2025 INSC 144
SUPREME COURT OF INDIA
(HON’BLE
VIKRAM NATH, J. AND HON’BLE PRASANNA B. VARALE, JJ.)
SHRIPAL
Petitioner
VERSUS
NAGAR NIGAM, GHAZIABAD
Respondent
Civil
Appeal No.8157 OF 2024 With Civil Appeal Nos.8158-8179 OF 2024-Decided on
31-01-2025
Labour Law, Industrial Dispute
U.P. Industrial
Disputes Act, 1947, Section 6E, 6N – Industrial Dispute - Claim for
regularisation -
Termination during the pendency of the conciliation proceedings – Held that any
unilateral alteration in service conditions, including termination, is
impermissible during the pendency of such proceedings unless prior
approval is obtained from the appropriate authority - The record in the present
case does not indicate that the Respondent Employer ever sought or was granted
the requisite approval - Prima facie, therefore, this conduct reflects a
deliberate attempt to circumvent the lawful claims of the workmen, particularly
when their dispute over regularization and wages remained sub judice - Respondent
Employer consistently labelled the Appellant Workmen as casual employees (or
workers engaged through an unnamed contractor), yet there is no material proof
of adherence to Section 6N of the Act, 1947, which mandates a proper
notice or wages in lieu thereof as well as retrenchment compensation - In this
context, whether an individual is classified as regular or temporary is
irrelevant as retrenchment obligations under the Act must be met in all cases
attracting Section 6N - Any termination thus effected without statutory
safeguards cannot be undertaken lightly - Impugned order of the High Court, to
the extent they confine the Appellant Workmen to future daily-wage engagement without
continuity or meaningful back wages, set aside with the following directions:
I. The discontinuation
of the Appellant Workmen’s services, effected without compliance with Section
6E and Section 6N of the U.P. Industrial Disputes Act, 1947, is declared
illegal. All orders or communications terminating their services are quashed.
In consequence, the Appellant Workmen shall be treated as continuing in service
from the date of their termination, for all purposes, including seniority
and continuity in service.
II. The Respondent
Employer shall reinstate the Appellant Workmen in their respective posts (or
posts akin to the duties they previously performed) within four weeks from the
date of this judgment. Their entire period of absence (from the date of
termination until actual reinstatement) shall be counted for continuity of
service and all consequential benefits, such as seniority and eligibility for
promotions, if any.
III. Considering the
length of service, the Appellant Workmen shall be entitled to 50% of the back
wages from the date of their discontinuation until their actual reinstatement.
The Respondent Employer shall clear the aforesaid dues within three months from
the date of their reinstatement.
IV. The Respondent
Employer is directed to initiate a fair and transparent process for
regularizing the Appellant Workmen within six months from the date of
reinstatement, duly considering the fact that they have performed perennial
municipal duties akin to permanent posts. In assessing regularization, the
Employer shall not impose educational or procedural criteria retroactively if
such requirements were never applied to the Appellant Workmen or to
similarly situated regular employees in the past. To the extent that sanctioned
vacancies for such duties exist or are required, the Respondent Employer shall
expedite all necessary administrative processes to ensure these long time
employees are not indefinitely retained on daily wages contrary to statutory
and equitable norms.
(Para
9, 10 and 18)
JUDGMENT
Vikram Nath, J. :- These appeals, one
filed by certain workmen (hereinafter, the workmen in all the appeals are
referred to as the Appellant Workmen) and the other by the employer department
i.e., Ghaziabad Nagar Nigam (hereinafter referred to as the Respondent Employer
as the employer in all the appeals), arise out of a common final judgment and
order dated 01.03.2019, passed by the High Court of Judicature at Allahabad
in Writ Petition No. 13381 of 2012 and connected matters.
2.
By the impugned judgment, the High Court considered the legality of two
conflicting sets of awards passed by the Labour Court, Ghaziabad—one set
allowing reinstatement of some workmen with partial back wages, and another set
denying relief altogether to other similarly placed workmen.
3.
The factual matrix leading up to the appeal before us is as follows:
3.1.
The Appellant Workmen claim to have been engaged as Gardeners (Malis) in the
Horticulture Department of the Respondent Employer, Ghaziabad Nagar Nigam,
since the year 1998 (in some instances, since 1999). According to them, they
continuously discharged horticultural and maintenance duties— such as planting
trees, maintaining parks, and beautifying public spaces—under the direct
supervision of the Respondent Employer. They further allege that no formal
appointment letters were ever issued to them, and that they were persistently
denied minimum wages, weekly offs, national holidays, and other statutory
benefits.
3.2.
In 2004, the Appellant Workmen, along with many other similarly situated
employees, raised an industrial dispute (C.B. Case No. 6 of 2004) before the
Conciliation Officer at Ghaziabad, seeking regularization of their services and
the requisite statutory benefits. They contend that, upon learning of this
demand, the Respondent Employer began delaying their salaries and subjected
them to adverse working conditions. Eventually, around mid-July 2005, the
services of numerous workmen were allegedly terminated orally, without any
notice, written orders, or retrenchment compensation.
3.3.
Since the above termination took place during the pendency of the conciliation
proceedings, the Appellant Workmen argue it violated Section 6E of
the U.P. Industrial Disputes Act, 1947. Consequently, the State Government
referred the disputes concerning both (i) regularization and (ii) legality of
the alleged termination, to the Labour Court, Ghaziabad for adjudication.
3.4.
The Labour Court proceeded to decide the references vide two orders:
(i) Order dated
03.06.2011: In numerous adjudication cases (e.g., Adjudication Case Nos.
448, 451, 467 of 2006, etc.), the Labour Court passed awards holding the
terminations illegal for want of compliance with Section 6N of the
U.P. Industrial Disputes Act, 1947, and directed reinstatement with 30% back
wages.
(ii) Order dated
11.10.2011: However, in about 41 other adjudication cases (e.g., Adjudication
Case Nos.269, 270, 272, etc.), the Labour Court arrived at a contrary
conclusion, dismissing the claims on the finding that the concerned workmen had
not been engaged directly by the Nagar Nigam but rather through a contractor,
and hence had no enforceable right to reinstatement or regularization against
the Respondent Employer.
3.5.
Aggrieved by the adverse portion of the awards (i.e., those granting
reinstatement), the Respondent Employer, Ghaziabad Nagar Nigam, filed several
writ petitions before the High Court of Judicature at Allahabad, challenging
the Labour Court’s findings. On the other hand, the workmen whose claims were
dismissed by the other set of awards also approached the High Court by filing
their own writ petitions. All these writ petitions were heard together,
culminating in the common judgment dated 01.03.2019, which partly modified
the Labour Court’s conclusions.
3.6.
Through the impugned judgment, the High Court held that while the Labour Court
was correct in exercising jurisdiction under the U.P. Industrial Disputes
Act (since municipalities could be treated as “industry”), there remained
factual complexities as to whether the workmen were genuinely on the rolls of
the Nagar Nigam or were provided by contractors. The High Court also noted that
the State Government had, by notifications/orders, placed a ban on fresh
recruitments in Municipal Corporations, thereby restricting direct appointments
to any post. Ultimately, the High Court partially modified the relief granted,
directing re-engagement of the workmen on daily wages, with pay equivalent to
the minimum in the regular pay scale of Gardeners, while allowing future
consideration of their regularization if permissible by law.
4.
Both the Appellant Workmen and the Respondent Employer have now approached this
Court by way of Special Leave Petitions. The workmen primarily seek full
reinstatement with back wages and a direction to secure their regularization, whereas
the Respondent Employer seeks to quash the modifications ordered by the High
Court on the ground that the High Court exceeded its jurisdiction by granting
partial relief akin to regular employees, contrary to constitutional provisions
and the State’s ban on recruitment.
5.
Learned counsel for the Appellant Workmen made the following submissions:
I. Continuous Service
& Comparable Duties: The Appellant Workmen had continuously discharged
horticultural and maintenance duties— like planting trees, upkeep of public
parks, and general beautification—under the direct supervision and control of
the Respondent Employer for periods often exceeding a decade. They insist such
long- standing, continuous work parallels that of permanent Gardeners.
II. Direct Engagement
& Wage Disbursement: They aver that their wages, though inadequate, were
paid directly by the Horticulture Department of the Respondent Employer,
nullifying the Employer’s claim of contractual hiring. Muster rolls and
internal notes are cited to show direct employer-employee relations.
III. Illegal
Termination: Alleging violation of Sections 6E and 6N of
the U.P. Industrial Disputes Act, 1947, the Appellant Workmen maintain their
abrupt termination in July 2005 (during pendency of conciliation proceedings)
was devoid of due process and statutory payments, rendering it patently
illegal.
IV. Entitlement to
Reinstatement & Regularization: Given their long service and the principle
of “equal pay for equal work,” the Appellant Workmen submit they deserve full
reinstatement with back wages and a legitimate pathway to regularization, as
opposed to the partial relief of mere daily-wage re-engagement prescribed by
the High Court.
6.
On the other, the learned counsel for the Respondent Employer, Ghaziabad Nagar
Nigam made the following submissions:
I. Compliance with Constitutional
Requirements: Emphasizing the constitutional scheme of public employment, it is
urged that there was (and remains) a ban on fresh recruitment in Municipal
Corporations, and no proper selection process was ever followed to appoint the
Workmen on any sanctioned posts.
II. No Direct
Employer-Employee Relationship: The Respondent Employer contends that all
horticulture work was carried out through independent contractors appointed via
tender processes. It claims any partial wage documentation cited by the Workmen
fails to establish direct engagement.
III. Inapplicability
of Regularization: Relying on Secretary, State of Karnataka vs. Umadevi[(2006) 4 SCC 1] , it is asserted
that no daily wager can claim permanent absorption without adherence to
constitutional requirements and availability of duly sanctioned vacancies.
IV. Inadequate Proof
of 240 Days’ Service: The Respondent Employer points out that the Workmen did
not convincingly demonstrate they completed 240 days of continuous work in any
calendar year, thus undermining the assertion that their cessation from service
was illegal.
V. Challenge to Modified
Relief: Finally, it argues that the High Court’s direction to pay minimum-scale
wages and to consider the Workmen for future regularization oversteps legal
boundaries, disregards the recruitment ban, and fosters an impermissible avenue
of public employment. The Respondent Employer, therefore, seeks the quashing of
the impugned judgment.
7.
Having heard the arguments and submissions of the learned counsel for the
parties and having perused the record, this Court is of the considered opinion
that the nature of engagement of the Appellant Workmen, the admitted shortage
of Gardeners, and the circumstances under which their services were brought to
an end, merit closer scrutiny.
8.
It is undisputed that, while the Appellant Workmen were pressing for regularization
and proper wages through pending conciliation proceedings, the Respondent
Employer proceeded to discontinue their services, without issuing prior notice
or granting retrenchment compensation. At this juncture, it is to have a look
at the requirements of Section 6E of the U.P. Industrial Disputes Act,
1947 which has been reproduced hereunder:-
“6E. [ Conditions of
service, etc. to remain unchanged in certain circumstances during the pendency
of proceedings. [Inserted by U.P. Act No. 1 of 1957.]
(1) During the
pendency of any conciliation proceeding before a Conciliation Officer or a
Board or of any proceeding before a Labour Court or Tribunal in respect of an
industrial dispute, no employer shall, -
(a) in regard to any
matter connected with the dispute, alter, to the prejudice of the workmen
concerned in such dispute, the conditions of service applicable to them
immediately before the commencement of such proceeding, or
(b) for any misconduct
connected with the dispute, discharge or punish, whether by dismissal or
otherwise any workman concerned in such dispute save with the express
permission in writing of the authority before which the proceeding is pending.
(2) During the
pendency of any such proceeding in respect of an industrial dispute, the
employer may, in accordance with the standing orders applicable to a workman
concerned in such dispute, -
(a) alter, in regard
to any matter not connected with the dispute, the conditions of service
applicable to that workman immediately before the commencement of such
proceeding, or
(b) for any misconduct
not connected with the dispute, discharge or punish, whether by dismissal or
otherwise :
Provided that no such
workman shall be discharged or dismissed, unless he has been paid wages for one
month and an application has been made by the employer to the authority before
which the proceeding is pending for approval of the action taken by the
employer.
(3) Notwithstanding
anything contained in sub-section (2) no employer shall during the pendency of
any such proceeding in respect of an industrial dispute, take any action
against any protected workman concerned in such dispute, -
(a) by altering, to
the prejudice of such protected workman, the conditions of service applicable
to him immediately before the commencement of such proceeding, or
(b) by discharging or
punishing, whether by dismissal or otherwise, such protected workman, such with
the express permission in writing of the authority before which the proceeding
is pending.
Explanation. - For the
purposes of this sub-section, a 'protected workman' in relation to an
establishment, means a workman who, being an officer of a registered trade
union connected with the establishment, is recognized as such in accordance
with rules made in this behalf.
(4) In every
establishment, the number of workmen to be recognized as protected workmen for
the purposes of sub-section (3) shall not exceed one per cent of the total
number of workmen employed therein subject to a minimum number of five
protected workmen and a maximum number of one hundred protected workmen and for
the aforesaid purpose, the State Government may make rules providing for the
distribution of such protected workmen among various trade unions, if any,
connected with the establishment and the manner in which they may be chosen and
recognized as protected workmen.
(5) Where an employer
makes an application to a Board, Labour Court or Tribunal under the proviso to
sub-section (2) for approval of the action taken by him, the authority
concerned shall, without delay, hear such application and pass, as
expeditiously as possible, such order in relation thereto as it deems fit.”
9.
On a plain reading of this section, we can deduce that any unilateral
alteration in service conditions, including termination, is
impermissible during the pendency of such proceedings unless prior
approval is obtained from the appropriate authority. The record in the present
case does not indicate that the Respondent Employer ever sought or was granted
the requisite approval. Prima facie, therefore, this conduct reflects a
deliberate attempt to circumvent the lawful claims of the workmen, particularly
when their dispute over regularization and wages remained sub judice.
10.
The Respondent Employer consistently labelled the Appellant Workmen as casual
employees (or workers engaged through an unnamed contractor), yet there is no
material proof of adherence to Section 6N of the U.P. Industrial
Disputes Act, 1947, which mandates a proper notice or wages in lieu thereof as
well as retrenchment compensation. In this context, whether an individual is
classified as regular or temporary is irrelevant as retrenchment obligations
under the Act must be met in all cases attracting Section 6N. Any termination
thus effected without statutory safeguards cannot be undertaken lightly.
11.
Furthermore, the Employer’s stance that there was never a direct
employer-employee relationship is wholly unsubstantiated. If, in fact, the
Appellant Workmen had been engaged solely through a contractor, the
Employer would have necessarily maintained some form of contract documentation,
license copies, or invoices substantiating the contractor’s role in hiring,
paying, and supervising these workers. However, no such documents have been
placed on record. Additionally, the Employer has failed to establish that wages
were ever paid by any entity other than its own Horticulture Department, which
strongly indicates direct control and supervision over the Workmen’s day-to-day
tasks is a hallmark of an employer-employee relationship. Had there been a
legitimate third-party contractor, one would expect to see details such as
tender notices, contract agreements, attendance records maintained by the contractor,
or testimony from the contractor’s representatives. The absence of these
crucial elements undermines the Employer’s claim of outsourced engagement. In
fact, it appears that the Workmen were reporting directly to the Horticulture
Department officials, receiving instructions on their duties, and drawing wages
issued under the Municipality’s authority. This pattern of direct oversight and
wage disbursement substantially negates the narrative that they were
“contractor’s personnel.” Consequently, the discontinuation of their services
carried out without compliance with statutory obligations pertaining to notice,
retrenchment compensation, or approval under Section 6E of the U.P.
Industrial Disputes Act, stands on precarious ground. The very foundation of
the Employer’s defense (i.e., lack of an employer- employee relationship) is
not supported by any credible or contemporaneous evidence.
12.
The evidence, including documentary material and undisputed facts, reveals that
the Appellant Workmen performed duties integral to the Respondent Employer’s
municipal functions specifically the upkeep of parks, horticultural tasks, and
city beautification efforts. Such work is evidently perennial rather than
sporadic or project-based. Reliance on a general “ban on fresh recruitment”
cannot be used to deny labor protections to long- serving workmen. On the
contrary, the acknowledged shortage of Gardeners in the Ghaziabad Nagar Nigam
reinforces the notion that these positions are essential and ongoing, not
intermittent.
13.
By requiring the same tasks (planting, pruning, general upkeep) from the
Appellant Workmen as from regular Gardeners but still compensating them
inadequately and inconsistently the Respondent Employer has effectively engaged
in an unfair labour practice. The principle of “equal pay for equal work,”
repeatedly emphasized by this Court, cannot be casually disregarded when
workers have served for extended periods in roles resembling those of permanent
employees. Long-standing assignments under the Employer’s direct supervision
belie any notion that these were mere short-term casual engagements.
14.
The Respondent Employer places reliance on Umadevi (supra) [(2006) 4 SCC 1.] to contend that
daily-wage or temporary employees cannot claim permanent absorption in the
absence of statutory rules providing such absorption. However, as frequently
reiterated, Uma Devi itself distinguishes between appointments that are
“illegal” and those that are “irregular,” the latter being eligible for
regularization if they meet certain conditions. More importantly, Uma Devi
cannot serve as a shield to justify exploitative engagements persisting for
years without the Employer undertaking legitimate recruitment. Given the record
which shows no true contractor- based arrangement and a consistent need for
permanent horticultural staff the alleged asserted ban on fresh recruitment,
though real, cannot justify indefinite daily-wage status or continued unfair
practices.
15.
It is manifest that the Appellant Workmen continuously rendered their services
over several years, sometimes spanning more than a decade. Even if certain
muster rolls were not produced in full, the Employer’s failure to furnish such
records—despite directions to do so—allows an adverse inference under
well-established labour jurisprudence. Indian labour law strongly disfavors
perpetual daily-wage or contractual engagements in circumstances where the work
is permanent in nature. Morally and legally, workers who fulfil ongoing
municipal requirements year after year cannot be dismissed summarily as
dispensable, particularly in the absence of a genuine contractor agreement. At
this juncture, it would be appropriate to recall the broader critique of
indefinite “temporary” employment practices as done by a recent judgement
of this court in Jaggo v. Union of India [2024
SCC OnLine SC 3826] in the following paragraphs:
“22. The pervasive
misuse of temporary employment contracts, as exemplified in this case, reflects
a broader systemic issue that adversely affects workers' rights and job
security. In the private sector, the rise of the gig economy has led to an
increase in precarious employment arrangements, often characterized by lack of
benefits, job security, and fair treatment. Such practices have been criticized
for exploiting workers and undermining labour standards. Government
institutions, entrusted with upholding the principles of fairness and justice,
bear an even greater responsibility to avoid such exploitative employment
practices. When public sector entities engage in misuse of temporary contracts,
it not only mirrors the detrimental trends observed in the gig economy but also
sets a concerning precedent that can erode public trust in governmental
operations.
………
25. It is a
disconcerting reality that temporary employees, particularly in government
institutions, often face multifaceted forms of exploitation. While the
foundational purpose of temporary contracts may have been to address short-term
or seasonal needs, they have increasingly become a mechanism to evade long-term
obligations owed to employees. These practices manifest in several ways:
• Misuse of
“Temporary” Labels: Employees engaged for work that is essential, recurring,
and integral to the functioning of an institution are often labelled as
“temporary” or “contractual,” even when their roles mirror those of regular
employees. Such misclassification deprives workers of the dignity, security,
and benefits that regular employees are entitled to, despite performing
identical tasks.
• Arbitrary
Termination: Temporary employees are frequently dismissed without cause or
notice, as seen in the present case. This practice undermines the principles of
natural justice and subjects workers to a state of constant insecurity,
regardless of the quality or duration of their service.
• Lack of Career
Progression: Temporary employees often find themselves excluded from
opportunities for skill development, promotions, or incremental pay raises.
They remain stagnant in their roles, creating a systemic disparity between them
and their regular counterparts, despite their contributions being equally
significant.
• Using Outsourcing as
a Shield: Institutions increasingly resort to outsourcing roles performed by
temporary employees, effectively replacing one set of exploited workers with
another. This practice not only perpetuates exploitation but also demonstrates
a deliberate effort to bypass the obligation to offer regular employment.
• Denial of Basic
Rights and Benefits: Temporary employees are often denied fundamental benefits
such as pension, provident fund, health insurance, and paid leave, even when
their tenure spans decades. This lack of social security subjects them and
their families to undue hardship, especially in cases of illness, retirement,
or unforeseen circumstances.”
16.
The High Court did acknowledge the Employer’s inability to justify these abrupt
terminations. Consequently, it ordered re-engagement on daily wages with some
measure of parity in minimum pay. Regrettably, this only perpetuated
precariousness: the Appellant Workmen were left in a marginally improved yet
still uncertain status. While the High Court recognized the importance of their
work and hinted at eventual regularization, it failed to afford them continuity
of service or meaningful back wages commensurate with the degree of statutory
violation evident on record.
17.
In light of these considerations, the Employer’s discontinuation of the
Appellant Workmen stands in violation of the most basic labour law principles.
Once it is established that their services were terminated without
adhering to Sections 6E and 6N of the U.P. Industrial
Disputes Act, 1947, and that they were engaged in essential, perennial duties,
these workers cannot be relegated to perpetual uncertainty. While concerns of
municipal budget and compliance with recruitment rules merit consideration,
such concerns do not absolve the Employer of statutory obligations or negate
equitable entitlements. Indeed, bureaucratic limitations cannot trump the
legitimate rights of workmen who have served continuously in de facto regular
roles for an extended period.
18.
The impugned order of the High Court, to the extent they confine the Appellant
Workmen to future daily-wage engagement without continuity or meaningful back
wages, is hereby set aside with the following directions:
I. The discontinuation
of the Appellant Workmen’s services, effected without compliance with Section
6E and Section 6N of the U.P. Industrial Disputes Act, 1947, is
declared illegal. All orders or communications terminating their services are
quashed. In consequence, the Appellant Workmen shall be treated as continuing
in service from the date of their termination, for all purposes, including
seniority and continuity in service.
II. The Respondent
Employer shall reinstate the Appellant Workmen in their respective posts (or
posts akin to the duties they previously performed) within four weeks from the
date of this judgment. Their entire period of absence (from the date of
termination until actual reinstatement) shall be counted for continuity of
service and all consequential benefits, such as seniority and eligibility for
promotions, if any.
III. Considering the
length of service, the Appellant Workmen shall be entitled to 50% of the back
wages from the date of their discontinuation until their actual reinstatement.
The Respondent Employer shall clear the aforesaid dues within three months from
the date of their reinstatement.
IV. The Respondent
Employer is directed to initiate a fair and transparent process for
regularizing the Appellant Workmen within six months from the date of
reinstatement, duly considering the fact that they have performed perennial
municipal duties akin to permanent posts. In assessing regularization, the
Employer shall not impose educational or procedural criteria retroactively if
such requirements were never applied to the Appellant Workmen or to
similarly situated regular employees in the past. To the extent that sanctioned
vacancies for such duties exist or are required, the Respondent Employer shall
expedite all necessary administrative processes to ensure these longtime
employees are not indefinitely retained on daily wages contrary to statutory
and equitable norms.
19.
In view of the above, the appeal(s) filed by the workmen are allowed, whereas
the appeal(s) filed by the Nagar Nigam Ghaziabad are dismissed.
20.
All pending applications stand disposed of. No orders as to costs.
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