SUSPENSION CONSTITUTES INDUSTRIAL DISPUTE

IN THE HIGH COURT OF JUDICATURE AT MADRAS
Dated : 30..01..2008
Coram:
The Hon'ble Mr. Justice K.CHANDRU
W.P. No. 26665 of 2007
and
M.P. Nos. 1 and 2 of 2007
1. S. Thomas
2. Manali Petrochemicals Ltd.
Technical Employees' Union
Rep. By its General Secretary
(Regd. No. 1178/CPT)
Sathangadu Village
Manali
Chennai .. Petitioners
(P2 impleaded as per order dated
12.12.2007 in M.P. No.3 of 2007)
Vs.
1. The State of Tamil Nadu
Rep. by Secretary to Government
Labour and Employment Department
Fort St. George
Chennai 9

2. The Management of Manali Petrochemicals Ltd.
Rep. by its Managing Director
Ponneri High Road
Manali
Chennai .. Respondents

Petition filed under Article 226 of the Constitution of India seeking for issuance of writ of Certiorarified Mandamus calling for the records from the first respondent relating to the order in G.O. (D) No. 1300 Labour and Employment (A2) Department dated 21.12.2005 confirmed in the order dated 22.2.2007 and quash the said order dated 21.12.2005 confirmed in the order dated 22.2.2007 and direct the first respondent to refer the dispute of continued suspension of the petitioner for adjudication to a Labour Court.

For Petitioner : Mr. S. Ayyathurai

For Respondents : Mr. Ravindran
for M/s T.S. Gopalan & Co.

ORDER
Heard Mr. S. Ayyathurai, learned counsel appearing for the petitioner and Mr. Ravindran, learned counsel representing M/s. T.S. Gopalan, appearing for the respondents and perused the records.

2. The petitioner is a Technician employed by the second respondent company and he was in charge of Boiler duties. He was also elected as Vice President of the Manali Petrochemicals Technical Employees' Union formed in 1993. During 1996, he was made as General Secretary of the said Union. Since the settlement between the Union and the second respondent Management had ended in the December 2000, a new Charter of Demands was placed by the Union before the second respondent. Since the direct talks failed between the parties, a dispute was raised before the Conciliation Officer during the year 2003. It is alleged that in order to pressurize the workers, permanent employees working in the boilers, water treatment plant, Milk of lime plant and Fort Lift Operation were transferred to the main plant and in the place held by them, the second respondent attempted to engage contract workers. The petitioner was transferred from boiler plant to Propylene Glycol Plant which involves in hazarduous operation. Therefore, a dispute was raised against the transfer of permanent employees and the same was referred for adjudication by the Principal Labour Court and it was taken on file as I.D. No. 505 of 2005.

3. However, the second respondent placed the petitioner under suspension by an order dated 22.9.2003 stating that he was guilty of insubordination of the lawful orders of the superiors. An enquiry was conducted and show cause notice dated 25.10.2004 was issued to him. Despite the petitioner replied to the show cause notice, no final orders have been passed for the last three years. Therefore, the Trade Union to which the petitioner belonged, raised an industrial dispute before the Assistant Commissioner of Labour, Chennai 2. Upon a Failure Report being sent by the Officer, the first respondent State Government passed an order in G.O. (D) No. 1300 Labour and Employment Department dated 21.12.2005 refusing to refer the dispute. It is stated in the annexure to the said order that the dispute of temporary suspension cannot be considered as removal from service and since no punishment has been imposed, there is no necessity for the Government to refer the dispute for adjudication. The Trade Union filed an application for reviewing the order by a letter dated 25.12.2006 and the matter was once again taken by the Assistant Commissioner of Labour. Thereafter, the Trade Union was informed by a letter dated 22.02.2007 that there was no necessity to review the earlier order made in G.O. No. 1300 Labour and Employment Department dated 21.12.2005. Instead of the Trade Union challenging the said order, the petitioner in his individual capacity has filed the present writ petition challenging the said order.

4. An objection was taken by the second respondent Management that such a writ petition is not maintainable since the Trade Union has not come forward to file the writ petition and the petitioner cannot raise a dispute in respect of his suspension. To overcome the said objection, the Trade Union, viz., Manali Petrochemicals Ltd. Technical Employees' Union represented by its General Secretary (Regd. No. 1178/CPT) has filed an application in M.P. No. 3 of 2007 to implead themsleves as the second petitioner in the writ petition and the same was ordered by this Court on 12.12.2007. Therefore, the said objection fails.

5. A Division Bench of this Court vide its judgment reported in 1986 (2) L.L.J. 225 [Special Officer of the Management of TUCS Ltd. v. S. Loganathan] dealt with more or less a similar issue. In the aforesaid decision, an Arbitrator was appointed at the instance of the Union and the Management and that subsequently, two individual workers were aggrieved by the Arbitration Award which went against them. Since they were no longer in the Union and the Union was not interested in pursuing the said case, they had filed the writ petition challenging the Award. In paragraph 6 of the judgment, the Division Bench observed as follows:
Para 6: "Thirdly, it is contended by Mr. Dwarakanathan, learned counsel appearing for the first respondent, that the settlement under S. 12(3) on 2nd July, 1977 was duly arrived at the instance of the Union, espousing the cause of the workmen including the two petitioners and the arbitration before the second respondent also having been prosecuted by the Union on behalf of the two petitioners, the two petitioners cannot individually attack the award of the second respondent before this Court. It cannot be disputed that the two petitioners are "the persons affected" and we cannot deny them the right to invoke writ jurisdiction of this Court if there is a warrant for it, impeaching the award of the second respondent. Before us, submissions were made by both counsel with reference to the provisions of the Act enabling representations on behalf of the workmen. We need not necessarily resort to the provisions of the Act enabling the parties to agitate their rights either individually or through Union. Even within the Act individual workmen are enabled to agitate for their cause without reference to the Union. So far as powers of this Court are concerned, they shall always be available at the instance of persons who stand affected by the decisions of an authority like the second respondent. Our attention has not been drawn to any pronouncement which has taken a view contrary to what we have observed above. On the other hand, Miss Anna Mathew, learned counsel for the petitioners drew our attention to a pronouncement of the Supreme Court in Air India v. Nergesh Meerza [1981-II L.L.J. 314] to state that though the cause of the employees was earlier espoused by the Union, yet the individual employees themselves did agitate the matter before the Supreme Court and obtained reliefs. Whatever that be, as we have already pointed out, as persons affected, the petitioners can always invoke the jurisdiction of this Court under Art. 226 of the Constitution of India...."

6. Thereafter, Mr. S. Ayyathurai, learned counsel appearing for the petitioner submitted that the reason given by the Government to decline reference was illegal. The present dispute was raised relating to the prolonged suspension of the first petitioner and the dispute was raised by the second petitioner, which is only the recognised Union functioning in the second respondent establishment. The definition of an industrial dispute provided under Section 2(k) of the I.D. Act is so wide and it takes into account any difference of opinion between the workmen and the Management and, therefore, the scope of the definition cannot be curtailed by any artificial process and the reasoning given in the impugned order is unsustainable. It is not as if only in case of punishment, a dispute can be raised by the workman and even attempt to take disciplinary action can also be raised by a workman.

7. Even otherwise, the learned counsel drew the attention of this Court to the judgment of this Court reported in 1996 (2) L.L.J. 430 in the case relating to Kalyanasundaram, B. v. Labour Court, Madras and another and the relevant passages found in page 432 may be usefully extracted below:

''.... It is contended also that the worker was suspended pending the enquiry, that it was not a case of non-employment at all and that his suspension not being in the nature of punishment inflicted upon the worker, it could not be brought for adjudication as in the present case."

"In so far as the last point is concerned, whether or not suspension was a measure of punishment, I am really unable to see how an industrial dispute cannot arise out of such a direction made by the management. Even suspension amounts to non-employment of a worker and in relation to such non-employment alleged to be devoid of valid reasons, a dispute can be raised. So long as the dispute does not remain an individual dispute but assumes the form of an industrial dispute in which the general body of the workers display an interest, then, it cannot be said that a reference would not be proper. In this case, it is not denied by learned counsel on behalf of the management that all the seven employees are members of respondent 2 union and when respondent 2 union took up the matter before the labour officer for conciliation, it obviously offered clear indication that the union represented the body of the workers in sponsoring the cause of the employee. Though a dispute may start as an individual dispute, it assumes the form of an industrial dispute by the backing which the dispute received from other employees of that concern or by a union in which such employees are members. In this case, there is no doubt that this was the position and the contention that there was only an individual dispute which remained as such right through cannot possibly be accepted."

".... Any act of the employer which involves non-employment of a worker or violation of the terms of service upon which he is employed can give rise to an industrial dispute...."

8. However, per contra, Mr. Ravindran, learned counsel leading M/s T.S. Gopalan & Co. appearing for the respondent brought to the notice of this court the judgment of the Supreme Court in the Regional Director v. Employees' State Insurance Corporation v. Popular Automobiles and others [(1997) 7 SCC 665] and submitted that even though a suspension may be prolonged, that does not bring the relationship of the master and servant to a close and, therefore, there is no industrial dispute, be adjudicated. The learned counsel relied on the passage found in paragraph 9 of the said judgment and the same may be usefully extracted hereunder:
Para 9: "On the aforesaid scheme of this Act, therefore, it becomes very clear that all employees are entitled to get the statutory coverage of the benefits being insured employees and any person employed for wages is to be treated as an employee for the purpose of the Act. Under these circumstances an employee who is admittedly covered by the Act and who is entitled to get the benefits under the Act as insured employee will not cease to be an employee covered by the Act if he is placed under interim suspension pending domestic enquiry on any alleged misconduct by his employer. It is axiomatic to say that during suspension period pending enquiry the employer-employee relationship does not come to an end. It would come to an end only when after enquiry his services on proof of misconduct are ordered to be terminated. Till then he continues to be an employee for all purposes subject to only two consequences flowing from such interim suspension, namely, in the first place the employee will remain prohibited from actually offering his services and discharging his duties as the employer does not want him to do so and secondly during the period of suspension pending enquiry the remuneration payable to the employee will get curtailed and will be treated as subsistence allowance as legally permissible under the rules and which may range from 50% at the lowest to even 100% of the wages at the highest if the suspension continues beyond the requisite period as contemplated by the service rules and regulations concerned. It is also to be kept in view and there is no dispute on this aspect that even during suspension when the employee is being paid subsistence allowance and not full wages he remains entitled to get all the benefits as available to working employees on the same basis as laid down by various provisions of Chapter V. It is not as if a suspended employee gets lesser benefits as compared to a working employee under the provisions of the said chapter. They stand on a par. It is also to be appreciated that subsistence allowance is not to be refunded by the suspended employee whatever may ultimately be the result of the domestic enquiry. Hence only because the total remuneration paid to the suspended employee gets reduced to 50% or to any higher percentage going up to 100% it is not possible to appreciate as to how it can be said that on the amount of subsistence allowance received by him permanently he is not bound to contribute any amount to the Corporation and equally the employer of such a suspended employee is also not bound to make his parallel contribution as per the rates provided under the Act especially when all the benefits of statutory insurance coverage are made available by the Corporation to such a suspended employee...."

9. It is not clear as to how the said passage extracted above, helps the case of the second respondent Management. On the contrary, the question arose for the consideration by the Supreme Court was whether the suspended employee is entitled for the benefits under the ESI Act during the period of suspension and whether any recovery can be made from the Subsistence Allowance and whether the said allowance is also a wage liable for recovery towards subscription of ESI contribution. Further, even on the factual matrix, even after the show cause was given to the first petitioner after an enquiry and the first petitioner having given a reply as early as in the year 2004, it is not known as to what prevented the second respondent from passing appropriate orders. Certainly, such a prolonged suspension can be a subject matter of an industrial dispute.

10. Under Section 7 of the I.D. Act, the Labour Court is empowered to adjudicate disputes on a reference being made to it, in terms of the matters which are listed under the second Schedule prescribed under the Act. Item No. 1 of the Second Schedule reads as follows:
"The propriety or legality of an order passed by an employer under the Standing Orders"
A reading of the said provision read with Second Schedule will clearly show that the Labour Court is empowered to adjudicate even an issue relating to suspension pending enquiry since the said power by an employer has been exercised under the relevant Standing Orders. As the definition of Industrial Dispute under Section 2(k) of the I.D. Act read with Schedule I of the I.D. Act does not give any scope for restricting its scope and application and in the light of the judgment of this Court in Kalyanasundaram's case (cited supra), the impugned order is liable to be set aside.

11. In view of the above, the writ petition stands allowed and the impugned order is set aside. The first respondent is directed to refer the dispute relating to the suspension of the first petitioner for adjudication within a period of four weeks from the date of receipt of a copy of this order to a competent Industrial Tribunal / Labour Court for adjudication. No costs. Connected Miscellaneous Petitions are closed.



gri

To

The Secretary to Government
State of Tamil Nadu
Labour and Employment Department
Fort St. George
Chennai 9.