M J Antony: Cross currents in labour decisions

OUT OF COURT

Temporary workers who approach the Supreme Court find its attitude has changed in recent years.

One of the recurring themes in Supreme Court judgements in the past months has been the right of casual workers to regularisation or permanency. Both government undertakings and private managements resist the claims of these workers, variously described as temporary, daily rated, casual or ad hoc. In some of the cases, individual workers have fought their cases from the labour court up to the Supreme Court for more than two decades. The high courts and the labour courts tend to pass orders in the workers' favour. The Supreme Court also used to follow this trend in the past. But in recent times, the tide seems to have changed against such workers.

In almost all recent judgements of the Supreme Court, it has set aside the orders in favour of the workers. The latest such judgement is Hindustan Petroleum Corporation vs Ashok Ambre. The company had engaged Ashok as an "unskilled workman" at its refinery in Mumbai way back in 1984. After three years, he moved the Bombay high court praying that he be declared as a permanent employee of the company and be granted all benefits with 18 per cent interest. The corporation retaliated by stopping him from engaging in any work. This led to an industrial dispute. The tribunal ruled that though he was a daily wage employee, as he had worked for long, his oral termination amounted to retrenchment and, therefore, he was entitled to reinstatement with back wages. The high court went further and asked the company to make him a permanent employee. Therefore, the company moved the Supreme Court. It overturned the orders of the courts below, stating that he was purely an ad hoc worker and his appointment was made without following the due process of law. However, the court asked the company to consider his case sympathetically as he had worked for it for more than two decades.

The case of Bihar Caustic & Chemicals Ltd vs Kripa Pandey is another case in which the worker fought all the way up to the Supreme Court for his dismissal from a factory in 1984. The company argued that he was employed by a labour contractor and all relationship stopped after the construction work was completed more than two decades ago. However, the labour court held that the termination was illegal and the worker was entitled to reinstatement with back wages from 1985. The Patna High Court confirmed the order. The company appealed to the Supreme Court. Meanwhile, he had retired after reinstatement. So the court stated that the company need to pay only 50 per cent of the back wages.

The Supreme Court took a definitive stand on such cases in the constitution bench decision in State of Karnataka vs Umadevi (2006). It was emphasised that daily wage earners could not make a backdoor entry by demanding regularisation. The creation and abolition of posts and regularisation are purely executive functions. The Umadevi judgement is now frequently quoted to upset the decisions of the labour courts and the high courts which have been merciful in recent times.

However, this binding constitution bench judgement has been overstepped by the Supreme Court itself in a recent judgement. In UPSEB vs Pooran, some 34 daily wage workers of the Co-operative Electric Supply Society prayed for regularisation by the board as it had taken over the society. The Allahabad High Court directed the board to do so. It moved the Supreme Court only to find that the Supreme Court was not in favour of the management for the first time in many months. The judgement said: "The workers have put in about 22 years' service and it will surely not be reasonable if their claim for regularisation is denied even after such a long period of service."

The judges justified this departure from the rules set earlier by adopting an argumentative device normally used by lawyers when they are faced with a binding precedent. Though lawyers revere precedents to the point of ancestor worship, when they have to win an argument, they distinguish the precedent from the present case on facts. The two-judge bench of the Supreme Court adopted this tactic in the present electricity board case. It said that the Umadevi judgement, though delivered by a constitution bench, should not be applied by courts "mechanically, as if it were a Euclid's formula without seeing the facts of a particular case." A little difference in facts or even one additional fact may make a lot of difference in the precedential value of a decision. Here, then, is a crack in the wall set up by the Supreme Court itself against casual workers.