Case Note & Summary
The petitioner, IDBI Bank Ltd., challenged an order passed by the Central Government Industrial Tribunal at Mumbai on an application under Section 33 of the Industrial Disputes Act, 1947. The bank had outsourced non-core activities such as housekeeping to two contractors, respondent nos. 2 and 3, who employed about 268 workers. The services of three workers were terminated by the contractors in 2005. An industrial dispute was raised, but the Central Government refused to make a reference. A writ petition (WP No. 429 of 2006) was dismissed by a Division Bench of the Bombay High Court on the ground that the workers were engaged by independent contractors and no employer-employee relationship existed between them and the bank. In March 2012, respondent no. 1 union raised a demand for regularization and permanency of these workers. The dispute was referred to the Tribunal, which passed an order granting approval under Section 33. The bank contended that the Tribunal had no jurisdiction to entertain the application as there was no employer-employee relationship. The High Court agreed, holding that the Tribunal's order was without jurisdiction and set it aside. The court emphasized that the earlier Division Bench decision was binding and that the workers were employees of the contractors, not the bank.
Headnote
A) Industrial Law - Section 33 of Industrial Disputes Act, 1947 - Jurisdiction of Industrial Tribunal - The Tribunal has jurisdiction to entertain an application under Section 33 only if there exists an employer-employee relationship between the applicant and the workmen concerned. In the present case, the workers were employed by independent contractors (respondent nos. 2 and 3) and not by the petitioner bank. The Division Bench of this Court had earlier held that no employer-employee relationship existed between the bank and the workers. Consequently, the Tribunal's order granting approval under Section 33 was without jurisdiction and liable to be set aside. (Paras 2-5)
Issue of Consideration
Whether the Central Government Industrial Tribunal had jurisdiction to entertain an application under Section 33 of the Industrial Disputes Act, 1947, seeking approval for termination of services of workers who were employed by independent contractors and not by the principal employer (IDBI Bank).
Final Decision
The petition is allowed. The impugned order of the Central Government Industrial Tribunal is quashed and set aside. Rule is made absolute accordingly.
Law Points
- Section 33 of Industrial Disputes Act
- 1947
- employer-employee relationship
- contractor versus principal employer
- outsourcing of non-core activities
- jurisdiction of Industrial Tribunal
Case Details
2018 LawText (BOM) (06) 45
Writ Petition No. 4395 of 2018
Mr. S.K. Talsania, Sr. Advocate with Mr. Milind Joglekar and Mr. Rahul D. Oak for Petitioner; Mr. Vinay Menon i/b Mr. Kishore Shetty for Respondents
Bhartiya Kamgar Sena, Rahul Management Services Pvt. Ltd, Mithil Management Services Pvt. Ltd
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Nature of Litigation
Writ petition challenging an order of the Central Government Industrial Tribunal under Section 33 of the Industrial Disputes Act, 1947.
Remedy Sought
Petitioner (IDBI Bank) sought quashing of the Tribunal's order granting approval under Section 33.
Filing Reason
The Tribunal passed an order on an application under Section 33 despite the absence of an employer-employee relationship between the bank and the workers.
Previous Decisions
A Division Bench of the Bombay High Court in Writ Petition No. 429 of 2006 dismissed a petition on the ground that the workers were engaged by independent contractors and no employer-employee relationship existed with the bank.
Issues
Whether the Industrial Tribunal had jurisdiction to entertain an application under Section 33 of the Industrial Disputes Act, 1947, when there was no employer-employee relationship between the applicant (bank) and the workmen.
Submissions/Arguments
Petitioner argued that the workers were employees of the contractors, not the bank, and thus the Tribunal had no jurisdiction under Section 33.
Respondents contended that the workers were entitled to regularization and the Tribunal's order was valid.
Ratio Decidendi
An Industrial Tribunal under Section 33 of the Industrial Disputes Act, 1947, has jurisdiction only if there exists an employer-employee relationship between the applicant and the workmen. Where workers are employed by independent contractors and not by the principal employer, the Tribunal cannot entertain an application under Section 33.
Judgment Excerpts
It is the case of the petitioner that it had outsourced certain noncore activities such as housekeeping of various branches and offices in Mumbai and Thane region to outside agencies.
The services of three of these workers were terminated by the contractors sometime in 2005.
That writ petition, being writ petition no.429 of 2006, was dismissed by a Division Bench of this Court on the ground inter alia that the workers concerned were engaged by independent contractors and no employeremployee relationship could be established between them and the petitionerbank.
Procedural History
The petitioner bank outsourced housekeeping work to contractors. In 2005, three workers were terminated by contractors. An industrial dispute was raised, but the Central Government refused reference. A writ petition (WP 429/2006) was dismissed by a Division Bench. In March 2012, the union raised a demand for regularization. The dispute was referred to the Central Government Industrial Tribunal, which passed an order under Section 33. The bank filed the present writ petition challenging that order.
Acts & Sections
- Industrial Disputes Act, 1947: 33
