Retrenchment of the Workman must be proved to gain the right re-employment under 25(H) of the Industrial Disputes Act, 1947

Aashray Chaudhary | Symbiosis Law School, Hyderabad | 29th December 2019

Management of the Banara Cooperative Marketing-cum-Processing Society Ltd. v. Workman Pratap Singh

Facts

• The respondent here worked as a Peon in the appellant Cooperative marketing society. The appellant terminated his services and aggrieved by the termination the respondent made a reference through the State to the Labour Court to decide the legality and correctness of his termination order. The labour Court held the termination as bad in law and accordingly awarded lump sum compensation to the respondent in lieu of reinstatement in service, which respondent accepted.
• After a few years the respondent filed a representation to the appellant asking for re-employment in terms of Section 25(H)[1] of the Industrial Disputes Act (hereinafter referred as “the act”) as the appellant had regularised the services of two peons between this period of time.
• On the refusal of appellant the respondent made an industrial reference to the Labour Court. The Labour Court answered in favour of the appellant. After which the respondent filed a writ petition in the High Court, which ordered for re-employment of the respondent. Aggrieved by the order the Appellant filed an appeal before the Division Bench on dismissal of which he filed the present appeal before the Apex Court.

Issue

• Whether the respondent was entitled to claim re-employment in the appellant’s services?

What was held?

• The Court allowed the appeal and held that the respondent was not entitled to seek re-employment under section 25(H) of the act.
• The Court based its ruling on two reasons. Firstly, the fact that the respondent had accepted the compensation awarded by the labour Court in lieu of his right to reinstatement in service and secondly that Section 25(H) has no application in this case.
• The court was of the opinion that in order to attract the provision of section 25(H) of the act, it must be proved by the workman that firstly, he was “retrenched employee” and secondly his ex-employer has decided to fill up vacancies in their set up and therefore he is entitled to claim preference over any other persons while seeking re-employment in the services.
• The present case was not of retrenchment as the respondent had accepted the compensation awarded by the labour court in lieu of his right of reinstatement. It was also observed that as no fresh employment was being offered in this case, the appellant merely regularised the services of an employee already in service. In which case there is no question of re-employment opportunity under section 25(H).

[1] Section 25(H) provides for re-employment of retrenched workman. Basically it says that when an employer retrenches some of its workforce, the next time he is looking for workmen he should consider the ones retrenched first.