Industrial Disputes Act, 1947: s.9A – Change in conditions of service – In 1998, due to financial crunch, Government decided to enhance retirement age from 58 to 60 – Appellant-company implemented the said decision of government – However, since the financial position of appellant-company did not improve, government rolled back retirement age – Appellant-company restored the age of retirement to 58 years – Industrial dispute – Industrial Tribunal invalidated the action of appellant-company of rolling back the age of retirement from 60 years to 58 years due to contravention of r.9A which says prior notice must be given to employees by employer which the employer intentionally omitted to give in the instant case – High Court upheld the order of Industrial Tribunal – On appeal, Held: s.9A is a provision in consonance with the Constitutional mandate which assures the protection of principles of natural justice i.e., no one shall be condemned unless heard – s.9A provides that before changing either of the things as envisaged in the Fourth Schedule, prior notice must be given to the employee – Eighth clause of the Fourth Schedule says “withdrawal of any customary concession, privilege or change in usage” – The order of enhancement of superannuation of the employees though temporary in nature amounted to privilege to employees since it is a special right granted to them – Therefore, any unilateral withdrawal of such privilege amounts to contravention of s.9A of the Act and such act of the employer is bad in the eyes of law – Right to work is a vital right of every employee and it shall not be taken away without giving reasonable opportunity of being heard otherwise it would be an act of violation of the constitutional mandate – There is no error in the order of High Court – Service law. Industrial Disputes Act, 1947: Fourth Schedule, eighth clause – Eighth clause of the Fourth Schedule says “withdrawal of any customary concession or privilege or change in usage” – Terms “privilege” – Interpretation of – Held: The word “privilege” as such is not defined in the Act – The Dictionary meaning of the word “privilege” means a “special right, advantage or immunity granted or available only to a particular person or ground” – In other words, a particular and peculiar benefit or advantage enjoyed by a person, company, or class, beyond the common advantages of others – Order of enhancement of superannuation of the employees would amount to privilege to employees since it is a special right granted to them. Service law: Change in conditions of service – Enhancement of retirement age – Held: Age of superannuation is an integral part of the service condition of the employee – Also, enhancement of superannuation age would impliedly amount to a privilege since it was provided particularly for the central public sector employees. Interpretation of statutes: Beneficent law – Liberal construction – Held: Beneficial laws should be construed liberally – The Industrial Dispute Act, 1947 is one of the welfare legislations which intends to provide and protect the benefits of the employees – Therefore, it should be interpreted in a liberal and broad manner so that maximum benefits could reach to the employees – Industrial Dispute Act, 1947.
Words and phrases: Privilege – Meaning of.
Dismissing the appeals, the Court
HELD: 1. The Industrial Dispute Act, 1947 is one of the welfare legislations which intends to provide and protect the benefits of the employees. Hence, it shall be interpreted in a liberal and broad manner so that maximum benefits could reach to the employees. Any attempt to do strict interpretation would undermine the intention of the legislature. [Para 11] [514-F]
2. The grievance of the appellant-Company before this Court is that the increase in the superannuation age of the employees was temporary in nature in order to combat the losses and in no circumstances, it can be said that withdrawal of it amounts to withdrawal of customary concession or privilege or change in usage. Eighth clause of the Fourth Schedule says “withdrawal of any customary concession or privilege or change in usage”. The whole dispute revolves around the interpretation of the terms & ORS.
customary concession, privilege or change in usage. The word “privilege” as such is not defined in the Act. In the absence of statutory definition, recourse is taken of the dictionary or general meaning of the term “privilege”. The Dictionary meaning of the word privilege means a “special right, advantage or immunity granted or available only to a particular person or ground”. In other words, a particular and peculiar benefit or advantage enjoyed by a person, company, or class, beyond the common advantages of others. [Para 12] [514-G-H; 515-A-B]
3. Though the decision of enhancement of age of retirement was implemented without the amendment in the Standing Orders and Rules, yet impliedly it got the force as a service condition since it directly relates with the service condition of the employees. Age of superannuation is an integral part of the service condition of the employee. Also, enhancement of superannuation age would impliedly amount to a privilege since it was provided particularly for the central public sector employees. [Para 13] [515-D]
4. No doubt, the enhancement of the superannuation age was temporary in nature in order to achieve certain objectives and also it is not deniable that yet employees would be governed by the Service Rules and the Certified Standing Orders which were not amended. However, if the plea of the appellant-Company is allowed then it would defeat the object of legislature because legislature could never have intended that employees would be condemned without giving them right of reasonable hearing. Naturally, every employee is under the expectation that before reducing his superannuation age, he would be given a proper chance to be heard. Right to work is a vital right of every employee and it shall not be taken away without giving reasonable opportunity of being heard otherwise it would be an act of violation of the Constitutional mandate. The contention of the appellantCompany that the object of enhancement of superannuation age was just to save the industries from huge losses, however, it does not give the license to the appellant-Company to act in contravention of law since it is a cannon of law that everyone is expected to act as per the mandate of law. [Paras 14-15] [515-H; 516-A-B]
As published in the Supreme Court Reports, Supreme Court of India. Text from the Indian Supreme Court Judgments open data set (Dattam Labs), CC BY 4.0.
This page is for informational and research purposes only and does not constitute legal advice. Consult a qualified advocate for advice specific to your situation.