Orissa HC Ends 27-Year Legal Battle: SBI Sweepers Awarded ₹20 Lakh Each
Court Rejects Regularisation Plea but Grants Compensation for Three Decades of Service
Judges Balance Labour Rights and Financial Burden, Highlighting Justice in the AI Era
By Our Legal Correspondent
New Delhi: June 28, 2026:
The Orissa High Court has finally closed a 27-year-old legal battle involving two State Bank of India sweepers, awarding them ₹20 lakh each as lump-sum compensation. The ruling underscores the limits of regularisation under labour law while affirming the principle of “complete justice” through monetary relief.
Case Background
Litigants: Mayadhar Nayak and Baina Nayak, daily wage sweepers at SBI Treasury Branch, Bhubaneswar since 1995.
Legal Journey:
1999: First petitions filed seeking regularisation.
2007–2008: Courts directed SBI to pay minimum wages and continue engagement.
2025: Single Judge dismissed plea for regularisation.
2026: Division Bench of Justices Krishna S Dixit and Chittaranjan Dash awarded compensation.
Settlement Attempt: SBI offered ₹5 lakh each; workers demanded ₹25 lakh. Court fixed ₹20 lakh as fair balance.
Key Legal Framework
1. Industrial Disputes Act, 1947
Governs disputes between employers and workers.
Provides remedies like reinstatement, compensation, or regularisation.
Courts often reluctant to order regularisation unless statutory rules permit.
2. Precedents on Regularisation
Supreme Court (Secretary, State of Karnataka v. Umadevi, 2006):
Held that irregular appointments cannot be regularised.
Only workers with long continuous service may be considered for one-time relief.
Application Here: HC cited Umadevi to deny unconditional appointment.
3. Minimum Wages Act, 1948
Earlier orders ensured SBI paid minimum wages.
Protects workers from exploitation despite lack of permanent status.
4. Constitutional Principles
Article 14 (Equality): Workers cannot be arbitrarily denied fair treatment.
Article 21 (Right to Livelihood): Compensation ensures dignity despite lack of regularisation.
Court’s Reasoning
Workers rendered 30 years of spotless service.
Regularisation would impose greater financial burden on SBI.
Lump sum compensation balances justice and practicality.
Judges noted workers’ age, limited education, and poor prospects in the “AI era.”
Analytical Insights
Significance of the Ruling
Labour Rights: Recognises contribution of daily wage workers.
Judicial Pragmatism: Compensation instead of regularisation avoids precedent that could burden institutions.
Social Justice: Court acknowledged “bread is costlier than blood,” emphasising humane approach.
Challenges Highlighted
Systemic Delay: 27 years of litigation shows inefficiency.
Policy Gap: Lack of statutory clarity on long-term daily wagers.
Future Implications: May encourage negotiated settlements in similar cases.
FAQ: Legal Points Simplified
Q1: Why were the sweepers not regularised?
A: Supreme Court precedent (Umadevi, 2006) bars regularisation of irregular appointments.
Q2: What relief did the High Court grant?
A: Lump sum compensation of ₹20 lakh each, payable within eight weeks.
Q3: Which laws were relevant?
A: Industrial Disputes Act, Minimum Wages Act, and constitutional principles of equality and dignity.
Q4: What earlier orders had granted?
A: Minimum wages and continued engagement, but not permanent status.
Q5: Can other daily wage workers claim similar relief?
A: Yes, but courts assess case-specific factors like duration of service and prior litigation.
Q6: Why did the court reject SBI’s offer of ₹5 lakh?
A: Judges found it “too frugal” given three decades of service.
Q7: Does this set a precedent for compensation?
A: Yes, it signals courts may prefer monetary relief over regularisation.
Q8: What happens if SBI delays payment?
A: Workers can initiate contempt proceedings against the bank.
Conclusion
The Orissa High Court’s ruling is a landmark in labour jurisprudence, balancing strict legal precedents with humane justice. By awarding compensation instead of regularisation, the court respected the Umadevi precedent while ensuring dignity for workers who gave decades of service. The judgment highlights the need for policy reforms to address the plight of daily wage employees, ensuring they are not left in limbo for decades.