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INDUSTRIAL DISPUTE

ACT & THE CONTRACT


LABOUR & ABOLITION
ACT

BY ,
RASHMI . S
ROLL NO : 27 .
SEC 2A : DISMISSAL , ETC . OF AN
INDIVIDUAL WORKMAN TO BE
DEEMED TO BE AN INDUSTRIAL
DISPUTE .

 Where any employer discharges, dismisses, retrenches or otherwise
terminates the services of an individual workman, any dispute or
difference between that workman and his employer connected with,
or arising out of, such discharge, dismissal, retrenchment or
termination shall be deemed to be an industrial dispute
notwithstanding that no other workman nor any union of workman
is a party to that dispute.
MARKETING FEDERATION LTD V / S
SANJAY – 22 JULY , 2009
 IN THE SUPREME COURT OF INDIA
 CIVIL APPELLATE JURISDICTION
 CIVIL APPEAL NO: 4605 OF 2009
 (Arising out of SLP(C) No. 1201/2008)
 Haryana State Co-operative Supply
 APPELANT – MARKETING FEDERATION LTD V/S
 RESPONDENT - SANJAY

SUPREME COURT
JUDGEMENT

Ø Ruled against the judgment of the High Court of
Punjab and Haryana whereby Division Bench of
that Court upheld the award passed by the
Industrial Tribunal-Cum-Labour Court, Hissar
ordering reinstatement of the respondent-workman
with continuity of service and payment of 50%
back wages.
ISSUE ???
Ø
????
Ø Sanjay, respondent, was engaged as Chowkidar on causal basis by the
District Manager, HAFED, Jind on August, 1998 for 29 days. On
expiry of the said contract, fresh contracts were executed from
time to time and he rendered service there until December 31,
1998. He was engaged afresh by the District Manager, HAFED, Hissar
on January 15, 1999 where he worked upto May 31, 1999.
Ø
Ø As the service of the respondent was not renewed after May 31, 1999,
he issued demand notice under Section 2A of the Industrial
Disputes Act, 1947 (for short "ID Act") raising dispute to the
effect that his services were illegally terminated.
RESPONDENT ’ S ARGUMENT ….
 The respondent , before the Labour Court set up the case that he had
completed more than 240 days of continuous service in the year preceding
the date of termination with the HAFED. He raised the grievance that
without following the mandatory procedure provided in Section 2 25-F of
the ID Act, his services were terminated which amounted to illegal
retrenchment.

 It is pertinent to notice here that the respondent clubbed the period of


his engagement with District Manager, HAFED, Jind and District Manager,
HAFED, Hissar while computing 240 days of continuous service.
APPELANT ’ S ARGUMENT ….
Ø
Ø The Appellant-Management set up the plea that the workman was
engaged on contractual basis by the District Manager, HAFED, Jind
for the period from August 1, 1998 to December 31, 1998 and there
he completed 145 days of service.
Ø
Ø The District Manager, HAFED, Hissar, which is a separate industrial
establishment, engaged the workman afresh on January 15, 1999
upto May 31, 1999 and accordingly, workman worked in the office
of District Manager, HAFED, Hissar for 112 days.
Ø
LABOUR COURT
DECISION
The Management, thus, set up a specific case that the workman
worked at two different units of HAFED and the period of service
rendered at these two places cannot be clubbed for the purposes of
Section 25-F of the ID Act. The case of the Management was that the
workman having not completed 240 days of continuous service, there
was no necessity of compliance of Section 25-F of the ID Act.

ØIndustrial tribunal cum labour court – violation of sec 2 25F.


Reinstatement of workman with 50% wages.
Ø
SUPREME COURT
DECISION
Ø The Supreme Court of India said that “For the purposes of applicability of
Section 25-F, the workman has to show that he has been in continuous
service for not less than one year under an employer. A workman is
deemed to be in continuous service for a period of one year if during
the period of 12 calendar months preceding the date of termination, he
has actually worked under the employer for not less than 240 days by
virtue of Section 25B(2) of the ID Act. The words "has been in continuous
service.......... under an employer" in Section 25-F are crucial. “
Ø
Ø The offices of the HAFED Jind & Hissar though under the same unit are
separate establishments, hence Mr. Sanjay has not worked for the
required 240 days for the fulfillment of sec 25F.
Ø
Ø Therefore, similar to the cases of DGM Oil & Natural Gas
Corporation Ltd. & Anr. v. Ilias Abdul Rehman & Union of India v.
Jummasha Diwan .

Ø hence, Industrial tribunal did not do a thorough reference and also


did not see that no transfer order between the establishments
has been given.
Ø
Ø Therefore, the appeal is, accordingly, allowed. The Judgment dated
May 7, 2007 passed by the High Court and the Award dated
February 8, 2006 passed by the Industrial Tribunal-Cum-Labour
Court, Hissar are quashed and set aside. The parties will bear
their own costs.
THE CONTRACT
LABOUR &
ABOLITION ACT ,
1970
SEC 10 – PROHIBITION OF
EMPLOYMENT OF CONTRACT LABOUR
 Sub Section 1:

 Notwithstanding anything in this act, the
appropriate government may , after consultation
with the Central Board, or as the case may be ,
State Board, prohibit, by notification in the
Official Gazette, employment of contract labour
in any process, operation or other work in any
establishment.
CONDITIONS &
FACTORS
 Sub-section (2) of Section 10 lays down sufficient
guidelines for deciding upon the abolition of
contract labour in any process, operation or
other work in any establishment.

 The guidelines are mandatory in nature and are:-
Conditions of work and benefits provided to the
contract labour.
Ø
ØWhether the work is of Perennial nature.- sufficient duration

ØWhether the work is incidental or necessary for the work of an


establishment.

ØWhether the work is sufficient to employ


a considerable number of whole-time workmen.
Ø
ØWhether the work is being done ordinarily through regular workman in
that establishment or a similar establishment.
Ø
ØIf the question arises if a process is perennial or not, the
decision of the appropriate government is deemed to be final.
Ø
SUPREME COURT
JUDGEMENTS
Ø
Ø Landmark cases –
Ø Gujarat State Electricity Board Vs Union of India,
Ø Air India Statutory Corporation Ltd. & Ors Vs United
Labour Union & Others.
Ø Steel Authority of India Ltd. & Others Vs National
Union of Waterfront Workers and others on
09.05.1995, 6.12.1996 and 30.08.2001 respectively
GUJRAT STATE ELECTRICITY
BOARD CASE

Ø The Supreme Court recommended that the Central


Government should amend the Act by incorporating a
suitable provision to refer to industrial adjudicator
,the question of the direct employment of the workers
of the
Ø Ex-contractor in the principal establishments,
Ø When the appropriate Government abolishes the contract
labour.
AIR INDIA STATUTORY
CORPORATION CASE
Ø Supreme Court held that though there exists no express
provision in the Act for absorption of employees in
establishments where contract labour system is abolished by
publication of the notification under section 10 (1) of the
Act, the principal Employer is under statutory obligation to
absorb the contract labour. The linkage between the
contractor and employee stood snapped and direct
relationship stood restored between
principal employer and contract labour as its employees.
Ø
STEEL AUTHORITY OF
INDIA - SAIL
Ø The Supreme Court has held that neither Section 10 of the Act
nor any other provision in the Act whether expressly or by
necessary implication provides for automatic absorption of
contract labour on issuing a Notification by the appropriate
Government under sub section (1) of Section 10 prohibiting
employment of contract labour
Ø In any process or operation or other work in any establishment.
Ø Consequently the Principal Employer cannot be required to order
which are perennial in nature for following reasons:-
Ø
Ø
Ø
Ø Reduction of regular employment;
Ø The contract labour generally belong to weaker sections of the
society and will be deprived of the benefits that accrue to
regular employees.
Ø Efficiency will decrease as establishment will be deprived of
experienced staff.
Ø Coordination of activities of large number of
Ø contractors/sub-contractors will prove to be
Ø more time consuming and costly than in house activity.
Ø What is required is not privatization but in house improvements
and restructuring
Ø
THANK YOU .