Case Note & Summary
The dispute arose when timekeepers employed in the time office of the Central Railway Workshop and Factory, Parel, Bombay, filed applications before the Authority under the Payment of Wages Act, 1936, claiming overtime wages. They contended that they were ‘workers’ within the meaning of Section 2(1) of the Factories Act, 1948, and therefore entitled to overtime wages under Section 59 of that Act. In the alternative, they argued that even if they were not workers, Section 70 of the Bombay Shops and Establishments Act, 1948, read with the Factories Act, entitled them to overtime wages. The employer, the Works Manager, Central Railway, disputed the claim on both grounds. The Authority under the Payment of Wages Act found that only four of the respondents, who were required to work as progress timekeepers, could be considered workers under Section 2(1) of the Factories Act; the rest were merely employees of the workshop. However, the Authority accepted the alternative case based on Section 70 of the Bombay Shops and Establishments Act and directed the appellant to file a statement showing overtime wages due to each respondent and to pay the same. Aggrieved by this order, the Works Manager appealed to the Supreme Court by special leave. The core legal question was whether Section 70 of the Bombay Shops and Establishments Act, 1948, could be interpreted to give employees who are not ‘workers’ under the Factories Act the benefit of overtime wages under that Act. The appellant argued that Section 4 of the Bombay Act excluded the application of Section 70 to factories. The Supreme Court examined the relevant provisions. It noted that Section 70 of the Bombay Shops and Establishments Act consists of two parts. The first part excludes a factory and its employees from the operation of the Bombay Act. The second part, however, contains a non-obstante clause which provides that, notwithstanding anything in the Act, the provisions of the Factories Act relating to overtime wages shall apply to all employees working in a factory. The Court held that on a proper construction, the first part excludes the factory from the Bombay Act, but the second part, by its non-obstante clause, expressly makes the overtime wage provisions of the Factories Act applicable to all employees in the factory, irrespective of whether they are ‘workers’ as defined in Section 2(1) of the Factories Act. The Court further clarified that Section 4 of the Bombay Act applies only to establishments and not to factories; consequently, it did not affect the operation of Section 70. The Supreme Court thus affirmed the decision of the Authority under the Payment of Wages Act and dismissed the appeal. The Court held that all the respondents, as employees in the factory, were entitled to overtime wages under Section 59 of the Factories Act by virtue of Section 70 of the Bombay Shops and Establishments Act.
Headnote
A) Labour Law - Overtime Wages - Interpretation of Section 70, Bombay Shops and Establishments Act, 1948 - Extension of Factories Act provisions to non-worker employees - The Supreme Court held that Section 70 of the Bombay Shops and Establishments Act, 1948, by its non-obstante clause, entitles all employees in a factory to claim overtime wages under the Factories Act, 1948, even if they do not fall within the definition of ‘worker’ under Section 2(1) of the Factories Act. The first part of Section 70 excludes a factory and its employees from the operation of the Bombay Shops and Establishments Act, but the second part makes the relevant provisions of the Factories Act applicable to them. Section 4 of the Bombay Act applies only to establishments and does not affect the operation of Section 70. (Paras Not mentioned)
Issue of Consideration
Whether timekeepers employed in the time office of a railway workshop are entitled to overtime wages under Section 59 of the Factories Act, 1948, read with Section 70 of the Bombay Shops and Establishments Act, 1948, and whether Section 4 of the Bombay Act excludes the application of Section 70.
Final Decision
Supreme Court affirmed the decision of the Authority under the Payment of Wages Act. The Court held that Section 70 of the Bombay Shops and Establishments Act, 1948, by its non-obstante clause, entitles all employees in a factory to claim overtime wages under the Factories Act, 1948, irrespective of whether they fall within the definition of 'worker' under Section 2(1). Section 4 of the Bombay Act does not affect this interpretation. The appeal was dismissed.
Law Points
- Non-obstante clause in Section 70 of Bombay Shops and Establishments Act extends overtime wages protection to all factory employees
- not just workers under Factories Act
- Section 4 does not restrict Section 70
