Supreme Court clarifies re-employment of retrenched workers in U.P. Jal Nigam: Badri Vishal Pandey vs. Rajesh Mittal (2019)

Introduction

Date of the Judgment: 4th January 2019
Citation: Not Available
Judges: A.M. Khanwilkar, J. and Hemant Gupta, J.
Can a court order that disposes of a case based on a concession by one party be interpreted as a direction for automatic reinstatement of retrenched workers? This was the core question before the Supreme Court in this contempt case. The court had to determine if the U.P. Jal Nigam had violated its previous order by not reinstating certain daily wage workers. The bench consisted of Justice A.M. Khanwilkar and Justice Hemant Gupta, with Justice Hemant Gupta authoring the judgment.

Case Background

The U.P. Jal Nigam Construction Division (Jal Nigam) had engaged workers as Runners, Beldars, and Lab Assistants before 1991. In 1991, the services of those appointed after March 31, 1989, were terminated under Section 6N of the U.P. Industrial Disputes Act, 1947. This action led to a series of legal challenges.

A writ petition challenging the termination was decided on November 5, 2009, where the High Court upheld the cut-off date for retrenchment but directed the Jal Nigam to give preference to the retrenched workers in future appointments. Subsequently, a Labour Court awarded compensation to one of the workers, which was then challenged in the High Court. The High Court ordered reinstatement without back wages, relying on previous similar orders.

The Jal Nigam then filed Special Leave Petitions before the Supreme Court against these orders. These petitions were disposed of on September 7, 2015, based on an office order dated April 7, 2015, where the Jal Nigam agreed to give preference to retrenched workers in future daily wage/muster roll vacancies. The present contempt petitions arose from the alleged non-compliance of this Supreme Court order.

Timeline:

Course of Proceedings

The initial termination of workers led to a writ petition in the High Court, which upheld the cut-off date for retrenchment but directed the Jal Nigam to give preference to the retrenched workers in future appointments. Subsequently, a Labour Court awarded compensation to one of the workers, which was challenged in the High Court. The High Court ordered reinstatement without back wages, relying on previous similar orders.

The Jal Nigam then filed Special Leave Petitions before the Supreme Court against these orders. These petitions were disposed of on September 7, 2015, based on an office order dated April 7, 2015, where the Jal Nigam agreed to give preference to retrenched workers in future daily wage/muster roll vacancies. The present contempt petitions arose from the alleged non-compliance of this Supreme Court order.

Legal Framework

The core legal provision relevant to this case is Section 6Q of the U.P. Industrial Disputes Act, 1947. This section mandates that when an employer proposes to employ new persons after retrenching workers, the retrenched workers must be given an opportunity for re-employment and they should be given preference over others.

Section 6Q of the U.P. Industrial Disputes Act, 1947 states:

“6Q. Re-employment of retrenched workmen.—Where any workmen are retrenched, and the employer proposes to employ other persons, he shall, in such manner as may be prescribed, give an opportunity to the retrenched workmen who are citizens of India to offer themselves for re-employment, and such retrenched workmen who offer themselves for re-employment shall have preference over other persons.”

This provision aims to protect the interests of retrenched workers by ensuring they are given priority when new employment opportunities arise.

Arguments

Petitioners’ Arguments:

• The petitioners argued that the Jal Nigam had given the impression that it would comply with the High Court’s orders for reinstatement without back wages, based on the office order dated 07.04.2015.
• They contended that the list of retrenched employees, prepared by the Jal Nigam, was not known to them, and therefore, they had not given up their claim for reinstatement.
• The petitioners argued that the Supreme Court’s order of 07.09.2015 was understood by them to mean reinstatement as daily wagers/muster roll employees without back wages.
• They relied on a communication dated 15.04.2017 to contend that 550 vacant Group D posts were available, and they should be reinstated and regularized against these posts.
• They cited cases like State of Punjab v. Surjit Singh [(2009) 9 SCC 514], State of Punjab & Others v. Jagjit Singh & Others [(2017) 1 SCC 148], and Sabha Shanker Dube v. Divisional Forest Officer & Others [2018 (14) SCALE 765] to support their claim for reinstatement at the minimum pay scale applicable to regular employees.
• The petitioners argued that the circular dated 07.04.2015 had prejudiced their claim for reinstatement.

Respondents’ (Jal Nigam) Arguments:

• The Jal Nigam asserted that the circular dated 07.04.2015 was issued in compliance with the High Court’s directions in Writ Petition No. 5686 of 1991.
• They stated that the circular provided for giving preference to retrenched muster roll employees as per the list of 1003 workers, in future vacancies.
• The Jal Nigam argued that there was no undertaking or direction to re-engage the retrenched daily wagers, and the earlier contempt petitions had been dropped.
• They contended that there were no vacancies for daily wages since the order dated 07.04.2015 and that there was no wilful disobedience of the court’s order.
• The Jal Nigam clarified that the 550 Group D posts were not for daily wagers/muster rolls, and they had not made any appointments to Group D posts due to financial constraints.
• They stated that due to the implementation of the 6th Pay Commission, non-technical work was to be outsourced, and they had not outsourced any such work since 2010.
• They also stated that the Jal Nigam’s work model had changed to executing projects through contractors, eliminating the need for daily wage laborers.

Submissions Table

Issues Framed by the Supreme Court

The Supreme Court did not explicitly frame issues in a separate section. However, the core issue before the court was whether the Jal Nigam had committed contempt of court by not reinstating the retrenched workers, despite the order dated 07.09.2015. The court also examined the following sub-issues:

• Whether the order dated 07.09.2015 was a direction for reinstatement.
• Whether the circular dated 07.04.2015 was in compliance with Section 6Q of the U.P. Industrial Disputes Act, 1947.
• Whether the petitioners could claim a right to regular appointment against Group D posts.
• Whether the principle of equal pay for equal work applied to daily wagers engaged on muster rolls.

Treatment of the Issue by the Court

Authorities

Cases Relied Upon by the Court:

• A.Manjula Bhashini and others Vs. The M.D., A.P. Women Coop. Finance Corp. Ltd. [JT 2009 (9) SC 229] – The Supreme Court of India. This case was cited in the High Court’s order of 5.11.2009, stating that fixing a cut-off date is not arbitrary unless it lacks jurisdiction or violates statutory or constitutional provisions.
• State of Punjab v. Surjit Singh [(2009) 9 SCC 514] – The Supreme Court of India. The court noted that this case dealt with the applicability of the doctrine of “equal pay for equal work” and was not relevant to the present case, which concerned re-engagement of retrenched workers.
• State of Punjab & Others v. Jagjit Singh & Others [(2017) 1 SCC 148] – The Supreme Court of India. The court clarified that this case was about temporarily engaged employees’ entitlement to the minimum of regular pay scales and was not applicable to the present case of re-instatement of retrenched workmen.
• Sabha Shanker Dube v. Divisional Forest Officer & Others [2018 (14) SCALE 765] – The Supreme Court of India. The court stated that this case concerned the regularization of daily-rated workers and was not relevant to the present case.
• RBI v. S. Mani, [(2005) 5 SCC 100] – The Supreme Court of India. The court cited this case to emphasize that 240 days of continuous service does not automatically grant a right to claim permanence.

Legal Provisions Considered by the Court:

• Section 6N of the U.P. Industrial Disputes Act, 1947 – This section deals with the conditions precedent to retrenchment of workmen. The court noted that the initial retrenchment of workers was done in terms of this provision.
• Section 6Q of the U.P. Industrial Disputes Act, 1947 – This section mandates that retrenched workmen be given preference for re-employment when the employer proposes to employ other persons. The court held that the circular dated 07.04.2015 was in compliance with this section.
• Section 25F of the Industrial Disputes Act – The court mentioned that this section provides for compensation if a workman is retrenched in violation of the conditions mentioned therein.

Authority Treatment Table

Judgment

How each submission made by the Parties was treated by the Court?

How each authority was viewed by the Court?

• The court distinguished State of Punjab v. Surjit Singh [(2009) 9 SCC 514]*, stating that it pertained to “equal pay for equal work” and was not relevant to the present case of re-engagement of retrenched workers.
• Similarly, State of Punjab & Others v. Jagjit Singh & Others [(2017) 1 SCC 148]* was distinguished as it dealt with the entitlement of temporarily engaged employees to minimum pay scales, which was not the issue in the present case.
• Sabha Shanker Dube v. Divisional Forest Officer & Others [2018 (14) SCALE 765]* was also distinguished as it concerned the regularization of daily-rated workers, which was not the issue here.
• The court followed RBI v. S. Mani, [(2005) 5 SCC 100]*, to emphasize that 240 days of continuous service does not automatically grant a right to claim permanence.

The Court held that the order dated 07.09.2015 was passed on the basis of the circular dated 07.04.2015, which only provided for preference to retrenched employees in future vacancies. The court stated, “The Order of the Court cannot be interpreted on the basis of the impressions which may be drawn by the petitioners, in view of the specific order passed by this Court on 07.09.2015.”

The court also clarified that the petitioners could not claim a right to regular appointment against Group D posts merely because they were once engaged on muster rolls. The court stated, “The regular appointment can be made keeping in view the principles of public appointment which is by issuance of an advertisement giving opportunity to all eligible candidates to apply and to consider their suitability for the posts in non-discriminatory manner.”

The court emphasized that the contempt jurisdiction could not be invoked based on impressions and that there was no wilful disobedience of the court’s orders. The court stated, “The contempt would be made out when there is wilful disobedience to the orders of this Court. Since the Order of this Court is not of reinstatement, the petitioners under the garb of the contempt petition cannot seek reinstatement, when nothing was granted by this Court.”

What weighed in the mind of the Court?

The Supreme Court’s decision was primarily influenced by the interpretation of its previous order and the specific terms of the circular dated 07.04.2015. The court emphasized that the order dated 07.09.2015 was based on the concession given by the workmen in light of the circular, which only provided for preference in future vacancies. The court focused on the absence of a specific direction for reinstatement in its order and the fact that the circular was in compliance with Section 6Q of the U.P. Industrial Disputes Act, 1947.

The court also considered the change in the Jal Nigam’s work model, where projects were now executed through contractors, reducing the need for daily wage laborers. The court was not swayed by the petitioners’ argument that they should be regularized against Group D posts, stating that such appointments must follow prescribed rules and procedures.

The court also noted that the principle of equal pay for equal work was not applicable in the context of reinstatement of retrenched workers.

Fact:Law Ratio:

The court’s reasoning was more heavily influenced by legal considerations, including the interpretation of its previous order and relevant statutory provisions, than by the factual aspects of the case.

Logical Reasoning

Final Decision

The Supreme Court dismissed the contempt petitions filed by the retrenched workers. The court held that there was no wilful disobedience of its orders by the U.P. Jal Nigam. The court emphasized that its order dated 07.09.2015 was based on the concession given by the Jal Nigam to consider the retrenched workers for future vacancies, as per the circular dated 07.04.2015. There was no specific direction for reinstatement in its order. The court clarified that the contempt jurisdiction could not be invoked based on the petitioners’ impressions of the order.

The court also stated that the petitioners could not claim a right to regular appointment against Group D posts merely because they were once engaged on muster rolls. The court emphasized that such appointments must follow prescribed rules and procedures. The court also clarified that the principle of equal pay for equal work was not applicable in this case.

The court concluded that there was no contempt of its order, and therefore, the contempt petitions were dismissed.

Key Takeaways

• Specificity of Court Orders: The Supreme Court emphasized the importance of specific directions in its orders. An order based on a concession by one party, without a clear direction for reinstatement, cannot be interpreted as a mandate for automatic reinstatement.
• Compliance with Statutory Provisions: The court upheld that the Jal Nigam had complied with Section 6Q of the U.P. Industrial Disputes Act, 1947, by issuing a circular that provided preference to retrenched workers in future vacancies.
• No Automatic Right to Regularization: The court clarified that engagement on muster rolls does not grant an automatic right to regular appointment. Regular appointments must follow prescribed rules and procedures.
• Contempt Jurisdiction: The court emphasized that contempt jurisdiction cannot be invoked based on impressions or interpretations of court orders. There must be wilful disobedience of a specific direction.
• Equal Pay for Equal Work: The principle of equal pay for equal work was not applicable in this case, which dealt with the re-engagement of retrenched workers and not the parity of pay with regular employees.

Case Illustration