Daily wagers not entitled to regularisation but can claim monetary compensation for illegal retrenchment – SC

Bharat Sanchar Nigam Ltd. Vs. Man Singh (Supreme Court) –  The Supreme Court has stated that though the employer might have violated the retrenchment rules under the Industrial Disputes Act, daily wage employees who have worked for a long time in an establishment are not entitled to regularisation. They can only claim monetary compensation. In this case, the workers were on daily wages since 1984 and their services were terminated in 1991 due to non-availability of work.

They requested the government to refer the matter to the labour court. It ordered BSNL to reinstate the employees. The government telecom company appealed to the high court without success. But in the second appeal, the Supreme Court ruled that the workers were not entitled to regularisation merely because they had worked for one year. Though the retrenchment may be set aside as illegal, an award of reinstatement should not be passed. As monetary compensation, the employees were awarded Rs 2 lakh each.

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

Bharat Sanchar Nigam Ltd. Vs. Man Singh

CIVIL APPEAL NO. 8747 OF 2011

(Arising out of SLP(C) No.7935/2007)

WITH

Bharat Sanchar Nigam Ltd. Vs. Mani Ram

CIVIL APPEAL NO. 8748 OF 2011

(Arising out of SLP(C) No.9997/2007)

AND

 Bharat Sanchar Nigam Ltd. Vs. Sewa Ram

CIVIL APPEAL NO. 8749 OF 2011

(Arising out of SLP (C) No.13183/2007)

O R D E R

1. Delay condoned. Leave granted.

2. We have heard the learned counsel for the parties.

3. The respondents workmen worked with the appellant as casual labourers on daily wages during the year 1984-85. Due to non-availability of work, their services were terminated in the year 1986. No notice or retrenchment compensation was given to them before terminating their services. After about five years, they raised an industrial dispute in the year 1991. The appropriate Government referred the dispute to the Labour Court for adjudication. The Labour Court vide its award dated 27.5.2005 ordered reinstatement of the respondents-workmen on the same post which they were holding at the time of their termination.

4. The award of reinstatement passed by the Labour Court was challenged by the Department by filing writ petitions before the High Court. The High Court after hearing the learned counsel for the parties and going through the records of this case, dismissed the writ petitions filed by the Department. The appellant is thus before this Court.

5. This Court in a catena of decisions has clearly laid down that although an order of retrenchment passed in violation of Section 25-F of the Industrial Disputes Act may be set aside but an award of reinstatement should not be passed. This Court has distinguished between a daily wager who does not hold a post and a permanent employee.

6. In view of the aforementioned legal position and the fact that the respondents – workmen were engaged as ‘daily wagers’ and they had merely worked for more than 240 days, in our considered view, relief of reinstatement cannot be said to be justified and instead, monetary compensation would meet the ends of justice.

7. Accordingly, the impugned judgement passed by the High Court as also the award dated 27.5.2005 passed by the Labour Court are set aside. We direct the appellant Bharat Sanchar Nigam Ltd. to pay Rs. 2 lakhs to each of the respondents in full and final settlement of their claim, within six weeks from today. In case the payment is not made within the aforementioned stipulated time, the amount shall carry interest at the rate of 12% per annum.

8. These appeals are accordingly allowed to the aforesaid extent. The parties are directed to bear their own costs.

…………………J. (DALVEER BHANDARI)

…………………J. (DIPAK MISRA)

New Delhi;

October 14, 2011

NF