of date of birth in the Service Book. Ø The wrong entry was pointed out by virtue of an anonymous letter. Ø It was held by the Hon’ble Supreme Court “…The state has undoubtedly authority to compulsorily retire a public servant who is superannuated. But if that person disputed the claim, he must be informed of the case of the State and the evidence in support thereof and he must have a fair opportunity of meeting that case before a decision adverse to him is taken.” Proper to do: v The entry must be based on correct proof of age. v If age to be determined after employment, the workman must be sent to the Medical Officer, specifically for the purpose of age determination. [ S.O.No.7 (b)(ii)] v If management requires any information regarding age/ date of birth, it must be sure about the purpose and the same should be properly indicated in the letter asking for the information. If change is required to be made in the service book/service records to the disadvantage of the workman concerned, he must be given a chance finally to explain as to why the date of birth entered in the service book should not be changed. Management’s discretion: v When asked for by the workman to make a change at a belated Stage especially when the service book containing the entry contains his signature. Case Laws: 1983 LIC 162 (PAT) Baidya Nath Prasad Sinha Vrs. State of Bihar. Held- Persons ascertaining particular date as his date of birth cannot later on claim that the date of birth was wrongly recorded. Even Matriculation Certificate, not produced at the time of entry was not allowed to be accepted. 1992 (65) FLR 787 (S.C.) Executive Engineer, Bhadrak (R&D) Division, Orissa v. Rangadhar Malik. Held- Date of birth entered on the basis of horoscopes, which was accepted by the employee by putting his signature, against which a representation was made claiming another date of birth. The rejection by the management affirmed and approved by the Hon’ble Supreme Court. - 1993(82) FJR 301 (S.C.) Union Of India V. Harnam Singh. Application or change of date of birth must be made within reasonable time after entering into service. Application after 35 years just before superannuating does not merit consideration. Loss of Lien: As per Certified Standing Order: Standing Order No. 19(xi) Page 16. Case Laws: 1967-II-LLJ 883 National engineering Industries Vrs. Hanuman. Held- “When Standing Order provides that a workman will lose his lien on his appointment in case he does not join his duty within eight days of the expiry of his leave, it obviously means that the services are automatically terminated on the happening of the contingency. It is not understood how a workman who has lost his lien on his appointment can continue in service there after. Where, therefore, a Standing Order provides that a workman would lose his lien on his appointment, if he does not join his duty within certain time after his leave expires, it can only mean that his service automatically terminated when the contingency happens.” The decision of the Hon’ble Supreme Court ruled the ground till another decision was delivered by the Hon'ble Court in State Bank Of India Vrs. N.Suderamoney [1976 – LLJ 478 (S.C)]- While interpreting S. 2(oo) it was held ‘termination embraces not merely the act of termination by the employer, but the fact of termination howsoever produced’. “Retrenchment was held to mean to en, conclude, cease”. In the case their Lordships were considering the case of a person whose service came to an automatic end on the expiry of nine days. It was observed “automatically may be, but cessation all the same. There after a large number of cases were decided following the above case law. The concluding judgement was Mohan Lal Vrs. Bharat Electronics Ltd. case reported in 1981-II-LLJ 70. It was held that Termination without compliance with the provisions of S.25F renders the termination void abinitio and inoperative. There is no question of granting reinstatement because there is no cessation of service. A mere declaration follows that he continues to be in service with all consequential benefits. Following the decision amongst other decisions the Hon’ble Patna High Court also rendered the same decision in the case of Deshraj Sood Vrs. Industrial Tribunal & others reported in 1985-I-LLJ – 74. RECONSIDERATION BY LARGER BENCH.: 1990 (77) FJR 17/51 (S.C.) Punjab Land Development and Reclamation Corporation Ltd. & others Vrs. Labour Court, Chandigarh & others. The question for consideration was – What would happen to the rights of the employer under Standing Orders and under contract of employment in respect of the workmen whose services has been terminated? Ans. “There may be two answers to this question. Firstly, those rights may have been affected by introduction of Section 2(00), S.25F. and other relevant schemes. Secondly, it may be said that the right as such are not affected or taken away, but only an additional social obligation has been imposed on the employer so as to give the retrenchment benefit to the affected workman, perhaps for immediate tiding over of the financial difficulties. Looked at from this angle, there is implicit a Social Policy. As the Maxim goes Stat Pro ratione Volintas Populi , the will of the people stands in place of reason.” 1993 (83) FJR 271 (S.C) D.K.Yadav Vrs. J.M.A. Industries Ltd. Same principle followed – Principle of Natural Justice was made to follow. Held- “S.2(oo)- Retrenchment includes Termination of Service of workman by employer for any reason what so ever – Certified Standing Orders providing for cessation of employment on overstaying leave by 8 days without permission- cessation of employment is not Automatic- Principles of Natural must be read into such Standing Order. Termination of service without opportunity of hearing would be invalid.” 2001 LLR 54 (S.C) Scooter India Ltd. M.Mohammad Yaqub. Held- Failure of a workman to report for delay after the period stipulated in the Standing Order would amount to retrenchment. Management cannot presume that the workman has left the job despite being called upon to report failing which his name will be removed from rolls. 2001 – I – LLJ 174 (S.C) Punjab & Sind Bank & others Vrs. Sakattar Singh. Held - “4. A reading of Clause XVI of IV Bipartite Settlement will make it clear that in the even an employee absents himself from duty for 90 days or more consecutive days beyond the period of leave originally sanctioned or subsequently extended the Management may at any time thereafter, give a notice to employee at the last known address calling upon him to report for duty within 30 days of notice stating, inter alia, the grounds for the management coming to conclusion that the employee has no intention of joining duty and furnishing necessary evidence wherever relevant and unless the employee reports for duty within 30 days of the notice or gives an explanation for his absence satisfying the Management that he has not taken up another employment or avocation and he has no intention of not joining the duty, the employee will be deemed to have voluntarily retired from the Bank’s service on the expiry of the time fixed in the said notice in the event of the employee giving a satisfactory reply, he will be permitted to report for duty thereafter within 30 days from the expiry of the aforesaid notice to the Banks right to take any action under the law or rules of service. Under this rule the employee is given an opportunity to rejoin duty within stipulated time or explain his position to the satisfaction o the management that he has no intention of not joining duty, and a presumption will be drawn that the employee does not require the job any more and will stand retired from service, thus there is no punishment or misconduct but only to notice the realities of the situation resulting from long absence of an employee from work with no satisfactory explanation thereto. The principles of Natural Justice cannot be examined in vacuum without reference to the fact situation arising in the case. This rule has been incorporated in a agreement where representative of employees’ Union were parties. They also realised the futility of continuing a situation when an employee without appropriate intimation to the management is playing truant.” DISCIPLINARY ACTION: Some important precautions: - Charge Sheet must be properly drafted giving details of the alleged charges. - Charges must be such to be covered under misconduct enumerated in the Standing Order. Case Law. - 1985 – I – LLJ 527 (S.C) Shri Rasiklal Vaghajibhai Patel Vrs. Ahmadabad Municipal Corporation and another. Held- No disciplinary action could be taken and punishment imposed for conduct not included in enumerated misconduct in service regulation or standing order. - Enquiry must be held properly following the principle of Natural Justice and the rule indicated in the Certified Standing Orders. - After conclusion of Enquiry a copy o the enquiry report must be sent to the delinquent employee asking him whether he has to comment upon the enquiry. - The order must be passed considering the comments given by the delinquent employee and the Enquiry Report, by the disciplinary authority. Some important Case Laws: 1988(56) FLR 323 (S.C) Chandrama Tiwary Vrs. Union of India. Copies of relevant and material documents and statement of witnesses and statements of witnesses no supplied. Enquiry would be vitiated. 1994 LIC 762 (S.C) Managing Director ECILVrs B.Karunakar. The supply of enquiry report to the delinquent. Md. Raman Khan’s case (1991-I-LLJ 29 (S.C) made applicable from 20.11.1990. B.Karunakar’s case was remitted back to the Disciplinary Authority for holding the enquiry from the stage it was found defective. 1997 (75) FLR 403 (S.C) S,K,Singh Vrs. Central Bank of India & others. Non-supply of Enquiry Report to the delinquent , if not caused any prejudice, the enquiry would not be vitiated. Natural Justice a new concept.: 2005 (105) FLR 630 (S.C) Canara Bank Vrs. V.K.Awasthy. “8. The crucial question that remains to be adjudicated is whether principles of natural justice have been violated ; and if so, to what extent any prejudice has been caused. It may be noted at this juncture that in some cases it has been observed that where grant of opportunity in terms of principles of natural justice do not improve the situation ‘useless formality theory’ can be pressed into service.” “9. Natural justice is another name for common-sense justice. Rules of natural justice are not codified canons. But they are principles ingrained into the conscience of man. Natural justice is the administration of justice in a common sense liberal way. Justice is based substantially on natural ideals and human values. The administration of justice is to be freed from the narrow and restricted considerations which are usually associated with a formulated law involving linguistic technicalities and grammatical niceties. It is the substance of justice which has to determine its form.” Last but not the least, the loyalty of the officers of the higher level must be ensured even after they retire or otherwise. It has been experienced that the officer of the Managerial Level who were instrumental in passing the order present themselves before the court as witnesses against the management. Even those in service do not give enough support with a zeal to support the case of the management. Cases are lost due to the above reasons also. (Ashwini Kumar) Advocate.

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