SHOULD REINSTATEMENT AUTOMATICALLY FOLLOW IN A CASE WHERE THE ENGAGEMENT OF A DAILY WAGER HAS BEEN TERMINATED IN VIOLATION OF SECTION 25-F OF THE INDUSTRIAL DISPUTES ACT, 1947.
The legal footing earlier was that if the court found that the termination was illegal, reinstatement with full back wages would eventually follow but this legal dynamic has gradually changed overtime and now the court is of the view that if the employment of a temporary workman is terminated or retrenched in violation of section 25F of the Industrial Disputes Act, 1947 and if the termination was not justified with specific reasons and was found illegal, a one time monetary compensation is the correct remedy and not reinstatement or regularization with back wages.
The proviso of section 25F of the Industrial Disputes Act, 1947 states that:
No workman employed in any industry who has been in continuous service for not less than one year under an employer shall be retrenched by that employer until—
a) the workman has been given one month’s notice in writing indicating the reasons for retrenchment and the period of notice has expired, or the workman has been paid in lieu of such notice, wages for the period of the notice;
b) the workman has been paid, at the time of retrenchment, compensation which shall be equivalent to fifteen days' average pay [for every completed year of continuous service] or any part thereof in excess of six months; and
c) notice in the prescribed manner is served on the appropriate Government [or such authority as may be specified by the appropriate Government by notification in the Official Gazette].
LEGAL PRECEDENT
The Apex court has observed and time and again and reiterated in many precedents that a grant of one time monetary compensation is the correct rule and not reinstatement with back wages if a daily wager is terminated illegally in violation of section 25F of Industrial Disputes Act, 1947.
The Supreme court in Jagbir Singh v. Haryana State Agriculture Mktg. Board.(2009) 15 SCC 327 laid down that:
“It is true that the earlier view of this Court articulated in many decisions reflected the legal position that if the termination of an employee was found to be illegal, the relief of reinstatement with full back wages would ordinarily follow. However, in recent past, there has been a shift in the legal position and in a long line of cases, this Court has consistently taken the view that relief by way of reinstatement with back wages is not automatic and may be wholly inappropriate in a given fact situation even though the termination of an employee is in contravention of the prescribed procedure. Compensation instead of reinstatement has been held to meet the ends of justice.”
In Incharge Officer v. Shankar Shetty (2010) 9 SCC 126, the Supreme court reiterating Jagbir Singh(Supra) held that:
“the principles stated in Jagbir Singh (supra) and the decisions of this Court referred to therein are kept in mind, it will be found that the High Court erred in granting relief of reinstatement to the respondent. The respondent was engaged as a daily wager in 1978 and his engagement continued for about 7 years intermittently up to 6-9-1985 i.e. about 25 years back. In a case such as the present one, it appears to us that relief of reinstatement cannot be justified and instead monetary compensation would meet the ends of justice. In our considered opinion, the compensation of Rs 1,00,000 (Rupees one lakh) in lieu of reinstatement shall be appropriate, just and equitable. We order accordingly. Such payment shall be made within 6 weeks from today failing which the same shall carry interest at the rate of 9% per annum.”
In Bharat Sanchar Nigam Limited vs Bhurumal (2014) 7 SCC 177,. The Supreme Court opined that: “ It is an ordinary principle of grant of reinstatement with full back wages, when the termination is found to be illegal is not applied mechanically in all cases. While that may be a position where services of a regular/permanent workman are terminated illegally and/or mala fide and/or by way of victimization, unfair labour practice, etc. However, when it comes to the case of termination of a daily-wage worker and where the termination is found illegal because of a procedural defect, namely, in violation of Section 25-F of the Industrial Disputes Act, this Court is consistent in taking the view that in such cases reinstatement with back wages is not automatic and instead the workman should be given monetary compensation which will meet the ends of justice. Rationale for shifting in this direction is obvious.”
The same has been opined in Hindustan Machine Tools Ltd. v. Ghanshyam Sharma (2018) 18 SCC 80, where the Supreme court set aside the labour court’s award that had reinstated the daily wager services with back wages and directed to award a one time compensation.
TEMPORARY EMPLOYMENT DOES NOT DEEM LEGITIMACY OR PERMANENT ENGAGEMENT
If the worker is on a temporary employment and is working on a daily wage basis and the termination thereof is found to be illegal, the worker will not have the right to seek regularization by virtue of his temporary employment. The constitutional bench in State of Karnataka Vs. Uma Devi & Ors (2006) 4 SCC 1 has opined that a temporary workman who has been working for a considerable amount of time cannot presume to be permanently engaged and claim relief accordingly. The five judge bench held that:
“When a person enters a temporary employment or gets engagement as a contractual or casual worker and the engagement is not based on a proper selection as recognized by the relevant rules or procedure, he is aware of the consequences of the appointment being temporary, casual or contractual in nature. Such a person cannot invoke the theory of legitimate expectation for being confirmed in the post when an appointment to the post could be made only by following a proper procedure for selection and in concerned cases, in consultation with the Public Service Commission. Therefore, the theory of legitimate expectation cannot be successfully advanced by temporary, contractual or casual employees. It cannot also be held that the State has held out any promise while engaging these persons either to continue them where they are or to make them permanent. The State cannot constitutionally make such a promise. It is also obvious that the theory cannot be invoked to seek a positive relief of being made permanent in the post.”
Therefore, when the daily wager cannot claim regularization by virtue of the judgement rendered in Uma Devi., he has no right to continue even as a daily-wage worker, no useful purpose is going to be served in reinstating such a workman and he can be given monetary compensation by the Court itself inasmuch as if he is terminated again after reinstatement, he would receive monetary compensation only in the form of retrenchment compensation and notice pay. In such a situation, giving the relief of reinstatement, that too after a long gap, would not serve any purpose.
EXCEPTIONS TO WHEN REINSTATMENT SHOULD BE THE RULE FOR A DAILY WAGE WORKERS.
A daily wager can claim the relief of reinstatement in cases where the termination of a daily wage worker was found to be illegal on the ground that it was resorted to as unfair labour practice or in violation of the principle of last come first go viz. while retrenching such a worker daily wage juniors to him were retained or situation where worker junior to him were regularized
In such circumstances, the terminated worker should not be denied reinstatement unless there are some other weighty reasons for adopting the course of grant of compensation instead of reinstatement.
In these exceptional case the reinstatement should be the rule and only in exceptional cases for the reasons stated to be in writing, such a relief can be denied by a competent authority.
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