Case Note & Summary
The judgment under consideration arises from a group of writ petitions filed before the High Court of Judicature at Bombay, Civil Appellate Jurisdiction, challenging four sets of identical awards passed by Labour Courts at Pune on references made under the Industrial Disputes Act, 1947. The petitioners were workmen of the respondent, a leading manufacturer of two and three wheelers in India with factories at Akurdi, Chakan, and Waluj. The dispute concerned temporary workmen employed at the Akurdi factory between 1984 and 1997. During this period, the respondent employed both permanent and temporary workmen; in 1997, there were about 6088 permanent and 4313 temporary workmen. The workmen alleged that the respondent followed a rotational system, employing temporary workers for a maximum of seven months, giving breaks, and re-employing them, thereby preventing completion of 240 days of continuous service and denying permanency. The work was claimed to be perennial in nature.
Some workmen filed complaints under the Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act, 1971, invoking Items 5, 6, and 10 of Schedule IV. The Industrial Court granted interim protection to about 400 workmen and finally allowed permanency to them, while rejecting complaints of 300 others on the ground that their services had already terminated and they should have approached Labour Courts. These orders led to writ petitions, then Letters Patent Appeals. A Division Bench allowed appeals, granting permanency to all 700 workmen. The respondent approached the Supreme Court, where a settlement was reached: permanency to 400 workmen and compensation to 300 as suggested by the Supreme Court.
Separately, about 300 workmen had filed letters of demand and conciliation proceedings under the Industrial Disputes Act, leading to references to Labour Courts. Four sets of awards answered the references in the negative. The present writ petitions were filed by subsets of these workmen challenging those awards. Writ Petition No. 4502 of 2006 was treated as the lead petition.
The court formulated three issues: (1) whether termination of temporary workmen fell within the exception to retrenchment under Section 2(oo)(bb) of the Industrial Disputes Act, or whether the rotational arrangement was not a fixed period contract; (2) whether Sundays and holidays counted towards 240 days continuous service and whether 240 days should be reckoned in the calendar year immediately preceding termination; and (3) whether a Labour Court should consider claims of permanency in a termination reference.
Senior counsel for the petitioners argued that the work was permanent, appointments were not due to temporary increase in work, and the rotational appointments were a strategy to deny permanency. The available text ends while recording these submissions; no final decision, reasoning, or operative directions are recorded in the extracted portion.
Headnote
A) Labour Law - Retrenchment - Exception under Section 2(oo)(bb) - Industrial Disputes Act, 1947, Section 2(oo)(bb) - The Court considered whether termination of temporary workmen under a rotational arrangement fell within the exception to retrenchment for non-renewal of a fixed term contract or stipulation in that behalf; petitioners contended that work was perennial and the rotation was a strategy to prevent 240 days continuous service and permanency. The text ends before any final holding is recorded (Paras 4-6).
B) Labour Law - Continuous Service - Reckoning of 240 Days - Industrial Disputes Act, 1947 and applicable Standing Orders - Whether Sundays and holidays during service counted towards 240 days aggregate service and whether 240 days were to be reckoned in the calendar year immediately preceding termination. The Court framed the issue for determination (Para 5).
C) Labour Law - Permanency Claims in Termination References - Industrial Disputes Act, 1947 - Whether a Labour Court dealing with termination of workmen in a reference should refuse to consider the workmen's claim of permanency. The Court framed the issue for determination (Para 5).
Issue of Consideration
Whether termination of temporary workmen under a rotational arrangement amounts to retrenchment or falls within Section 2(oo)(bb) exception; whether Sundays and holidays count towards 240 days continuous service and how 240 days are reckoned; whether Labour Court should consider permanency claims in termination references
Law Points
- Section 2(oo) Industrial Disputes Act 1947 defines retrenchment
- Section 2(oo)(bb) excludes termination on non-renewal of fixed term contract or stipulation
- 240 days continuous service under Standing Orders for retrenchment benefits
- Labour Court jurisdiction to consider permanency in termination references
- rotational temporary appointments may not be fixed period contracts if work is perennial
Case Details
2021 LawText (BOM) (02) 34
Writ Petition No. 4502 of 2006; with Writ Petition Nos. 9053 of 2005, 3175 of 2012, 3191 of 2012, 3192 of 2012, 3193 of 2012, 3194 of 2012, 3203 of 2012, 3204 of 2012, 3206 of 2012, 6516 of 2012, 6517 of 2012, 6518 of 2012, 6519 of 2012, 6520 of 2012, 6521 of 2012, 6522 of 2012, 6523 of 2012, 6524 of 2012; and Civil Application No. 2628 of 2015 in Writ Petition No. 6517 of 2012
Sanjay Singhvi, Jane Cox, Karishma Rao, V.P. Patil, S.D. Paithane, Manmohan A. Amonkar, J.P. Cama, K.M. Naik, Mac Bodhanwalla, Sheroy Bodhanwalla, Sakshi Sharma
Sunil Pralhad Khomane & Ors.; Hiralal Gulbhai Patel & Ors.; Laxman Bhonaji Dayalkar; Pramod Kisan Khete; Dhanajirao Bapu Patil; Kisan Sahebrao Gawli; Kishore Dattatreya Upare; Rajendrakumar Sheshamal Pipada; Kiran Sadhu Nagare; Vinayak Vaman Vidhate; Prashant Gopal Karmarkar; Ramesh B. Chintal; Suresh Yelvande; Subhash Govinddas Shah; Vijaybabu S. Silam; Chandrakant K. Randive; Shailendra Manohar Yande; Sanjay Madhavrao Naik; Sanjay Padmakar Kuvar
M/s. Bajaj Auto Ltd., Akurdi, Pune
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Nature of Litigation
Writ petitions challenging Labour Court awards that answered industrial references in negative
Remedy Sought
Petitioners (workmen) seek to challenge the Labour Court awards on various grounds
Filing Reason
Labour Courts rejected references made at the instance of workmen under the Industrial Disputes Act, 1947
Previous Decisions
Industrial Court allowed permanency to 400 workmen and rejected complaints of 300; High Court Single Judge dismissed workmen's petitions and allowed company's petition; Division Bench allowed appeals granting permanency to all 700; Supreme Court settlement gave permanency to 400 and compensation to 300; Labour Courts passed four sets of awards answering references in negative
Issues
Whether the termination of services of temporary workmen in the present case could be termed as termination as a result of non-renewal of the contract of employment on its expiry or under a stipulation in that behalf contained in the contract and thus, amounting to an exception to the definition of retrenchment contained in Clause (oo) of Section 2 of the ID Act? Or whether the rotational arrangement, such as the one in the present case, where there are continuous temporary engagements of the same workmen over long periods of time (adopted as a strategy to deny benefits of permanency to the concerned workmen), does not amount to an engagement on a fixed period contract so as to form an exception under sub-clause (bb) of Clause (oo) of Section 2 of the ID Act?
Whether, (a) Sundays and holidays during the period of service could be counted within 240 days as per the applicable Standing Orders so as to make up aggregate service of 240 days in a year within the meaning of the Standing Orders and (b) such 240 days should be reckoned as forming part of the calendar year of 12 months immediately preceding the dates of termination?
Should a Labour Court dealing with terminations of workmen in a reference under the ID Act refuse to consider their claim of permanency?
Submissions/Arguments
Petitioners argued that the work at the factory was perennial and permanent; appointments were not made as a result of any temporary increase in work; the work was always there, but appointments were made in a rotational manner for temporary periods so that at any given time workmen were appointed for a period of upto seven months.
Petitioners contended that the respondent followed a consistent practice of employing skilled as well as unskilled labour on temporary basis for a maximum period of seven months, giving breaks and re-employing them, thereby preventing completion of 240 days of continuous service and denying permanency.
Senior counsel for the petitioners flagged three main areas of controversy: treatment of rotational arrangement leading to termination of services of temporary workmen in the light of the definition of retrenchment and its exception in Section 2(oo) of the ID Act, reckoning of 240 days of continuous service within a year, and claims of permanency of the petitioning workmen and their consideration in industrial disputes concerning the workmen's terminations.
Judgment Excerpts
By the impugned awards, the references, made at the instance of workmen of the Respondent, were answered in the negative by the courts.
The present dispute concerns its workmen employed at Akurdi.
It is the workmen's case that though the work in the factory was of perennial nature, it was performed through temporaries from a pool of workers by a rotational system, seeing to it that throughout the relevant period none could complete 240 days of continuous service and thus keeping them away from secure permanent jobs.
The precise issues, which arise for the consideration of this Court, based on the submissions made across the Bar on these controversies, may be formulated thus...
Procedural History
Between 1984 and 1997, respondent employed temporary workmen along with permanent workmen; workmen alleged rotational system prevented 240 days continuous service. Some workmen filed unfair labour practice complaints under PULP Act Items 5, 6, 10 of Schedule IV; Industrial Court granted interim protection to about 400, final orders allowed permanency for 400 and rejected 300 for lack of jurisdiction. Writ petitions filed by workmen and company; Single Judge dismissed workmen's petitions and allowed company's petition. Division Bench in Letters Patent Appeals allowed appeals granting permanency to all 700. Respondent approached Supreme Court; settlement gave permanency to 400 and compensation to 300. Other workmen filed letters of demand and conciliation under ID Act; references made to Labour Courts. Four sets of awards answered references in negative. Present writ petitions filed challenging those awards; Writ Petition No. 4502 of 2006 treated as lead petition.
Acts & Sections
- Industrial Disputes Act, 1947: Section 2(oo), Section 2(oo)(bb)
- Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act, 1971: Schedule IV Item 1, Item 5, Item 6, Item 10
