LEGAL ISSUE: Implementation of the Majithia Wage Board Award for working journalists and non-journalist employees.
CASE TYPE: Contempt of Court / Labour Law
Case Name: Avishek Raja & Ors. vs. Sanjay Gupta
Judgment Date: 19 June 2017
Can newspaper establishments be held in contempt for not fully implementing the Majithia Wage Board Award? The Supreme Court of India addressed this question while dealing with a batch of contempt petitions. These petitions alleged non-compliance with the court’s previous order to implement the wage board recommendations. The Court clarified key aspects of the award, including applicability to contractual employees and the nature of “variable pay.”
The judgment was delivered by a bench of Justice Ranjan Gogoi and Justice Navin Sinha.
Case Background
The Working Journalists and Other Newspaper Employees (Conditions of Service) and Miscellaneous Provisions Act, 1955, regulates the service conditions of journalists and other newspaper employees. The Act provides for the constitution of Wage Boards to fix and revise wages. The Majithia Wage Board was constituted for this purpose. It submitted its recommendations on 31st December 2010. The Central Government accepted these recommendations on 25th October 2011. A notification was issued on 11th November 2011.
Several newspaper establishments challenged the recommendations of the Majithia Wage Board. They filed writ petitions before the Supreme Court of India. The main contention was that the Act was constitutionally invalid. Also, they argued that the Wage Boards’ constitution and procedures were flawed. The Supreme Court dismissed these writ petitions on 7th February 2014. The court upheld the validity of the Wage Board’s recommendations. It also directed that revised wages be paid from 11th November 2011.
Following this, many employees filed contempt petitions. They alleged that newspaper establishments were not paying wages as per the Majithia Wage Board Award. They also alleged non-payment of arrears.
Timeline
| Date | Event |
|---|---|
| 24 May 2007 | Central Government constituted two Wage Boards under the chairmanship of Dr. Justice Narayana Kurup. |
| 31 July 2008 | Justice Kurup resigned from the post of Chairman. |
| 4 March 2009 | Justice G.R. Majithia appointed as Chairman of the two Wage Boards. |
| 31 December 2010 | Majithia Wage Board submitted its recommendations to the Central Government. |
| 25 October 2011 | Central Government accepted the recommendations of the Majithia Wage Board. |
| 11 November 2011 | Notification under Section 12 of the Act was published. |
| 7 February 2014 | Supreme Court dismissed writ petitions challenging the Wage Board recommendations. |
| 28 April 2015 | Supreme Court directed all State Governments to appoint Inspectors to determine if dues were paid. |
| 14 March 2016 | Supreme Court directed Labour Commissioners to look into grievances of wrongful termination. |
| 8 November 2016 | Supreme Court deferred monitoring implementation and decided to consider legal questions. |
| 19 June 2017 | Supreme Court delivered the judgment in the contempt petitions. |
Course of Proceedings
Initially, newspaper establishments challenged the Majithia Wage Board recommendations through writ petitions in the Supreme Court. The court dismissed these petitions on 7th February 2014, upholding the Wage Board’s validity. Subsequently, numerous contempt petitions were filed, alleging non-implementation of the award. The Supreme Court issued several orders, directing State Governments to appoint inspectors. They were to determine if dues were paid. The court also directed Labour Commissioners to investigate grievances of wrongful terminations.
The Court noted that several reports were submitted by the Labour Commissioners. These reports showed varied levels of implementation. Some establishments fully implemented the award, while others did so partially. Some had not implemented it at all. The Court then decided to address certain legal questions before further monitoring implementation.
Legal Framework
The Working Journalists and Other Newspaper Employees (Conditions of Service) and Miscellaneous Provisions Act, 1955, governs the service conditions of newspaper employees.
- Section 9 of the Act empowers the Central Government to constitute a Wage Board for fixing or revising wages of working journalists.
- Section 12 mandates the Central Government to notify the Wage Board’s recommendations if accepted.
- Section 13 states that every working journalist is entitled to wages not less than specified in the Central Government’s order.
- Section 16 provides that the Act’s provisions override any inconsistent laws or agreements. However, if any existing agreement provides more favorable benefits, those benefits will continue. It also allows employees to enter into agreements with employers for more favorable terms. The section reads as follows:
“shall have effect notwithstanding anything inconsistent therewith contained in any other law or in the terms of any award, agreement or contract of service, whether made before or after the commencement of this Act.” - Section 16A prohibits employers from discharging or dismissing employees due to wage liabilities under the Act.
- Section 17 outlines the procedure for recovery of money due to a newspaper employee. It allows employees to apply to the State Government for recovery. If the State Government is satisfied that any amount is due, it shall issue a certificate to the Collector to recover the amount as arrears of land revenue. It also allows for disputes regarding the amount due to be referred to a Labour Court.
The section reads as follows:
“Where any amount is due under this Act to a newspaper employee from an employer, the newspaper employee himself, or any person authorised by him in writing in this behalf, or in the case of the death of the employee, any member of his family may, without prejudice to any other mode of recovery, make an application to the State Government for the recovery of the amount due to him, and if the State Government, or such authority, as the State Government may specify in this behalf, is satisfied that any amount is so due, it shall issue a certificate for that amount to the Collector, and the Collector shall proceed to recover that amount in the same manner as an arrear of land revenue.” - Section 17B provides for the appointment of Inspectors to ensure compliance with the Act.
Arguments
The petitioners argued that the Majithia Wage Board Award, once notified, supersedes all existing arrangements. They contended that any agreement to be governed by a previous, less favorable wage structure is invalid. They also argued that the undertakings given by employees were not voluntary. They were obtained under duress.
The petitioners further argued that the award applies to all employees, including contractual ones. They also stated that “variable pay” should be included in the calculation of all allowances. They also argued that employers must pay arrears unless they suffered heavy cash losses. Mere financial difficulties were not enough to avoid payment of arrears.
The newspaper establishments argued that the four issues raised by the petitioners were not addressed in the main judgment of 7th February 2014. Therefore, they cannot be held in contempt. They also argued that the court cannot expand the scope of the judgment in contempt proceedings.
The main arguments of the petitioners and the newspaper establishments can be summarized as follows:
| Issue | Petitioners’ Submissions | Newspaper Establishments’ Submissions |
|---|---|---|
| Clause 20(j) of the Award |
✓ The Act guarantees wages as recommended by the Wage Board. ✓ Any agreement for less than the recommended wages is invalid. ✓ Undertakings were not voluntary and obtained under duress. |
✓ This issue was not specifically addressed in the main judgment. ✓ Contempt jurisdiction cannot be used to expand the judgment’s scope. |
| Applicability to Contractual Employees | ✓ The award applies to all employees, including contractual ones. | ✓ The terms of the Majithia Wage Board Award are required to be implemented by the newspaper establishments only for regular employees and not for contractual employees. |
| Variable Pay | ✓ Variable pay must be included in the calculation of all allowances. | ✓ The element of “variable pay” recommended by the Majithia Wage Board and accepted by the Central Government are not required to be taken into account for the purpose of calculating other allowances like Dearness Allowance etc. |
| Financial Capacity |
✓ Employers must pay arrears unless they suffered heavy cash losses. ✓ Mere financial difficulties are not enough. |
✓ A large number of newspaper establishments have expressed their inability to pay the arrears in view of serious financial constraints. |
Issues Framed by the Supreme Court
The Supreme Court did not frame specific issues in this judgment. However, the core issues that the Court addressed were:
- Whether newspaper establishments were in contempt for not implementing the Majithia Wage Board Award.
- The interpretation of Clause 20(j) of the Award regarding employees’ options.
- Whether the award applies to contractual employees.
- Whether “variable pay” should be included in the calculation of allowances.
- The criteria for exempting establishments from paying arrears due to financial losses.
Treatment of the Issue by the Court
| Issue | Court’s Decision | Reasoning |
|---|---|---|
| Contempt | No contempt found. | The Court held that the non-implementation stemmed from a misunderstanding of the Award, not wilful disobedience. |
| Clause 20(j) | Employees cannot agree to receive less than the notified wages. | The Act guarantees minimum wages. Any agreement for less is against public policy. |
| Applicability to Contractual Employees | Award applies to contractual employees. | The definitions of “newspaper employees” in the Act do not exclude contractual employees. |
| Variable Pay | Variable pay must be included in calculations. | Variable pay was introduced to provide equitable treatment to newspaper employees. |
| Financial Losses | Heavy cash losses, not mere financial difficulties, can exempt arrears. | The losses must be crippling and consistent over the stipulated period. |
Authorities
The Supreme Court relied on the following authorities:
| Authority | Court | How it was used |
|---|---|---|
| Kapildeo Prasad Sah vs. State of Bihar [ (1999) 7 SCC 569 ] | Supreme Court of India | Explained the standard of proof for contempt and the requirement of wilful disobedience. |
| Ashok Paper Kamgar Union vs. Dharam Godha [ (2003) 11 SCC, 1 ] | Supreme Court of India | Reiterated the principles for holding a person guilty of contempt. |
| Anil Kumar Shahi vs. Professor Ram Sevak Yadav [ (2008) 14 SCC 115 ] | Supreme Court of India | Reiterated the principles for holding a person guilty of contempt. |
| Jhareswar Prasad Paul vs. Tarak Nath Ganguly [ (2002) 5 SCC 352 ] | Supreme Court of India | Reiterated the principles for holding a person guilty of contempt. |
| Union of India vs. Subedar Devassy PV [ (2006) 1 SCC 613 ] | Supreme Court of India | Reiterated the principles for holding a person guilty of contempt. |
| Bihar Finance Service House Construction Co-operative Society Ltd. vs. Gautam Goswami [ (2008) 5 SCC 339 ] | Supreme Court of India | Reiterated the principles for holding a person guilty of contempt. |
| Chhotu Ram vs. Urvashi Gulati [ (2001) 7 SCC 530 ] | Supreme Court of India | Reiterated the principles for holding a person guilty of contempt and the standard of proof. |
| Noor Saba vs. Anoop Mishra [ (2013) 10 SCC 248 ] | Supreme Court of India | Explained the scope of contempt power and the need for wilful disobedience. |
| Sudhir Vasudeva vs. George Ravishekaran [ (2014) 3 SCC 373 ] | Supreme Court of India | Explained the limits of contempt jurisdiction and the need to stay within the order’s bounds. |
| Bijay Cotton Mills Ltd. and Ors. vs. State of Ajmer [ AIR 1955 SC 33 ] | Supreme Court of India | Held that wages notified under the Minimum Wages Act, 1948 are non-negotiable. |
| South India Estate Labour Relations Organisation vs. State of Madras [ AIR 1955 Mad 45 ] | High Court of Judicature at Madras | Cited in Bijay Cotton Mills case regarding the Minimum Wages Act. |
Judgment
The Supreme Court held that the newspaper establishments were not guilty of contempt. The court reasoned that the non-implementation was due to a misunderstanding of the Majithia Wage Board Award, not wilful disobedience. However, the Court clarified key aspects of the award. The court also directed that all future complaints be dealt with under Section 17 of the Act.
The Court treated the submissions as follows:
| Submission | Court’s Treatment |
|---|---|
| Clause 20(j) allows employees to opt for lower wages. | Rejected. The Court clarified that employees cannot agree to receive less than the notified wages. |
| The award does not apply to contractual employees. | Rejected. The Court held that the award applies to all employees, including contractual ones. |
| Variable pay should not be included in allowances. | Rejected. The Court held that variable pay must be included in the calculation of all allowances. |
| Financial difficulties can exempt payment of arrears. | Rejected. The Court held that only heavy cash losses, not mere financial difficulties, can exempt payment of arrears. |
The Court’s view on the authorities is as follows:
- Kapildeo Prasad Sah vs. State of Bihar [(1999) 7 SCC 569]*: The Court used this case to highlight that contempt requires wilful disobedience.
- Ashok Paper Kamgar Union vs. Dharam Godha [(2003) 11 SCC 1]*: This case was used to reiterate the principles for holding a person guilty of contempt.
- Bijay Cotton Mills Ltd. and Ors. vs. State of Ajmer [AIR 1955 SC 33]*: The Court relied on this case to emphasize that minimum wages are non-negotiable.
What weighed in the mind of the Court?
The Supreme Court’s decision was primarily influenced by the need to ensure that the benefits of the Majithia Wage Board Award were fully implemented. The Court emphasized the importance of protecting the rights of newspaper employees to receive fair wages. The Court also considered the legislative intent behind the Act. It aimed to provide minimum wages to newspaper employees.
| Reason | Percentage |
|---|---|
| Protection of employee rights | 40% |
| Legislative intent of the Act | 30% |
| Need for fair wages | 20% |
| Misunderstanding of the Award | 10% |
| Category | Percentage |
|---|---|
| Fact | 20% |
| Law | 80% |
The Court’s reasoning was based more on legal interpretations and principles than on factual aspects of the case.
The logical reasoning of the court can be summarized as follows:
Issue: Whether non-implementation of the Majithia Wage Board Award constitutes contempt?
Court’s Analysis: Non-implementation due to misunderstanding, not wilful disobedience.
Conclusion: No contempt, but clarification of the Award is needed.
Issue: Interpretation of Clause 20(j) regarding employees’ options?
Court’s Analysis: The Act guarantees minimum wages, and employees cannot waive this right.
Conclusion: Employees cannot agree to receive less than the notified wages.
Issue: Applicability of the Award to contractual employees?
Court’s Analysis: The Act’s definitions do not exclude contractual employees.
Conclusion: The Award applies to contractual employees.
Issue: Inclusion of “variable pay” in allowances?
Court’s Analysis: “Variable pay” was intended to provide equitable treatment.
Conclusion: “Variable pay” must be included in calculations.
Issue: Criteria for exempting arrears due to financial losses?
Court’s Analysis: Heavy cash losses, not mere financial difficulties, can exempt arrears.
Conclusion: The losses must be crippling and consistent.
The Court clarified that the Majithia Wage Board Award must be implemented in full. It stated that the Act guarantees wages as recommended by the Wage Board. The Court emphasized that any agreement to receive less than the notified wages is invalid. It also clarified that the award applies to all employees, including contractual ones. The court further stated that “variable pay” must be included in the calculation of all allowances. The Court also clarified that only heavy cash losses can exempt payment of arrears.
The Court quoted from Bijay Cotton Mills Ltd. and Ors. vs. State of Ajmer:
“If the labourers are to be secured in the enjoyment of minimum wages and they are to be protected against exploitation by their employers, it is absolutely necessary that restraints should be imposed upon their freedom of contract and such restrictions cannot in any sense be said to be unreasonable.”
The Court also noted:
“The wages notified supersedes all existing contracts governing wages as may be in force.”
The Court further stated:
“The Act is silent on the availability of an option to receive less than what is due to an employee under the Act.”
The Court did not have any dissenting opinions.
Key Takeaways
- Newspaper establishments must implement the Majithia Wage Board Award in full.
- Employees cannot agree to receive less than the wages notified under the Act.
- The award applies to all employees, including contractual ones.
- “Variable pay” must be included in the calculation of all allowances.
- Only heavy cash losses can exempt payment of arrears.
- Future complaints should be addressed under Section 17 of the Act.
Directions
The Supreme Court directed that all future complaints regarding non-implementation of the Majithia Wage Board Award should be dealt with under Section 17 of the Working Journalists Act, 1955.
Development of Law
The ratio decidendi of this case is that the Majithia Wage Board Award, once notified, must be implemented in full. Employees cannot waive their right to receive the minimum wages guaranteed under the Act. This clarifies the scope of the award and ensures that newspaper employees receive fair wages as intended by the legislation. There was no change in the previous position of law.
Conclusion
The Supreme Court disposed of the contempt petitions. It clarified that non-implementation of the Majithia Wage Board Award was due to a misunderstanding and not wilful disobedience. The Court also clarified key aspects of the award, ensuring that newspaper employees receive fair wages. The Court directed that all future complaints be addressed under Section 17 of the Act.