Retrenched staff get relief from SC, 23 years after launching legal battle

The company had 150 employees of whom 98 were given a retrenchment notice on July 27, 1992 with a deadline of August 4, 1992. The employees were told that a decision was made to “rationalise activities” due to losses.

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The employees then moved the Industrial Court, alleging unfair trade practices and non-compliance with the Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act, 1971.

The Industrial Court held that the company had indeed committed unfair labour practices and said that it was unjust on the company’s part not to comply with the “last come first go” principle under the provisions of the Industrial Disputes Act.

The company challenged the order of the Industrial Court in 1996, first before a single judge of the Bombay High Court and then before a division bench. The division bench reaffirmed the findings of the reasons recorded in favour of the workmen and affirmed the award of the Industrial Court in its judgment.

Mackinnon Mackenzie then moved the Supreme Court contending that the notice was a result of “severe recession in the dominant areas of the industry”, and owing to other factors having a direct bearing on their business activities, it had to shut down some activities.

The apex court, however, observed that neither did the company serve the notice a month prior to the laying off nor did the company offer a month’s salary as compensation in lieu of the notice.

The principle of “last come first go” should have been strictly adhered to by the company at the time of issuing retrenchment notice, the SC said pointing out that it had retained seven employees who were “undisputedly juniors” to the concerned workmen in one of the departments. “Further, no category wise seniority list of the workmen was displayed on notice board of the appellant-Company as required in law,” the SC said.

“Since, the concerned workmen have been litigating the matter for the last 23 years, it would be appropriate for us to give direction to the appellant-Company to comply with the terms and conditions of the award passed by the Industrial Court by computing back-wages on the basis of revision of pay scales of the concerned workmen and other consequential monetary benefits including terminal benefits and pay the same to the workmen within six weeks from the date of receipt of the copy of this Judgment, failing which, the back-wages shall be paid with an interest at the rate of 9 per cent per annum,” ordered Justices V Gopala Gowda and C Nagappan.

One of the litigating employees, Chandrakant Ambolkar, who was a typist when he given the notice, told The Indian Express that 26 of the retrenched workers had passed away during this period. “Some resorted to driving autorickshaws and lived in sheer penury. The SC judgment has given a new lease of hope. It has been a tiring wait but nonetheless we can hope to rebuild a future for our families,” he said.

aamir.khan@expressindia.com