Supreme Court Upholds Termination of Apprentice Trainees: Ram Gopal Dwivedi vs. Kanpur Electricity Supply Co. Ltd. (25 July 2017)

Date of the Judgment: 25 July 2017
Citation: [Not Available in Source]
Judges: R.K. Agrawal, J., Abhay Manohar Sapre, J.
Can an employer terminate an apprentice’s training contract upon completion of the training period without it being considered an illegal termination? The Supreme Court of India addressed this question in the case of Ram Gopal Dwivedi vs. Kanpur Electricity Supply Co. Ltd., clarifying that apprentice trainees are not entitled to protections afforded to regular employees under labor laws upon completion of their training. The two-judge bench, composed of Justice R.K. Agrawal and Justice Abhay Manohar Sapre, delivered the judgment.

Case Background

The appellants were engaged by the Kanpur Electricity Supply Company Ltd. (KESC), a unit of the U.P. State Electricity Board, as trade apprentices. They were to undergo training in the trade of Boiler Attendant/Cable Jointer for a period of three years, as per the agreement under the Apprentices Act, 1961. The respondent terminated the services of one appellant on 01 August 1989 and the other on 13 July 1990, upon completion of their respective training periods. This termination led to an industrial dispute, which was referred to the Labour Court, Kanpur.

Timeline

Course of Proceedings

The Labour Court, Kanpur, ruled in favor of the appellants, holding that their termination was illegal because they were not paid retrenchment compensation, no inquiry was conducted, and they had served for more than two years, entitling them to labor law protections. The Labour Court ordered their reinstatement with 50% back wages. However, the High Court of Judicature at Allahabad overturned the Labour Court’s awards, relying on the Supreme Court’s decision in U.P. State Electricity Board vs. Shiv Mohan Singh & Anr., (2004) 8 SCC 402, which held that apprentice trainees are not entitled to the protections of labor laws upon completion of their training.

Legal Framework

The terms and conditions of the employees working with the respondent are governed by the statutory regulations framed by the Board in exercise of its powers under Section 78 (c) of the Electricity (Supply) Act, 1948. The appellants were engaged as trade apprentices under the Apprentices Act, 1961.

Arguments

The appellants contended that their termination was illegal because they were not paid retrenchment compensation, no inquiry was conducted, and they had served for more than two years, entitling them to labor law protections. They argued that they should be treated as regular employees and thus entitled to the benefits under labor laws. The respondent, on the other hand, argued that the appellants were engaged as apprentices under the Apprentices Act, 1961, and their services were terminated upon completion of their training period, as per the terms of their contract. The respondent relied on the decision of the Supreme Court in U.P. State Electricity Board vs. Shiv Mohan Singh & Anr., (2004) 8 SCC 402, which held that apprentice trainees are not entitled to the protections of labor laws upon completion of their training.

Issues Framed by the Supreme Court

The Supreme Court did not explicitly frame issues in the judgment. However, the core issue was:

1. Whether the termination of the appellants’ services as apprentice trainees upon completion of their training period was legal and proper.

Treatment of the Issue by the Court

Authorities

The Supreme Court relied on the following authority:

• U.P. State Electricity Board vs. Shiv Mohan Singh & Anr., (2004) 8 SCC 402, Supreme Court of India: This case held that apprentice trainees are not entitled to the protections of labor laws upon completion of their training.

Judgment

What weighed in the mind of the Court?

The Supreme Court’s decision was primarily influenced by the precedent set in U.P. State Electricity Board vs. Shiv Mohan Singh & Anr., (2004) 8 SCC 402. The Court emphasized the fact that the appellants were engaged as apprentices under the Apprentices Act, 1961, and their services were terminated upon completion of their training period, as per the terms of their contract. The Court also noted that the facts of the present case were almost identical to the facts of the earlier case, which made it imperative to follow the previous decision.

The Supreme Court reasoned that since the appellants were engaged as apprentices under the Apprentices Act, 1961, their termination upon completion of their training period was in accordance with the terms of their contract. The Court emphasized that apprentice trainees are not entitled to the protections afforded to regular employees under labor laws.

The Court stated: “In our considered opinion, the High Court was fully justified in placing reliance on the decision rendered by this Court in the case of U.P. State Electricity Board (supra) for allowing the respondent’s writ petitions and setting aside of the awards of the Labour Court. Indeed, the facts of this case and of U.P. State Electricity Board’s case (supra) are almost identical.”

The Court further noted: “It is rather unfortunate that the Labour Court did not take note of the law laid down in U.P. State Electricity Board’s case and wrongly set aside the termination orders.”

The Court concluded: “In view of foregoing discussion, we find no merit in the appeals, which thus fail and are accordingly dismissed.”

There were no dissenting opinions.

Key Takeaways

• ✓ Apprentice trainees are not entitled to the same protections as regular employees under labor laws upon completion of their training period.
• ✓ Termination of apprentice trainees upon completion of their training is legal and does not require retrenchment compensation or prior inquiry.
• ✓ Employers can rely on the terms of the apprenticeship contract when terminating an apprentice’s training period.
• ✓ This judgment reinforces the legal position that apprentices are primarily trainees and not regular employees.

Directions

No specific directions were given by the Supreme Court in this judgment.

Development of Law

The ratio decidendi of this case is that apprentice trainees are not entitled to the protections of labor laws upon completion of their training period. This judgment reinforces the position of law established in U.P. State Electricity Board vs. Shiv Mohan Singh & Anr., (2004) 8 SCC 402, and does not introduce any new legal principles.

Conclusion

The Supreme Court dismissed the appeals, affirming that the termination of apprentice trainees upon completion of their training period is legal and does not require any retrenchment compensation or prior inquiry. The Court relied on its earlier decision in U.P. State Electricity Board vs. Shiv Mohan Singh & Anr., (2004) 8 SCC 402, emphasizing that apprentices are not entitled to the same protections as regular employees under labor laws.