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2009 DIGILAW 5621 (MAD)

The Management of the Lakshmi Vilas Bank Limited Rep. by its Chairman & Another v. The Workmen of Lakshmi Vilas Bank Ltd. Rep. by the General Secretary The Lakshmi Vilas Bank Employees Union Karur & Others

2009-12-15

K.K.SASIDHARAN

body2009
Judgment Prayer In W.P.No.15134 of 1998 Writ Petition filed under Article 226 of the Constitution of India praying to issue a writ of Certiorarified Mandamus calling for the records of award dated 111. 1996 of the second respondent in I.D.No.73 of 1987 and quash a portion of the award rejecting the claim of 26 workmen and direct the first respondent to reinstate those 26 workmen with backwages, continuity of service and other attendant benefits and award cost.) These two writ petitions are directed against the award dated 111. 1996 in I.A.No.73 of 1987 on the file of the Industrial Tribunal, Madras. The management challenges the direction regarding reinstatement of six workmen. The Union is aggrieved by the dismissal of the claim in respect of twenty six workmen. BACKGROUND FACTS:- W.P.No.17822 of 1997 2. The petitioner is a banking company registered under the Companies Act. It has its registered office at Kathaparai near Karur with 200 branches in ten States and Union Territories. During the period in question, the Bank has employed more than 1000 staffs, who were "workman" within the meaning of the Industrial Disputes Act, besides 440 officers. 3. The petitioner was having adequate sub staff in proportion to clerical staff and officers employed in the various establishments. Whenever a permanent sub-staff fail to turn-up for duty, the branch used to engage a temporary sub-staff for that day. Therefore the engagement of sub-staff were only to meet the contingencies. 4. The permanent workman of the petitioner are represented by the first respondent Union and it has been recognised as the bargaining agent for the sub-staff. The issue of engagement of temporary sub-staff used to figure in the discussions the petitioner had with the first respondent Union. There was a meeting with the Union on 24. 1979 and as per the understanding, the management agreed to fill up the vacancies of permanent posts by fixing the ratio of appointments as 10:1 between the temporary sub-staff and new entrants. During the subsequent meeting held on 6. 2000, the Union made a representation that the daily wages of the temporary sub-staff should be increased and the qualification should be made as tenth standard instead of a pass in SSLC examination. The representation was considered and the daily wage of sub-staff was increased and the minimum qualification was fixed as tenth standard. 5. 2000, the Union made a representation that the daily wages of the temporary sub-staff should be increased and the qualification should be made as tenth standard instead of a pass in SSLC examination. The representation was considered and the daily wage of sub-staff was increased and the minimum qualification was fixed as tenth standard. 5. In July, 1983, the Union raised the issue of absorption of temporary sub-staff as permanent employees. After discussions, it was agreed that every temporary sub-staff who had completed minimum period of service of fifty days would be included in the list on 1st January of each year to be called for the test and interview and the seniority would be maintained region-wise in Tamilnadu and centre-wise in other States. There was a further agreement that future vacancies shall be filled up from and among the temporary sub-staff, who were to be selected from among the list in the ratio of 9:1. There was also a general agreement that the number of temporary sub-staff for a branch/office shall not exceed two or 50% of the regular permanent strength of that branch/office. 6. During September, 1983 the petitioner agreed to pay the temporary sub-staff the same rate of wages as paid to the permanent sub-staff. The petitioner also started maintaining separate attendance register and wages register for temporary sub-staff. In January, 1984, the petitioner decided to select persons for appointment to the permanent post from among the temporary sub-staff keeping them in the panel zone-wise and make future appointments from the panel as well as from direct recruitment in the ratio of 9:1 with the life of the panel fixed as one year. Accordingly 809 temporary sub-staffs were called for interview, out of which 398 appeared for test and interview. On the basis of the test and interview, a penal of 166 candidates was prepared by March, 1984. The panel was approved by the Board on 30.6.1984 and the Board decided that 50 candidates would be appointed against permanent vacancies. In the year 1985, 49 candidates from the panel of 166 temporary sub-staff were appointed against permanent vacancies and the remaining persons in the panel could not be appointed as the panel elapsed on the expiry of one year. 7. In the year 1985, 49 candidates from the panel of 166 temporary sub-staff were appointed against permanent vacancies and the remaining persons in the panel could not be appointed as the panel elapsed on the expiry of one year. 7. While the matters stood thus, the petitioner has taken a decision that the qualification for appointment as temporary sub-staff shall be Eighth Standard fail and the candidates should be between the age of 18-25 years. Consequently such of those employees who had crossed the age limit or who had possessed higher qualifications were not engaged as temporary sub-staff . 8. The Union raised a dispute consequent to re-fixation of qualification and the dispute was referred to the Industrial Tribunal for adjudication. 9. The Industrial Tribunal considered the earlier agreement between the petitioner and the Union in the light of the revised qualification and arrived at a finding that six workmen have completed 240 days of work in a given year and as such their termination was illegal. Accordingly they were directed to be re-instated into service. However the claim made by other 26 workers were rejected on the ground that they have not satisfied the prescribed period of work. Aggrieved by the said award, the Bank has filed this writ petition. W.P.No.15134 of 1998:- 10. The Union was assured by the decision of the Tribunal on account of the rejection of claim made by the other twenty six members. According to the Union, the management was abound by the minutes of the meeting and as such they cannot alter the conditions of service unilaterally. The twenty six employees were terminated only on account of over qualification. They have completed 240 days of works and as such the Tribunal erred in rejecting their claim. Accordingly the Union seeks reinstatement of twenty six workmen. .11. The Management hasfiled a counter in W.P.No.15134 of 1998 wherein they have also contended that there was a subsequent agreement between the management and the Union on 11. 1989 and as per the said agreement, the management has agreed for continuance of the revised qualification of seventh standard pass or eighth standard fail in respect of sub-staff. According to the management, the Tribunal misdirected itself and the claim of six employees were allowed on the basis of a document marked as Ex.M.10 which was nothing but a document originated from the Union. According to the management, the Tribunal misdirected itself and the claim of six employees were allowed on the basis of a document marked as Ex.M.10 which was nothing but a document originated from the Union. The Management further contended that there was total non-application of mind which made the Tribunal to pass the order for re-instatement. .ANALYSIS:- .12. There are certain undisputed basic facts in the matter. The Lakshmi Vilas Bank Employees Union was exposing the cause of the workmen. The Union alone was representing the entire workers before the Lakshmi Vilas Bank (hereinafter referred to as "the Bank"). The Bank has clearly admitted that the workmen were represented by the Union and they have been recognised as the bargaining agent for the staff. .Therefore the capacity of the Union to raise the dispute and to continue the proceedings cannot be disputed. Therefore the contention of the management that the Union was not entitled to represent the workers or to raise a dispute on their behalf has no basis. 13. There were series of meetings between the bank and the Union and the issue of conferring permanent status to the temporary sub-staff were also figured in such meetings. There was a joint meeting on 23 April, 1979 and in the said meeting it was unanimously agreed that the ratio of appointments from temporary sub-staff and new hands will be 10:1 The subsequent meeting was on 4 June, 1980. In the said meeting it was resolved to revise payment of daily wages of temporary peons and to revise the minimum qualification of casual labourers. On 1 July, 1983 the bank and the Union made deliberations with respect to the temporary staff. 14. The following decisions were taken in the meeting held on 7. 1983 with respect to temporary staff. "I. TEMPORARY PEONS:- After due discussions with the representatives of the Union, the following norms for appointment of temporary peons are recommended to the Board for favourable consideration. "A. Appointments:- .(1) Persons approved by the Personnel Department alone will be engaged as temporary peons. .(2) Age limit:- .(3) Qualification:- .(4) Seniority list and future absorption:- .(a) A temporary peon, who completes a minimum service of 50 days will be incorporated in the list prepared as on 1st January of each year and maintained by the Personnel department, according to his date of entrace as temporary peon at a branch/office. .(2) Age limit:- .(3) Qualification:- .(4) Seniority list and future absorption:- .(a) A temporary peon, who completes a minimum service of 50 days will be incorporated in the list prepared as on 1st January of each year and maintained by the Personnel department, according to his date of entrace as temporary peon at a branch/office. .(b) The seniority list shall be maintained region-wise in Tamil Nadu and Central-wise in other States. (For this purpose – a "region" will mean the areas in Tamil Nadu which were covered under each Regional office, and a "Centre" will mean the branch/s and or office/s in the city/town/village). .(c) A temporary peon will be given three months break of service, after completion of every 50 days. .(d) Future peon vacancies shall be filled up from amongst the temporary peons remaining in the list maintained by the Personnel Department, based on the date of entrance of the temporary peons. .(5) The appointment for the post of probationary Peons from the waiting list of the temporary peons and by direct recruitment shall be in the ratio of 9:1 .(6) The strength of temporary peons in the branch/office: The number of temporary peons fro a branch/office shall not exceed 2 or 50% of the regular peons strength of that branch/office. .(7) The existing temporary peons shall be intimated of their names being included in the panel maintained for the respective "Region"/"Centre", as the case may be. .(8) The applications for the temporary peons shall be forwarded by the concerned Branch Manager/A.G.M. of the respective Department, an the applicant shall be the native of the respective region/centre. .(9) If a temporary peon who is called for duty by the concerned branch/office and does not turn up for three times will be deleted from the list. .(10) A temporary peon will be enlisted only in one branch/office." Maximum age limit to enter as temporary peon is 24 years of age. S.S.L.C./Matriculation passed in old system or 10th Standard passed in "+2" System. 15. Subsequently, in the meeting held on 1. .(10) A temporary peon will be enlisted only in one branch/office." Maximum age limit to enter as temporary peon is 24 years of age. S.S.L.C./Matriculation passed in old system or 10th Standard passed in "+2" System. 15. Subsequently, in the meeting held on 1. 1984, the bank informed the Union that the management has informed that a decision was taken by the Board to select 125 persons from and out of the present list of temporary peons and keep them in the panel zone-wise and future appointments will be made from this panel as well as by way of direct recruitment at the ratio of 9:1. The validity of the list was for a period of one year. In the said meeting the Union represented that due consideration shall be given for seniority while constituting the panel. 16. While the matters stood thus, the Board of Directors of the Bank at its meeting held on 2 February, 1985 decided to re-fix the qualification of temporary peons as eighth standard. The Union was not consulted before re-fixing the qualification though the said decision was within the validity period of the panel. The decision to re-fix the qualification as eighth standard was communicated to different branches as per circular dated 14. 1985. As per the said circular, the Head Office directed the concerned branch to dispense with the service of those employees, who were over qualified. There was a further direction to employ only those candidates who failed eighth standard as sub-staff henceforth. 17. The dispute between the bank and the Union had arisen only on account of the revision of qualification. The Union raised a dispute on account of termination of the sub-staff and the Central Government referred the issue to the Industrial Tribunal, Madras. The dispute was registered as I.D.No.73 of 1987. .18. The Union filed a detailed claim before the Industrial Tribunal. According to the Union, the service of thirty two workers whose names found place in the Annexure to the reference was only on account of re-fixation of the qualification. They have contended that those 32 workmen had a vested right to be considered for appointment in permanent post on the basis of earlier agreements and as such their termination without following the provisions of Section 25-F of the Industrial Disputes Act was void. They have contended that those 32 workmen had a vested right to be considered for appointment in permanent post on the basis of earlier agreements and as such their termination without following the provisions of Section 25-F of the Industrial Disputes Act was void. .The Union also raised an issue that subsequent to the termination, the bank appointed several persons without offering employment to the retrenched workmen and as such the appointment was in violation of Section 25-H of the Industrial Disputes Act. 19. The Bank contested the claim before the Industrial Tribunal. In the counter filed by the Bank they have admitted the panel drawn from the sub-staff who were on the rolls and the inclusion of 125 sub-staff in the said panel, which was having a validity period of one year. The Bank disputed the contention that workers were in continuous service for a period of one year within the meaning of Section 25B of the Act. According to the Bank, engagement of thirty two employees mentioned in the Annexure to the order of reference was mainly and primarily depends on the absence of permanent sub-staff and therefore such engagements were irregular in nature. The bank also justified the decision taken by them to revise the qualification. The bank took exception to the contention raised by the Union with respect to their power to fix the qualification of their employees. 20. Before the Industrial Tribunal, the Union examined one witness and marked three documents in Exs.W.1 to W.3. The bank did not adduce oral evidence. However documents in Exs.M.1 to M.16 were marked on their side with consent. .21. The Industrial Tribunal framed the following question for consideration. ."Whether the action of the management of Lakshmi Vilas Bank Ltd., in terminating the services of 32 workmen/sub-staff is justified? If not to what relief the workmen concerned is entitled?" 22. The Tribunal overruled the objection taken by the bank with respect to the maintainability of the claim made by the Union and categorically held that the Union was competent to represent the workmen. The Tribunal also rendered a factual finding that on account of the revised qualification of eighth standard, the Management has not employed thirty two workmen, who were originally in the panel. The Tribunal also rendered a factual finding that on account of the revised qualification of eighth standard, the Management has not employed thirty two workmen, who were originally in the panel. However the Tribunal opined that reducing the educational qualification and increasing the maximum age limit are the prerogative of the management and therefore it was not pen to the Union to challenge such action. 23. According to the Tribunal, none of the persons who were already employed by the bank were affected on account of the revision in qualification and it was only those thirty two persons who were affected. The Tribunal accepted the case of the management that those employees whose names were included in the panel has no automatic right for appointment. 24. The Industrial Tribunal mainly relied on Ex.M.9 for the purpose of passing the order of re-instatement of six employees. The Tribunal proceeded as if the said document originated from the bank. Ex.M.9 contains names of six employes and their period of work in the bank. Accordingly the Tribunal rendered a factual finding that those six persons have worked for 240 days in twelve consecutive months in a year and the same was evident from the document submitted by the Management under Ex.M.9. The Tribunal opined that when the management has admitted that those six persons worked for more than 240 days within a year, the provisions of Section 25-F has to be scrupulously followed for the purpose of termination of those employees. It was only in such circumstances and purely based on Ex.M.9, the Tribunal directed the bank to reinstate those employees into their service. The claim of the remaining twenty six employees were rejected. 25. There is no dispute that the bank prepared a penal for the purpose of regularisation. The panel has got a validity period of one year. The pleadings also shows that those who got their names included in the panel were assured of regularisation in the said year subject to vacancy. The decision taken by the management to select 125 persons from and out of the list of temporary peons and to keep them in the panel zone-wise and for appointing them in future in the ratio of 9:1 and the one year validity of the said list are all matters of record. .26. The decision taken by the management to select 125 persons from and out of the list of temporary peons and to keep them in the panel zone-wise and for appointing them in future in the ratio of 9:1 and the one year validity of the said list are all matters of record. .26. While preparing the panel, the required qualification for appointment to the post of temporary peon was a pass in S.S.L.C. There is nothing on record to show as to when the panel was drawn. The counter statement filed by the bank is silent on that aspect. In any case, the decision to revise the qualification and to keep away those who got qualification more than eighth standard from appointment as peons was taken in the Board meeting on 2 February, 1985. Therefore the said decision was taken only during .the currency of the panel. Though the bank has made an attempt to justify the action on the ground that the circular dated 14. 1985 was issued only after the life time of the panel, the said contention has no basis. The circular dated 14. 1985 was only a consequential action to give effect to the decision taken by the Board on 2 February, 1985 to revise the qualification and to dispense with the service of all those who were over qualified. 27. There is no dispute that those thirty two employees were qualified for appointment as temporary sub-staff. In fact they were all having SSLC pass and above qualification, which was the essential qualification at that point of time. It was only during the currency of the panel, the bank has revised the qualification. Such revised qualification was made applicable to those who were already included in the panel. .28. Therefore the core question is as to whether the bank was entitled to remove the employees from the panel and to dispense with their service on the basis of revised qualification. In short, the issue as to whether the circular dated 14. 1985 was having a retrospective effect is also a question to be decided in the writ petition. .THE LAW:- 29. The learned counsel for the Union placed reliance on the judgment of the Supreme Court in St. In short, the issue as to whether the circular dated 14. 1985 was having a retrospective effect is also a question to be decided in the writ petition. .THE LAW:- 29. The learned counsel for the Union placed reliance on the judgment of the Supreme Court in St. Michaels Teachers Training Institute v. V.N. Karpaga Mary, (2008(3) LLN 737 = (2008) 7 SCC 388 ) in support of his contention that subsequent qualification cannot be enforced in respect to those who are already in service. The relevant paragraph reads thus:- "12. It is neither in doubt nor in dispute that the respondent possessed the requisite qualification at the time of her entry in the service. The educational qualification for a teacher was sought to be raised by the State much later, namely, in the year 1994. The respondent, indisputably, was appointed on a permanent basis. She was a regular teacher. If she was a regular teacher, the question of termination of her services relying on or on the basis of the purported GOMs dated 16-9-1994 did not arise as the same had not been given retrospective effect. The State never said that in terms of the said GOMs, the services of the employees who had validly been appointed, should be terminated." 30. The learned counsel for the Union while placing reliance on the judgment of the Supreme Court in Mohd. Riazul Usman Gani v. District & Sessions Judge, (2000) 2 SCC 606 , contended that higher qualification cannot be a disadvantage to the candidates. The observation of the Supreme Court reads thus:- "20. If an employee does not perform the duties attached to the post disciplinary proceedings can certainly be taken against him. An employer cannot throw up his hands in despair and devise a method denying appointments to a person who otherwise meets the requisite qualifications on the ground that if appointed, he would not perform his duties. Qualification prescribed is minimum. Higher qualification cannot become a disadvantage to the candidate. 21. A criterion which has the effect of denying a candidate his right to be considered for the post on the principle that he is having higher qualification than prescribed cannot be rational. We have not been able to appreciate as to why those candidates who possessed qualifications equivalent to SSC Examination could also not be considered. 21. A criterion which has the effect of denying a candidate his right to be considered for the post on the principle that he is having higher qualification than prescribed cannot be rational. We have not been able to appreciate as to why those candidates who possessed qualifications equivalent to SSC Examination could also not be considered. We are saying this on the facts of the case in hand and should not be understood as laying down a rule of universal application. 22. We do not think, therefore, that criterion four as laid by the Advisory Committee constituted under the Rules and upheld by the High Court is in any way reasonable or rational. By adopting such a course the High Court has put its stamp of approval to another type of reservation for recruitment to the service which is not permissible. A poor person can certainly acquire qualification equivalent to SSC Examination and not that he cannot go beyond Standard VII. Perhaps by restricting appointment to a candidate having studied only up to Standard VII the High Court may not be encouraging dropouts." .31. Though a reference was made in the pleadings that the name of those thirty two employees were included in the panel, no such panel appears to have been produced before the Industrial Tribunal. Therefore there is nothing on record to show that all these thirty two persons were included in the panel. The said aspect has not been dealt with in .detail by the Industrial Tribunal. The Industrial Tribunal appears to have proceeded on a wrong notion that Ex.M.9 was a document originated from the side of the bank and accepted the case of Union with respect to six workmen. 32. Ex.M.9 is admittedly a letter sent by the Union to the Assistant Labour Commissioner which contains the list of sub-staff/temporary peons with the details regarding their period of service in the bank. While directing re-instatement of the six employees the Tribunal referred to the said document in Ex.M.9 and construing the said document as an admission by the bank observed that even according to the bank those six employees have completed 240 days of service in a given year and as such their termination was bad. However no attempt was made by the Industrial Tribunal to ascertain as to whether the author of the said document was either the bank or the union. However no attempt was made by the Industrial Tribunal to ascertain as to whether the author of the said document was either the bank or the union. The bank has also contributed to the said confusion. 33. Admittedly the bank has not examined any witness before the Industrial Tribunal. Though, they have not produced any document to substantiate their contention that none of the thirty two workers have completed 240 days of work in a given year, the document in Ex.M.9 was produced by them and it was marked with consent. Therefore it cannot be said that no weight could be attached to the averments as found in the document cited as Ex.M.9. When the bank themselves have produced the document in Ex.M.9 which admittedly contained the name of the sub-staff with the actual number of days worked by them in the bank, the said document was taken as a valid piece of evidence. In any case, the bank has produced the registers to show the actual number of days worked by each of the thirty two employees. 34. The award of the Industrial Tribunal contains certain other factual mistakes also. The list appended to the form of reference does not contain the name of P.Kalayanakumar. However in paragraph 12 of the award the Tribunal directed reinstatement of said P.Kalyanakumar also. The learned counsel for the bank also contended that out of six employees Thiru M.Maheswaran is employed elsewhere and Mr.R.Guhanadoss is no more. The agreement stated to have been reached between the bank and the Union to revise the qualification appears to have been made only after the reference. However no documents were produced before the Industrial Tribunal in respect of any such settlement. 35. The learned counsel for the petitioner has also contended that when the Bank had engaged sub-staff subsequent to the retrenchment of thirty two workmen, the bank was obliged to employ the retrenched workers and the failure to employ them would result in violation of Section 25-H of the Industrial Disputes Act. The learned counsel also placed reliance on the judgment of the Division Bench of this Court as well as the Supreme Court in support of his contention that retrenched employees have to be employed first in case the management recruits employees subsequently. However the issue before the Industrial Tribunal was only regarding illegal termination of the thirty two workers belonging to the Union. However the issue before the Industrial Tribunal was only regarding illegal termination of the thirty two workers belonging to the Union. When there was no such reference with respect to subsequent events the Industrial Tribunal was not bound to decide the said issue. Therefore the award cannot be faulted on the ground that the issue regarding violation of Section 25-H was not considered by the Industrial Tribunal. .36. There are certain factual disputes which were not answered by the Industrial Tribunal. The question as to whether the name of thirty two persons were included in the panel was also a point of dispute. Though there are references in the pleadings about their inclusion in the panel, no documents were exhibited to prove the said contention. The effect of a revised qualification during the currency of the panel and the subsequent termination of employees were also not considered by the Industrial Tribunal. The management has not produced any material to show that what was stated in Ex.M.9 was incorrect. Therefore the entire issues need to be addressed to by the Industrial Tribunal afresh. .CONCLUSION:- 37. In the result, the award dated 111. 1996 is set aside and the matter is remitted to the Industrial Tribunal for fresh consideration. The Bank and the Union are permitted to produce evidence to substantiate their respective contentions. Since the matter is of the year 1997, the Industrial Tribunal is directed to decide the matter as expeditiously as possible and in any case, within a period of four months from the date of receipt of a copy of this order. 38. The writ petitions are disposed of with the above direction. Consequently, the connected WPMP are closed. No costs.