Case Note & Summary
The petitioner, WIKA Instruments India Pvt. Ltd., challenged the judgment and award of the Labour Court dated 14 November 2011, which held that the termination of the respondent, Mrs. Swati U. Nowgaonkar, was illegal and directed her reinstatement with continuity of service and full back wages from 17 April 2008. The respondent was appointed as a Receptionist-cum-Telephone Operator on 19 June 2007 on probation for six months. The appointment letter stated that unless confirmed in writing at the end of probation, her services would automatically stand terminated. The probation period ended on 19 December 2007, but no confirmation or termination letter was issued, and she continued working. On 17 April 2008, her services were terminated by a letter stating that her performance was not satisfactory and she did not improve, and as per Clause 1.3 of the appointment letter, her services stood terminated. She was offered one month's salary in lieu of notice and a cheque of Rs. 22,728 as full and final settlement. The respondent raised an industrial dispute, which was referred to the Labour Court. The Labour Court held that the termination was illegal as it was stigmatic and required a domestic inquiry, and awarded reinstatement with full back wages. The High Court upheld the Labour Court's award, finding no perversity or error of law. The court held that the automatic termination clause could not be used to terminate services without inquiry when the termination was based on unsatisfactory performance, which was stigmatic. The court also noted that the petitioner failed to prove that the respondent was gainfully employed elsewhere. The writ petition was dismissed.
Headnote
A) Industrial Law - Termination of Probationer - Automatic Termination Clause - Validity - The appointment letter contained a clause that unless the probationer was confirmed in writing, her services would automatically stand terminated at the end of probation period - The court held that such automatic termination clause cannot be used to terminate services without inquiry when the termination is stigmatic and based on unsatisfactory performance - The termination was held to be illegal as it was punitive and required a domestic inquiry (Paras 2-3, 5-6). B) Industrial Law - Stigmatic Termination - Requirement of Inquiry - The termination letter stated that the respondent's performance was not satisfactory and she did not improve - The court held that this amounted to a stigmatic termination, which could not be effected without holding a domestic inquiry - The Labour Court correctly held the termination illegal (Paras 3, 5-6). C) Industrial Law - Reinstatement with Back Wages - Entitlement - The Labour Court awarded reinstatement with continuity of service and full back wages from the date of termination - The High Court upheld the award, finding no perversity or error of law - The court noted that the petitioner failed to prove that the respondent was gainfully employed elsewhere (Paras 1, 6-7).
Issue of Consideration
Whether the termination of the respondent, a probationer, without holding a domestic inquiry, on the ground of unsatisfactory performance, is legal and valid, and whether the Labour Court's award of reinstatement with full back wages is sustainable.
Final Decision
The High Court dismissed the writ petition and upheld the Labour Court's award dated 14 November 2011, directing reinstatement of the respondent with continuity of service and full back wages from 17 April 2008.
Law Points
- Automatic termination clause in appointment letter is invalid if termination is stigmatic
- Termination of a probationer without inquiry is illegal if based on unsatisfactory performance
- Section 2A of Industrial Disputes Act
- 1947 applies to individual workman
- Reinstatement with full back wages is proper remedy for illegal termination
