Headnote
AI-drafted · Reviewed and approved
The appellant-workman was employed as a helper with the respondent-company from 01.05.1995 and was terminated from service on 27.12.2011 after 16 years of continuous service. Aggrieved by the termination, he raised an industrial dispute which was heard by the Labour Court, Junagadh in Reference (T) No. 26 of 2013. The Labour Court, instead of granting reinstatement, awarded a lump sum compensation of Rs.1,50,000/- taking into account the length of service. On a writ petition before the Single Judge of the Gujarat High Court, the compensation was enhanced to Rs.3,50,000/-.
The appellant preferred a Letters Patent Appeal seeking further enhancement of compensation to Rs.8,00,000/- relying on a co-ordinate Division Bench judgment in LPA No. 599 of 2022, wherein for a workman with 10 years of service, lump sum compensation of Rs.5,00,000/- was awarded by substituting reinstatement and 25% back wages. The Division Bench in the present matter considered the principle that reinstatement is not automatic upon a finding of illegal termination or breach of Section 25F of the Industrial Disputes Act, 1947, and that monetary compensation may be more appropriate, particularly for daily-rated workmen.
Relying on a catena of Supreme Court decisions including Jagbir Singh v. Haryana State Agriculture Mktg. Board, Bhopal v. Santosh Kumar Seal, and Rajasthan Development Corpn. v. Gitam Singh, the court reaffirmed that the relief of reinstatement with back wages is not automatic and that compensation in lieu thereof meets the ends of justice. Keeping in view the appellant's longer tenure of 16 years as compared to 10 years in the precedent case, the Division Bench proceeded to determine an appropriate enhanced lump sum compensation.
Catchwords:
industrial dispute · wrongful termination · retrenchment · Section 25F · lump sum compensation · reinstatement · back wages · daily-rated workman · length of service · Letters Patent Appeal · Labour Court · Gujarat High Court
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