Whether the Regularization of workmen comes within the judicial domain of Labour Court/ Industrial Court? : SC refers it to a larger bench

Approach of Art.136 Cannot Be Adopted While Deciding Petitions by The High Court Under Art.227: SC

In this appeal there arises a question of law as to determination of the scope of powers conferred upon the Labour Court and Industrial Court in context of regularisation of posts of workmen in the absence of sanctioned post in furtherance of which SC after observing the decision of Oil and Natural Gas Corporation Limited v Petroleum Coal Labour Union felt the need of its reconsideration and forwarded it into the hands of larger bench.

Case – Oil and Natural Gas Corporation v/s Krishan Gopal & ors.

Case no.- Civil Appeal No. 1878 of 2016

Reffered to larger bench of SC by-Dr Dhananjaya Y Chandrachud, J. 

Brief facts

In these batch of appeals , a judgment of a two judge Bench of this Court in Oil and Natural Gas Corporation Limited v Petroleum Coal Labour Union (“PCLU”) has assumed focus since the decisions of the High Courts in four of the present appeals have relied on the judgment of this Court in coming to the conclusion that the workmen were entitled to regularisation in service whereas in the remaining fifth appeal the decision of PUCL remains distinguished as the High Court rejected the prayer for regularisation made by the workmen who had instituted proceedings under Article 226 on the ground that they had initiated proceedings under Article 226 without availing of the remedy under the ID Act and therefore held that the remedy under the Industrial Disputes Act 1947 could not be bypassed. Hence ONGC was in appeal against an award of the Industrial Tribunal directing it to regularise the services of security guards and supervisors with effect from the date on which they had completed 480 days to which the Industrial Tribunal made an award directing ONGC to regularise the services of the workmen which was challenged by ONGC before the High Court in writ proceedings on the ground that the workmen had been originally selected without following any selection procedure, in violation of the decision in Secretary, State of Karnataka v/s Umadevi. This writ petition and further a writ appeal was dismissed by the HC and presented before SC to challenge the judgment of the High Court.

Issues

  • Whether the decision of the two judge Bench of this Court in PCLU is per incuriam on the ground that it did not consider the binding precedents on the interpretation of Item 10 of Schedule V of the ID Act?
  • Whether the interpretation which has been placed in PCLU on clause 2(ii) of the Certified Standing Orders for contingent employees of ONGC to the effect that a temporary workman who has put in 240 days of attendance in any period of twelve consecutive months and possesses the minimum qualifications is entitled to regularisation appropriate?
  • Applicability of the principles enunciated in the judgment of the Constitution Bench in Secretary, State of Karnataka v Umadevi.
  • Ingredients of an unfair labour practice under Item 10 of Schedule V of the ID Act.
  • Whether a finding of an unfair labour practice can be rendered in a proceeding under Article 226 of the Constitution without the workmen leading evidence in a reference under the ID Act.
  • Whether jurisdiction of the Tribunal to direct the Corporation to regularise the services of the workmen concerned in the posts is valid and legal?

Key features

Clause 2 of the Certified Standing Orders provides thus :

 (i) Classification of workmen- The contingent employees of the Commission shall hereafter be classified as:

(a) Temporary, and

(b) Casual

(ii) A workman who has been on the rolls of the Commission and has put in not less than 180 days of attendance in any period of 12 consecutive months shall be a temporary workman, provided that a temporary workman who has put in not less than 240 days of attendance in any period of 12 consecutive months and who possesses the minimum qualifications prescribed by Commission may be considered for conversion as regular employee.

(iii) A workman who is neither temporary nor regular shall be considered as casual workman.

  • Clause 2 of the Certified Standing Orders provides upon the completion of 240 days of service in a calendar year, the workmen have “acquired valid statutory right” and ought to have been “granted the status of regular employees” of the corporation on the ground that the corporation which is an instrumentality of the State under Article 12 cannot act arbitrarily or unreasonably.
  • The management could not deny the rights of the workmen by contending that their initial employment was contrary to Articles 14 and 16 of the Constitution.[i]

Judgment

After analysing the judicial precedents of Oil and Natural Gas Corporation Limited v Engineering Mazdoor Sangh[ii];Mahatma Phule Agricultural University v Nasik Zilla Sheth Kamgar Union[iii],;Regional Manager, State Bank of India v Raja Ram[iv];Regional Manager, SBI v Rakesh Kumar tewari[v] and Secretary, State of Karnataka v Umadevi[vi] the following proposition emerged-

(i) The powers of the Labour Court and the Industrial Court cannot extend to a direction to order regularisation, where such a direction would in the context of public employment offend the provisions contained in Article 14 of the Constitution;

(ii) The statutory power of the Labour Court or Industrial Court to grant  relief to workmen including the status of permanency continues to exist in circumstances where the employer has indulged in an unfair labour practice by not filling up permanent posts even though such posts are available and by continuing to employ workmen as temporary or daily wage employees despite their performing the same work as regular workmen on lower wages;

(iii) The power to create permanent or sanctioned posts lies outside the judicial domain and where no posts are available, a direction to grant regularisation would be impermissible merely on the basis of the number of years of service;

(iv) Where an employer has regularised similarly situated workmen either in a scheme or otherwise, it would be open to workmen who have been deprived of the same benefit at par with the workmen who have been regularised to make a complaint before the Labour or Industrial Court, since the deprivation of the benefit would amount to a violation ofArticle 14; and

(v) In order to constitute an unfair labour practice under Section 2(ra) read with Item 10 of the Vth Schedule of the ID Act, the employer should be engaging workmen as badlis, temporaries or casuals, and continuing them for years, with the object of depriving them of the benefits payable to permanent workmen.

Further the court ordered for revision of PCLU specifying the key areas of reconsideration as:

  • The interpretation placed on the provisions of clause 2(ii) of the Certified Standing Orders;
  • The meaning and content of an unfair labour practice under Section 2(ra) read with Item 10 of the Vth Schedule of the ID Act
  • The limitations, if any, on the power of the Labour and Industrial Courts to order regularisation in the absence of sanctioned posts.

Edited by Pragash Boopal

Approved & Published – Sakshi Raje

Reference

[i] Ajaypal Singh v Haryana Warehousing Corporation

[ii] (2007) 1 SCC 250

[iii] (2001) 7 SCC 346

[iv] (2004) 8 SCC 164

[v] (2006) 1 SCC 530

[vi] (2006) 4 SCC 1

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I am Shraddha a third year undergraduate student at S.R.M. University, Delhi NCR persuing B.A.LL.B (Hons.). As someone who is interested in research work, I am more into reading and exploring the unexplored part and law being an endless ocean of knowledge attracts me the most specially certain legal fields such as criminal law, family law, human rights laws, international law interests me the most. Being a passionate reader, I enjoy reading philosophical and motivational books and also autobiographies at times (comics and fairy tales as well). Apart from this Mandela art and travelling are also one of my hobbies.