The Supreme Court has held that termination of service of people, who had been engaged for a specific purpose after the completion of the work, would not amount to retrenchment and such people would not be eligible for the benefits granted under the Industrial Disputes Act.
The apex court thus overruled the Punjab and Haryana High Court judgment that the workers would be eligible for retrenchment benefits.
The Haryana Warehousing Corporation had entrusted the procurement of wheat to a private firm in the state. Since there were not enough godowns to stock the wheat, they had to be stored in open spaces. For guarding this, security guards were appointed for the period till the stocks were disposed of. When the stocks were cleared, the workers were terminated. They challenged this and raised an industrial dispute.
The state government referred the dispute to the labour court. It rejected their claim stating that they were engaged for a specific period for a specific purpose. After the purpose was served, they could not claim any benefits, according to the award of the labour court.
On appeal, the Punjab and Haryana High Court set aside the award of the labour court and ordered reinstatement of the workers with full back wages.
The employers, therefore, moved the Supreme Court. The Bench comprising Justice D P Mohapatra and Justice K G Balakrishnan reversed the Punjab and Haryana High Court decision and held that the labour court was correct.
The judgment interpreted Section 2(oo)(bb) of the Industrial Disputes Act which dealt with retrenchment. It states
