State of Chhattisgarh vs Presiding Officer, Labour Court and Others

Manindra Mohan Shrivastava, J.—By this petitioner, the petitioner has called in question the legality and validity of order dated 30-11-2004 (Annexure P-1), by which, the Labour Court has directed reinstatement of the employees/respondents No. 2 to 41. Relevant facts necessary for decision of the case are that the respondents No. 2 to 41 were employed on daily wage basis by the petitioner to work in its office. While the respondents/employees were continuing, their services were terminated with effect from 1-7-1988. On industrial dispute being raised by the retrenched employees, reference was made to the Labour Court. Vide order dated 21-6-1991 passed in Case No. 12/89/I.D. (Reference) Act, the Labour Court passed an order of reinstatement with 50% backwages. The petitioner challenged this order as also by the respondent employees through their Union by filing their respective petitions before the High Court of Madhya Pradesh at Jabalpur. Both writ petitions were dismissed by the High Court vide its order dated 6-10-1994 (Annexure P-3). Against the said order, SLP was preferred by the State, which too was dismissed on 28-2-1995 (Annexure P-4).

In compliance of the award passed by the Labour Court, the petitioner reinstated the respondent employees on 4-2-1993.

The State took a policy decision vide its circular dated 27-1-2000 (Annexure P-5) to terminate daily wage employees, who were appointed after 31-12-1988. The State issued circular on 24-7-2000 (Annexure P-7) clarifying as to who would be treated as working on 31-12-1988. The petitioner treated respondent employees as having been employed on daily wage basis after 31-12-1988 and their services were terminated, after giving a month''s notice along with the retrenchment compensation and gratuity. This action of the petitioner was again challenged giving rise to a dispute and on dispute being referred to the Labour Court, the impugned award was passed on 30-11-2004 (Annexure P-l) directing reinstatement of respondent employees though without backwages. It is this award, which is under challenge in this writ petition.

Learned counsel for the petitioner contended that the respondent employees were re-appointed on 4-2-1993, though in compliance of the order of reinstatement by the Labour Court. For all legal and practical purposes, the respondent employees could only be treated as daily wage employees appointed on 4-2-1993. According to him, employees were earlier retrenched from service with effect from 1-7-1988, therefore, from 1-7-1988 till 4-2-1993, they were not working as daily wage employees. Therefore, in view of the State Government''s policy decision dated 27-1-2000 (Annexure P-5) clarified by circular dated 24-7-2000 (Annexure P-7), they were not working as daily wage employees as on 31-12-1988, therefore, the petitioner is fully justified in retrenching their services. He further submits that all the respondent employees were not only given a month''s notice, but also paid retrenchment compensation and gratuity. Learned counsel for the petitioner submitted that there is no illegality in termination of respondent employees, but the Labour Court wrongly treated as having been appointed and working as daily wage employees, since their initial engagement as daily wage employee in the year 1986. Therefore, the award of reinstatement is in excess of jurisdiction and deserves to be set aside.

Per contra, learned counsel for the respondent employees that the effect of order of reinstatement by the Labour Court vide its award dated 21-6-1991, which was confirmed up to the Supreme Court, would be that the employees would be deemed to be in service without any interruption, therefore, they were rightly treated in employment as on 31-12-1988 and there is no illegality in the award. He further submits that the employees have been reinstated pursuant to the impugned award and they are working.

From the action of the petitioner and the stand taken by them before the Labour Court as well as before this Court, it is revealed that all the daily wage employees have been treated to be appointed as daily wage employees as on 4-2-1993 and on that basis, government''s policy decision dated 27-01-2000 (Annexure P-5) & 24-07-2000 (Annexure P-7) have been applied in their case and their services have been terminated.

The employees, undeniably, were working as daily wage employees till they were terminated on 1-7-1988. However, that order of termination was declared illegal and the Labour Court passed an award of reinstatement with 50% backwages on 21-6-1991 in Reference Case No. 12/89/I.D. (Reference) Act. Order of reinstatement was challenged by the petitioner before the High Court of Madhya Pradesh and the writ petition was dismissed. SLP against the said order was also dismissed by the Supreme Court. Thus, the order of reinstatement by the Labour Court attained finality.

The legal consequences flowing from order of reinstatement was that the employees would be treated as having continued in service without any break. Therefore, the entire period, during which, the employees remained out of employment due to illegal order of termination i.e. 1-7-1988 to 4-2-1993 will have to be treated as period of daily wage employment under the order of reinstatement. It is this legal fiction, which applies in the case of employees, even if they actually did not work during this period. This legal consequence would mean that all the employees, who have been reinstated, are deemed to have continued in service, which would naturally include 31-12-1988 also. It is relevant to note that in respect of the period, during which, the employees have remained out of employment, 50% backwages was also awarded, therefore, it cannot be said that on 31-12-1988, they were not daily wage employees. If that is done, that would negate and nullify the legal effect of a judicial order of reinstatement under an award of Labour Court.

The Labour Court has correctly applied the principles with regard to legal consequences flowing from the order of reinstatement by holding that the respondent employees shall be deemed to be in service, and therefore, their services could not be terminated on the basis of policy decision to terminate daily wage employees appointed after 31-12-1988. It has also been informed to this Court and in fact, recorded in order dated 17-8-2005 passed by this Court that all the respondent employees have been reinstated in service. In the result, I do not find any merit in this petition, which is accordingly dismissed. No orders as to cost.