A five-judge Constitution bench of the Supreme Court last week ruled that dismissal of an employee when a labour dispute is pending would not be valid unless sanction was obtained from the tribunal.
If such approval is not granted, he would be deemed to be in continuous service. As a result, full wages will have to be paid to him. Moreover, the employer shall also be liable to six months in prison and payment of fine.
The unanimous judgment was delivered by a bench headed by Chief Justice S P Bharucha in the case of Jaipur Bhooi Vikas Bank Ltd which dismissed a cashier while proceedings were pending before the industrial tribunal. The tribunal found that the bank had not received sanction to dismiss him. It directed the bank to treat the employee as in continuous service, following the Supreme Court judgment in Tisco v S N Modak.
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The issue had to reviewed because there were differing judgments delivered by the Supreme Court itself at different times.
In the 1965 Tisco judgment, the court had ruled that if the approval was not granted under Section 33(2)(b) of the Industrial Disputes Act, the order of dismissal became ineffective from the date it was passed. Therefore the employee became entitled to wages from the date of dismissal to the date of disapproval of the application.
However, in the 1978 judgment in Punjab Beverages case, the court held that non-approval of the order of dismissal would not render the order of dismissal inoperative. It would only render the employer liable to punishment. The present judgment approved of the Tisco decision and held that the view expressed in Punjab Beverages was wrong.
The provision in question states that no workman shall be dismissed unless he has been paid wages for one month and an application has been made by the employer to the tribunal for approval of the action by the employer.
In the Tisco case, it was held that if the tribunal did not approve of the action taken by the employer, the result would be that the action taken by him would fall. Thereafter, the worker would be deemed never to have been dismissed and would remain in the service of the employer.
The court said that the section