Case Note & Summary
The petitioner, K. Selvaraj, retired as a Special Grade Conductor from the Tamil Nadu State Transport Corporation (Kumbakonam) Ltd., Karur Region, on 29 February 2020. After his retirement, a wage settlement was entered into between the union and the management on 24 August 2022, but it was made applicable with retrospective effect from 1 September 2019. The petitioner claimed that he was denied the benefit of this wage settlement for the period from 1 September 2019 until his retirement. His terminal benefits, including gratuity and leave encashment, were settled without reference to the revised pay scales under the settlement. He therefore filed a writ petition under Article 226 of the Constitution of India seeking a mandamus directing the respondent to re-fix his pay scale from 1 September 2019 till his retirement, and to pay the difference of wages for the period from 1 September 2019 to 29 February 2020, along with revised terminal benefits and interest at 18% per annum. The respondent, though represented by counsel, did not advance any substantive argument; the court noted that the petitioner's stand could not be disputed. The court held that since the settlement was made applicable from a date prior to the petitioner's retirement, he was entitled to its benefits. Consequently, the High Court allowed the writ petition and directed the respondent Corporation to pay the differential benefits in respect of gratuity, provident fund, and leave salary within six months, with interest at 6% per annum from the date of retirement till the date of actual payment. No costs were awarded.
Headnote
A) Labour and Employment - Wage Settlement - Retrospective Application - Constitution of India, Article 226 - The petitioner, a retired Special Grade Conductor, sought revision of pay scale and terminal benefits based on a wage settlement dated 24.08.2022 which was made applicable from 01.09.2019, a date prior to his retirement on 29.02.2020. The respondent denied the benefit. Held: The petitioner is entitled to the differential benefits in respect of gratuity, provident fund, and leave salary. The respondent Corporation was directed to pay the differential amount with 6% interest per annum from the date of retirement till the date of payment, within six months from the date of receipt of a copy of this order (Paras 2-4).
Issue of Consideration
Whether a retired employee is entitled to the benefit of a wage settlement entered into after his retirement but made retrospectively applicable from a date prior to his retirement
Final Decision
Writ petition allowed. Respondent directed to pay differential gratuity, provident fund, and leave salary within six months from receipt of order copy, with 6% interest per annum from date of retirement till payment. No costs.
Law Points
- wage settlement made applicable retrospectively from a date prior to retirement entitles retired employee to revised pay scale and terminal benefits
- denial of such benefits is arbitrary and unjust
- interest payable on delayed differential payments
