Termination from private service by giving two month's basic

also whether applicant is entitled to performance pay if the employee remains in service during plan year  "I mean april 2013 onwards"

Dear Ravi,

If employee job nature is peermanent and he is working more than 240 days in the same org. or his probation has been confirmed than in normal course, employeer first responsiblity is to provide him the opportunity at any other location if there is an opration. If employee is ready to move. Elese your employement terms and condition as per the rule applied.

You can claim for the three month of gross pay in lue of also. As per retranchement rule employer is liable to pay the same.

Employees terminated by an employer have certain rights. An employee has the right to receive a final paycheck, the option of continuing health insurance coverage, and may be eligible for severance pay and unemployment compensation benefits.

Learned experts/members have given valuable advice.Kindly follow it.

You have posted that:

--“applicant is a permannant employee  for which certified standing order applies"

The employer should display standing orders on notice board and should supply the certified copy to employee on nominal payment say Rs.10/-

You may apply to obtain the certified copy from employer (appointing authority, MD, concerned HR personnel…) in writing under acknowledgment.

The guiding rules to lay off/retrenchment/termination shall culminate from standing orders, appointment letter, statue…..

If both the certified standing orders and the model standing orders are silent or in cases where the Industrial Employment(Standing Orders) Act is not applicable then the power to lay off has to be found in the contract of employment which is the appointment letter. If the appointment letter is also silent then the employer has no power to lay off and if he lays off his workmen, they are entitled to full wages for the period for which they were laid off.

--“Pinciples have been confirmed that assignment was dissolved  due to chage in operation plans , you have been found excess in the department, further your skills cannot be gainfully utilised in any other departments of the organization

The language seems to confirm that you have been laid off/retrenched.

Are you in the knowledge that there exists opportunities where you can work? Find out, and offer to be there.

As you have mentioned the standing orders of the company are certified there might be works committee, grievance redressal committee. Standing orders are certified after deliberations and negotiations by management, workers, and certified by certifying authority which may be DLC in your case.

Who is the current chairman of the committee: employee or employer and who are the members? You may approach them in writing under acknowledgment.

(The Industrial Disputes Act, 1947, CHAPTER II, AUTHORITIES UNDER THIS ACT:

3. Works Committee.—)

The term Industry does not mean factory alone. The Standing Order Act is applicable to all establishments to which the Payment of Wages Act, 1936 applies.

--“my query  " initial agreement two month's gross salary mentioned”

It should stand until or unless a change in service conditions have been accepted by you and effected.

--“in the appointment letter  no word "excess" mentioned"”

It implies company does not have a policy of 'Reduction in Force' which they take as a basis of Layoff. Thus employer might not have right to lay off/retrench.

--‘ also whether applicant is entitled to performance pay if the employee remains in service during plan year’

The answer seems to be yes.

It shall be appropriate to lodge a demand for it in writing under acknowledgment and thereafter FNF statement/settlement may not be accepted in writing.

You have not mentioned your location.

In Maharashtra standing orders are applicable to establishment employing 50 or more employees.

https://www.mahashramm.gov.in/lc/services.html

You may carefully look into the SE Act applicable to your state as well.

“Section 38 of the Bombay Shops and Establishments Act gives power to the State Government to extend the application of the Payment of Wages Act to any class of establishments or any glass of employees to which the Bombay Shops and Establishments Act applies. Accordingly the State Government has extended the application of the Payment of Wages Act to establishments situated in Greater Bombay, Thane, Poona, Sholapur, Kolhapur and Nagpur.“

Approval of Standing Orders - Every employer covered under the Act has to prepare ‘Standing Orders’, covering the matters required in the ‘Standing Orders’. Five copies of these should be sent to Certifying Officer for approval. [section 3(1)]. ‘Certifying Officer’ means Labour Commissioner and any officer appointed by Government to be ‘Certifying Officer’. [section 2(c)].

The Certifying Officer will inform the Union and workmen and hear their objections. After that, he will certify the ‘Standing Orders’ for the industrial establishment. [section 5]. Till standing orders are certified, ‘Model Standing Order’ prepared by Government will automatically apply. [section12A].

Standing order should be displayed in English and local language on special notice boards at or near entrance of the establishment. [section 9]. Modifications of Standing Order shall be done by following similar procedure. [section 10].

Once the ‘Standing Orders’ are certified, they supersede any term and condition of employment, contained in the appointment letter. If there is inconsistency between ‘Standing Order’ and ‘Appointment Letter’, the provisions of ‘Standing Order’ prevail

’Lay off’ means failure, refusal or inability of employer on account of shortage of coal, power or raw materials or accumulation of stock or break down of machinery or natural calamity; to give employment to a workman on muster roll. - - ‘Lay off’ means not giving employment within two hours after reporting to work. - - Lay off can be for half day also. In such case, worker can be asked to come in second half of the shift. [section 2(kkk)].

Retrenchment – ‘Retrenchment’ means termination by the employer of service of a workman for any reason, other than as a punishment inflicted by a disciplinary action. However, ‘retrenchment’ does not include voluntary retirement or retirement on reaching age of superannuation or termination on account of non-renewal of contract or termination on account of continued ill-health of a workman. [section 2(oo)].

‘Retrenchment’ means discharge of surplus labour or staff by employer. It is not by way of punishment. The retrenchment should be on basis of ‘last in first out’ basis in respect of each category, i.e. junior-most employee in the category (where there is excess) should be retrenched first. [section 25G]. If employer wants to re-employer persons, first preference should be given to retrenched workmen. [section 25H].

A worker who has completed one year of service can be retrenched by giving one month notice (or paying one month’s salary) plus retrenchment compensation, at the time of retirement, @ 15 days’ average wages for every completed year of service (section 25F).

IN case of Industrial Establishment:

-Employing > 100 workers: Chapter V-B of the Industrial Disputes Act prohibits lay off without prior permission of the appropriate government or authority constituted by the appropriate government for such permission.

Refer to specific conditions in Sec 2{kkk} of ID Act. Establishment may apply in Form Q-3. The authority shall evaluate the application applied for is really lay off or not.

-Employing <100 workers no special permission is required.

-Employing< 100 workers but IESO are applicable the employer is requested to pay 50% of the total of basic and Dearness Allowance during the period of lay off.

-Employing<50 workers the provisions relating to lay off provided in Chapter V-A are not applicable. Employer can give lay off. In the absence of service conditions providing for 50% of total of basic wage and allowances as a lay off compensation, employer may pay 100% of the wages.

Assess what is actual intention of the company lay off/retrenchment/closing off the establishment.

ID Act Sec 2{KKK}

During lay off days the workers who have been in continuous service for at least one year are to be paid lay off compensation @ 50% of the normal wages. However, no compensation shall be paid if such lay off is extended for a period beyond 45 days.

Section 25A(1)- Chapter V-A is applicable to industrial establishments employing 50 or more workmen but less than 100.

Section 25K….. Chapter V-B is applicable to industrial establishments employing 100 or more persons.

Industrial Disputes Act prescribes the procedure to be followed in case of lay-off, retrenchment or closure and does not confer any power on the employer to lay-off, retrench or for closure. Therefore the power to lay-off has to be found in the certified standing orders, or model standing orders.

Designation alone does not decide employee is a workman or not.

A competent and experienced labor consultant/service lawyer may ask the employee to provide answers to a set of questions and can evaluate employee shall fall within the category of workman or not.

Compile the facts of your case and approach a competent and experienced labor consultant/service lawyer and devise the strategy that would be most beneficial and you would like peruse and proceed under expert advice of your lawyer.

You may find the attachements useful.

Valuable advice of learned experst/members is sought.

Attached:

Attached.

Dear All,

Iam from hyderbad,

industry name:: engineering construc tion company

my designation::asst manager

question::Can a writ of Manadamus lies :: when Section 47 of SE act violated (speaks that  termination is only based on misconduct for permamanent employees).

when termination order is violative terms and conditions of appointment , can such a plea succed in Civil Suit

i want to take like this:: My age is 38 Years and the permamnant person term is 58 years

and the two month's salary for termination is void in view of section 48 of SEact r/w section 23 of Indian contract act.

58 yeras - 38 years (my age )  = 20 years

can i file a suit for compensation for 20 years salary  for violating the contract.

please shed some light on this.

regards,

You have initiated a very interesting thread. Probably you have gone thru the details and court cases on “section 23 of indian contract act” and SE Act of AP and formed a strategy. There are brilliant lawyers and brilliant judges.

Your efforts may lead to a judgment having far reaching consequences for employee and employer.

Kindly keep this thread updated.

Valuable advice of learned experts/members is sought which shall help everyone and shall enrich the forum.

The discussion given below is heartfelt opinion only and you may finally consult your writ lawyer having mastery on SE Act of AP, and precedence’s set by court thru various judgments, and  proceed under expert advice of your lawyer.

Let your lawyer opinion be final on all points discussed in this thread.

SE Act AP:

It is felt that Sec 40 was the original section on Termination which with the effect of notifications culminated into present Sec 47.

You have posted that “Section 47 of SE act violated (speaks that  termination is only based on misconduct for permamanent employees).”

This is probably the language of Sec 40.

The present Sec 47 is probably as:

“(1) No employer shall, without a reasonable cause terminate the service of an employee who has been in his employment continuously for a period of not less than six months without giving such employee atleast one month s notice in writing or wages in lieu thereof and in respect of an employee who has been in his employment continuously for a period of not less than one year, a service compensation amounting to fifteen days average wages for each year of continuous employment:“

However kindly obtain the latest version from Dept of Labor/SE Inspectorate/ or market and relate and finally decide at your end in consultation with your lawyer. SE Act of AP is attached.

Kindly look into:

Andhra High Court

Srinivasa Resorts Limited And ... vs State Of Andhra Pradesh And Ors. on 22 November, 2001

The court has dissected the SE Act with clinical precision, and has concluded:

“60. For the reasons aforementioned, we hold that the Sub-sections (3) and (4) of Section 47 of the Shops Act are unconstitutional and amounts to unreasonable discrimination and violative of Article 14 of the Constitution of India. Let a writ of mandamus issue accordingly. Writ petition is disposed of accordingly. No order as to costs”

After making striking observations and some scathing remarks:

“The A.P. Shops and Establishments Act (Act No. 15 of 1966) was enacted in the year 1966. Section 40 of Act, 1966 provided for conditions for terminating the service of an employee and payment of gratuity. The said provision was amended in the year 1976 by reason of Act No.53 of 1976 and ultimately Act, 1966 was repealed by the present Act, 1988. Section 47 of Act, 1988 provides for conditions for terminating the services of an employee, payment of service compensation for termination, retirement, resignation etc. For convenience sake, the unamended Section 40 of Act, 1966, the amended Section as existed in 1976 as also Section 47 of Act, 1988 may be tabulated as under:”

“Sub-section (4) of Section 47………..thereof is arbitrary, oppressive, discriminatory and violative of Article 14 of the Constitution”

“main challenge in the writ petition is as to the constitutional validity of the provisions of

Sub-sections (3) and (4) of Section 47 of the Shops Act.”

‘16. Undisputedly, the constitutionality of the unamended provisions of Section 40(1) and (3) of Act, 1966 came up for consideration before a Division Bench of this Court in SURYAPET MARKET CO-OPERATIVE SOCIETY V. MUNSIF MAGISTRATE, SURYAKPET AND ORS., 1972 (2) ALT 163. The said provision was declared ultra vires Article 14 of the Constitution inter alia”

“Any law which is inconsistent with the provisions of the Constitution, to the extent of such inconsistency, is void and ineffective under Article 13 of the Constitution.”

‘18. Sub-section (1) of Section 47 provides that no employer shall without a reasonable cause, terminate the service of an employee”

‘20. Contract of service is basically a contract between the parties. Only when the conditions of service are governed by a statute, statutory provisions shall prevail over the agreed conditions.”

28. the Supreme Court held: “A piece of subordinate legislation does not carry the same degree of immunity which is enjoyed by a statute passed by a competent legislature.”

“75. In India arbitrariness is not a separate ground since it will come within the embargo of Article 14 of the Constitution.”

“We do not, therefore find much substance in the contention that the Courts cannot at all exercise judicial control over the impugned notifications. In cases where the power vested in the Government is a power, which has got to be exercised in the public interest, as it happens to be here, the Court may require the Government to exercise that power in a reasonable way in accordance with the spirit of the Constitution.”

42.

46. Where the Act is ambiguous the doctrine of justness and reasonableness must be invoked.

47. Can in a situation of this nature, the statute be interpreted to mean that even those who have left the service would be entitled to service compensation.

48. If the provisions of the Act to be given effect to, the same will be counterproductive.

58. The service conditions and the extent of their protection are not fundamental rights They are creatures of either statute or of the contract of employment. What Service conditions would be available to particular employees, whether they are liable to be varied, and to what extent are matters governed either by statute or the terms of contract. The legislature cannot be mandated to prescribe and secure particular service conditions

to the employees or a particular set of employees. The service conditions and the extent of their protection as well as the set of employees in respect of whom they may be prescribed and protected are all matters to be left to the legislature. Hence when a legislation extends protective umbrella to the employees of a particular class, ii cannot be faulted so long as the classification made is intelligible and has rational nexus to the object sought to be achieved.

--- The language of order of termination e.g. “further your skills cannot be gainfully utilised in any other departments of the organization”…. indicates lay off/retrenchment.

Is it confirmed that contentions of the employer are true, that there is no place/ no where in your company? If not it should be contested.

The faults with the actions of the employer may be probed, found and established.

Present Sec 47 states:

-“Provided that every termination shall be made by the employer in writing and a copy of such termination order shall be furnished to the Inspector having jurisdiction over the area within three days of such termination.“

(Has the employer supplied the copy to Inspector?)

Has the Inspector checked the contentions of the employer, on receiving the copy? Has the employer stated in writing to Inspector also that there is no place/ no where in the company?

Have you approached the Inspector on it or under Sec 47 (2)

which states:

"The services of an employee shall not be terminated by the employer when such employee made a complaint to the Inspector regarding the denial of any benefit accruing to him under any labour welfare enactment applicable to the establishment and during the pendency of such complaint before the Inspector."

If statements of the employer are false can Inspector write to employer and compel the employer to call back the order of termination/lay off/retrenchment? It is felt that Inspector is duty bound to submit his report. If you have knowledge of posts available where if you are placed you can remain employed, the matter should end with penalty to employer.

-“(4) Every employer shall give an order of appointment to his employee in the establishment before such employee joins the service and shall also furnish a copy of such order to the Inspector having jurisdiction over the area, within three days of issue of each such order:“

(Has the employer supplied the copy to Inspector? If no does employer want to conceal?)

---You have posted that:

“applicant is a permannant employee for which certified standing order applies"”

“two basic pay replaces the term "gross salary " in the orginal appointment letter’ ( What is the notice pay mentioned in certified standing orders?)

“when termination order is violative terms and conditions of appointment , can such a plea succed in Civil Suit” ( Generically speaking the answer seems to be yes however let your lawyer examine all details, documents, merits and opine finally on it.)

Kindly let your lawyers also examine the following:

 If both the certified standing orders and the model standing orders are silent or in cases where the Industrial Employment(Standing Orders) Act is not applicable then the power to lay off has to be found in the contract of employment which is the appointment letter. If the appointment letter is also silent then the employer has no power to lay off and if he lays off his workmen, they are entitled to full wages for the period for which they were laid off.

And let the opinion of your lawyer/law firm be final on it.

“58 yeras - 38 years (my age )  = 20 years

“can i file a suit for compensation for 20 years salary  for violating the contract.”

We sincerely wish that this happens and thus courts drill sense into the heads of unscrupulous employers which are in plenty in the market.

Although this may seem to be the righteous penalty on employer however it would be a big amount. Court has to decide.

Our apprehension is that the achievement of such an amount requires a brilliant plaint substantiated with facts, laws, citations, judgements setting precedences, and a brilliant lawyer.................

Courts needs to be convinced.

Based on the merits courts may be pleased to order reinstatement with lay off compensation.

However let your lawyers opine finally on it.

---Probably you want to hint from section 23 of Indian contract act; “it would defeat the provisions of any law; or involves or implies injury to the person, opposed to public policy” and r/w with Sec 48 of SE Act of AP.

Kindly attach the latest version of SE Act of AP and elaborate more for further discussion.

Valuable advice of learned experts/members is sought.

Attached:

Srinivasa Resorts Limited And ... vs State Of Andhra Pradesh And Ors. on 22 November, 2001

Kindly consult your lawyer as there might be other judgements by the High Court or Supreme Court setting precedences, which might be useful in your case.

The section and clause on payment of service compensation for termination was perhaps included in Sec 47 of SE Act of AP with noble and good intent to ensure lay off compensation.

Now counsel of a competent and experienced lawyer is needed to establish the purpose and validity of this section. In today ought scenario all states are to have such sections to tackle the nuisance being littered by unscrupulous employers.

Valuable advice of learned experts/members is sought.

What was his nature of job ?

The querist is silent over the long long advice and discussion being initiated by Doab and without his comments, it is not good to move ahead and take it to endless destiny.

The only question is  whether Shri Ravi is workman within the meaning of sec. 2S of the Industrial Disputes Act.For this his designation is not material but nature of work has to be seen.If he is a workman then his termination is ex-facie illegal for not following  sec 25G, 25F of the I.D.Act and the same can be challanged before labour court by reference under Sec 2A of the I.D.Act.

If he is not workman than the service condition would be decided on the basis of letter of appointment.If any term is violated by termination,then suit may lie for hreach of contract.

@ Mr. Tripathi,

Sir,

Kindly accept heartfelt thanks for guiding further in this very interesting thread and thus enriching the forum.

The querist Mr. Ravi has posted in his latest post that:

“Iam from hyderbad,

industry name:: engineering construc tion company

my designation::asst manager

question::Can a writ of Manadamus lies

and has posted in his first post that:

applicant is a permannant employee  for which certified standing order applies"