Case Note & Summary
The petitioner, Chowgule Industries Pvt. Ltd., challenged an order of the Industrial Court at Pune dated 9 January 2020, which allowed a complaint of unfair labour practice filed by respondent nos. 1 to 6 (original complainants). The complainants were employees of the petitioner who were charge-sheeted for misconduct and suspended pending enquiry. They were paid subsistence allowance at 50% of wages for the first 90 days and 75% thereafter, as per the Model Standing Orders. Their grievance was twofold: first, that they were entitled to 100% wages after 180 days of suspension, and second, that the quantum of wages considered for subsistence allowance was not in accordance with the minimum wages payable under the Minimum Wages Act. The Industrial Court held that the subsistence allowance should be calculated based on minimum wages under the Minimum Wages Act. The High Court examined the issue and held that subsistence allowance under the Standing Orders is not wages under the Minimum Wages Act, and the Minimum Wages Act does not apply to the calculation of subsistence allowance. The court allowed the writ petition, setting aside the Industrial Court's order and directing that subsistence allowance be paid in accordance with the Standing Orders.
Headnote
A) Industrial Law - Subsistence Allowance - Applicability of Minimum Wages Act - Subsistence allowance under Standing Orders is not wages under the Minimum Wages Act, 1948 - The Industrial Court erred in holding that subsistence allowance must be calculated based on minimum wages under the Minimum Wages Act - Held that subsistence allowance is governed by the Standing Orders and not the Minimum Wages Act (Paras 5-7).
Issue of Consideration
Whether the Minimum Wages Act applies to the calculation of subsistence allowance payable to suspended employees under the Model Standing Orders
Final Decision
The High Court allowed the writ petition, setting aside the Industrial Court's order and directing that subsistence allowance be paid in accordance with the Standing Orders, not the Minimum Wages Act.
Law Points
- Subsistence allowance under Standing Orders is not wages under Minimum Wages Act
- Minimum Wages Act does not apply to subsistence allowance
- Industrial Court erred in applying Minimum Wages Act to subsistence allowance
Case Details
2020 LawText (BOM) (01) 25
Writ Petition No. 4117 of 2019
Mr. Atul G. Damle a/w Mr. Rajesh Kinnerkar and Mr. Rupesh Lanjekar for the Petitioner, Mr. Nitin A. Kulkarni for Respondent Nos.1 to 6, Ms. Vaishali Nimbalkar, AGP for Respondent No.7-State
Chowgule Industries Pvt. Ltd.
Krishna Shrikant Kumbhar and Others
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Nature of Litigation
Writ petition challenging an order of the Industrial Court at Pune on a complaint of unfair labour practice regarding subsistence allowance.
Remedy Sought
Petitioner sought to set aside the Industrial Court order directing payment of subsistence allowance based on minimum wages under the Minimum Wages Act.
Filing Reason
The Industrial Court held that subsistence allowance should be calculated based on minimum wages under the Minimum Wages Act, which the petitioner challenged.
Previous Decisions
The Industrial Court at Pune passed an order on a complaint of unfair labour practice by respondent nos. 1 to 6, directing payment of subsistence allowance based on minimum wages.
Issues
Whether the Minimum Wages Act applies to the calculation of subsistence allowance payable to suspended employees under the Model Standing Orders.
Submissions/Arguments
Petitioner argued that subsistence allowance under Standing Orders is not wages under the Minimum Wages Act and the Minimum Wages Act does not apply.
Respondents argued that they were entitled to subsistence allowance based on minimum wages under the Minimum Wages Act.
Ratio Decidendi
Subsistence allowance under the Standing Orders is not wages under the Minimum Wages Act, 1948, and the Minimum Wages Act does not apply to the calculation of subsistence allowance.
Judgment Excerpts
It is not in dispute that for the first 90 days of their suspension, the complainants were paid subsistence allowance at the rate of 50 per cent of wages and 75 per cent of such wages for the remaining period of their suspension.
The Industrial Court held that the subsistence allowance should be calculated based on minimum wages under the Minimum Wages Act.
Subsistence allowance under the Standing Orders is not wages under the Minimum Wages Act, and the Minimum Wages Act does not apply to the calculation of subsistence allowance.
Procedural History
The complainants filed a complaint of unfair labour practice before the Industrial Court at Pune. The Industrial Court passed an order directing payment of subsistence allowance based on minimum wages. The petitioner challenged this order by filing a writ petition before the Bombay High Court.
Acts & Sections
- Minimum Wages Act, 1948:
- Model Standing Orders:
