VIOLATION OF RETRENCHMENT PROCEDURE U/S 25F & 25G OF INDUSTRIAL DISPUTES ACT WARRANTS REINSTATEMENT, NOT MERE COMPENSATION: GUJARAT HIGH COURT

The Gujarat High Court in the case Rameshbhai Bhathibhai Pagi v/s Deputy Executive Engineer observed and has reiterated that once a Labour Court comes to the conclusion that Sections 25F, G and H of the Industrial Disputes Act have been violated and reinstatement of workman ought to follow.

The bench comprising of Justice Biren Vaishnav observed while hearing several petitions challenging the Labour Court’s order wherein compensation of Rs. 72,000 was awarded to each of the workmen-Petitioner rather than reinstatement with back wages.

It was submitted by the petitioner that their services were put to an end in August 2010 without following the procedure and without awarding compensation. It was pleaded by them that there was a clear violation of Sections 25(G) and (H).

However, the court stated that the Labour Courts had found the termination bad for each of the petitioners. While drawing an adverse inference against the Respondents, it has been awarded by the Labour Court the compensation which was meagre in the eyes of the petitioner, even as work was available. The Court observed that the Reliance was placed on Kalamuddin M. Ansari vs. Government of India, wherein similar facts and circumstances, the High Court ordered reinstatement of employees with continuity of service and had set aside the order of compensation.

The decision of the Labour Court was supported by the AGPs on the ground that there was a delay in raising the dispute. Further, the work had been outsourced at the canal. Therefore, the reinstatement was not possible.

The bench of Justice Vaishnav noted that the Labour Court had clearly concluded that there was a violation of sections 25(F), (G) and (H) of the ID Act. The only question raised was weather the Labour Court should have fallen short of awarding reinstatement with or without backwages.

In the present case, reference was made to Gauri Shanker vs. State of Rajasthan, wherein order of Labour Court had been modified by the Supreme Court of granting compensation in lieu of reinstatement. Further, Justice Vaishnav recalled the following observations of the Top Court:

The Division bench and the learned Single Judge under their supervisory jurisdiction should not have modified the award by awarding compensation in lieu of reinstatement which is contrary to the well settled principles of law laid down by this Court, in catena of cases.

Keeping in view the fact and the precedents that compensation would be detrimental to the Petitioners who had worked for more than 20 years. The order of the Labour Court was modified by the High Court of granting lump-sum compensation and ordered the employer to reinstate the workmen in service with continuity of service.