CHANAKYA NATIONAL LAW UNIVERSITY
PAYMENT OF SUBSISTENCE ALLOWANCE UNDER STANDING ORDER ACT,1946 SUBMITTED BY:MD SHAIQUE ROLL NO:559 5TH SEMESTER SUBMITTED TO:DR.S.C RAO. 10/18/2013
.
ACKNOWLEDGEMENT The present project on the topic topic “PAYMENT OF SUBSISTENCE ALLOWANCE UNDER STANDING ORDER ACT,1946”
has been able to get its final shape with the
support and help of people from various quarters. My sincere thanks go to all the members without whom the study could not have come to its present state. I am proud to acknowledge gratitude to the individuals during my study st udy and without whom the study may not be completed. I have taken this opportunity opportunity to thank those those who genuinely helped me. In the completion of this project many people helped us directly and indirectly. First of all we would like to thank my university i.e. CHANAKYA NATIONAL LAW UNIVERSITY, PATNA, who gave us the idea and encouragement to venture into this project.
I am grateful to our faculty of Labour Law,Dr.S.C.ROY. who gave us the opportunity to make a project project on “PAYMENT “PAYMENT OF SUBSISTENCE ALLOWANCE UNDER STANDING ORDER ACT,1946”. ACT,1946” . Any sort of addition, alteration and criticism regarding our work is most welcome. I have made every effort to acknowledge credits, but I apologies in advance for any omission that may have inadvertently taken place. Last but not least I would like to thank Almighty whose blessing helped me to complete the project. MD.SHAIQUE 559 5THSEMESTER
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RESEARCH METHODOLOGY AIMS & OBJECTIVES: The aim of the project is to present a detailed study of “ PAYMENT OF SUBSISTENCE ALLOWANCE UNDER STANDING ORDER ACT,1946 ” through decisions and suggestions and different writings, articles & reports.
SOURCES OF DATA: The following secondary sources of data have been used in the projectArticles Books Websites
METHOD OF WRITING: The method of writing followed in the course of this research paper is primarily analytical.
MODE OF CITATION: The researcher has followed a uniform mode of citation throughout the course of this research paper.
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INDEX
1. Introduction…………………………………………………..……….……………04 2. Object of Standing Order Act……………………………………………………..05
3. Scope and application………………………………………………………………06
4. Important definitions & procedure…………………………………….…..….07-12
5. Subsistence allowance under Standing Order Act,1946……………………..13 -15
6. Judicial notion………………………………………………………………….16-17 a)Denial of subsistence allowance legal : HC……………………………………16 b)Supreme court directive of subsistence allowance to suspended employee ….17 7. Subsistence allowance under Corporate Law…………………...……….…..18 -20
8. Conclusion…………………………………………………………………………..21
9.
Bibliography………………………………………………………………………………22
INTRODUCTION 4|Page
The absence of standing orders in establishment very often led to friction between the management and workers in industrial undertakings in our country. Before passing of this Act the conditions of the employment were governed by contracts either express or implied between the employers and their employees in different industrial undertakings. In many cases these conditions were not well defined and suffered from doubt and ambiguity.
With the advent of trade unionism and collective bargaining new problems of maintaining industrial peace and production for the society were created. It was then considered that the society had a vital interest in the settlement of terms of employment of industrial labour and thus the settlement of labour problems became tripartite and the state, representing the society entered on the scene 1.
The importance of making a law defining precisely the conditions of employment was emphasized during discussions in the tripartite labour conferences. To give effect to the new ideology the industrial employment (standing orders)Act,1946 was enacted by the central government. It is obligatory upon all the employers covered by this Act to define conditions of employment under them. The conditions of employment must also be made known to workmen employed by such employers.
The preamble of the Act makes it amply clear that the standing order shall deal with the “condition of the employment of the workers in the industrial establishment”. These words are wide enough to include acts which may be commited even out of the factory premises2.The object of the act is to regulate the conditions of recruitment, discharge disciplinary action, holidays etc., of the workers employed in industrial undertakings.
OBJECT OF STANDING ORDER ACT 1 2
Western india match co. v.workmen,A.I.R. 1973 S.C. 2650. Shahadara s. light railway co. v. s.s. railway workers union, A.I.R. 1969 S.C. 51 3.
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The object of the Act is to "require the employers in industrial establishment to define with sufficient precision the conditions of empl oyment under them and to make the said conditions known to the workmen employed under them. The aims of the Act are as follows :
To define precisely the terms and conditions of employment and to communicate them to the workmen in the industrial establishments.
To bring about uniformity in the terms and conditions of employment in all industrial establishments to which the Act applies.
To regulate the standards of conduct of employers and to establish a basis for harmonious labour management relations.
To ensure satisfactory employment conditions and to maintain proper disciplinenecess ary for high productivity.
To specify the duties and responsibilities of both the employer and the employees
To provide redressal of grievances arising out of employment or unfair treatment by the employer.
To provide statutory sanctity and significance to the standing orders.
SCOPE AND APPLICATION 6|Page
The Act extends to the whole of India. It applies to every industrial establishment wherein 100 or more workmen are employed on any day of the preceding 12 months. The appropriate Government may also, after giving not less than 2months notice of its intention to do so, by notification in the Official Gazette, apply the provisions of the Act on any industrial establishment
employing
less
than
100
persons.
The appropriate government can also exempt conditionally or unconditionally anyindustrial establishment from all or any of the provisions of the Act Once the Act becomes applicable to an industrial establishment it does not cease to apply due to fall in the number of workmen in that establishment below 1003.
The Act does not apply to 4 : (1)Any industry to which the provisions of Chapter VII of the Bombay Industrial Relations Act 1946 apply; or (2)Any industrial establishment to which the provisions of Madhya Pradesh Industrial Employment (Standing Orders) Act 1961 apply. (3)Any industrial establishment in so far as the workmen employed therein are persons to whom the following rules apply : (a)The Fundamental and Supplementary Rule. (b)The Civil Services(Classification, Control and Appeal) Rules (c)The Civil Services (Temporary Services) Rules (d)The Revised Leave Rules. (e)The Civil Services Regulations. (f)The Civilians in Defence Service (Classification, Control and Appeal)Rules (g)The Indian Railway Establishment Code . (h)Any other rules and / or regulations that may be notified in this behalf bythe appropriate Government in the Official Gazette.
IMPORTANT DEFINITIONS Appellate Authority 3 4
http://www.citehr.com/43628-payment-subsistence-allowance.html Ibid.
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[Sec 2(a)] It means any authority appointed by the appropriate Government by notification in the official Gazette to exercise in such areas as may be notified in the function of an appellate authority under this Act. But in relation to an appeal pending before an industrial court or other
authority
immediately
before
the
commencement
of
the
Industrial
Employment(Standing Orders) Amendment Act 1965,the Court or authority shall be deemed to be the appellate authority.
Appropriate Government
[Sec 2(b)] It means in respect of industrial establishments under the control of the Central Government and a Railway Administration or in Major port, mine or oil field, the Central Government. In all other cases it means the State Government. Where any question as to whether any establishment is under the control of
the Central Government, that Government may after giving the parties an opportunity of being heard, decide the question and such decision shall be final and binding on all parties.
Certifying Officer
[Sec 2©] It means a Labour Commissioner or a Regional Labour Commissioner and includes any other officer appointed by the appropriate Government, by notification in the Official Gazette, to perform all or any of the functions of a certifying officer under the Act.
Employer
[Sec 2 (d)] It means the owner of an industrial establishment to which the Act for the time being applies and includes :(i)in a factor y any person named under Sec 7( 1) of the Factories Act 1948, as manager of the factory;(ii) in any industrial establishment under the control of any department of any department of the Government of India, the authority appointed by such government on this behalf, or where no authority is so appointed the head of the department(iii) in any other industrial establishment, any person responsible to the owner for the supervision and control of the industrial establishment.
Industrial Establishment
[Sec 2(e)] It means : (j)a n i ndust rial esta blis hment as defin ed in Sec 2(ii ) o f t he Pa ym en t of Wa ge Act 1936.(ii) a factory as defined in Sec 2 (m) of the Factories Act 8|Page
1948(iii) a railway as defined in Sec 2(4) of the Indian Railways Act 1890.(iv) establishment of a person who, for the purpose of fulfilling a contract with the owner of any industrial establishment employs workmen.
Standing Orders
The Central Government, that Government may after giving the parties an opportunity of being heard, decide the question and such decision shall be final and binding on all parties.
Certifying Officer
[Sec 2©] It means a Labour Commissioner or a Regional Labour Commissioner and includes any other officer appointed by the appropriate Government, by notification in the Official Gazette, to perform all or any of the functions of a certifying officer under the Act.
Employer
[Sec 2 (d)] It means the owner of an industrial establishment to which the Act for the time being applies and includes :(i)in a factor y any person named under Sec 7( 1) of the Factories Act 1948, as manager of the factory;(ii) in any industrial establishment under the control of any department of any department of the Government of India, the authority appointed by such government on this behalf, or where no authority is so appointed the head of the department(iii) in any other industrial establishment, any person responsible to the owner for the supervision and control of the industrial establishment.
Industrial Establishment
[Sec 2(e)] It means : (j)a n i ndust rial esta blis hment as defin ed in Sec 2(ii ) o f t he Pa ym en t of Wage Act 1936.(ii) a factory as defined in Sec 2 (m) of the Factories Act 1948(iii) a railway as defined in Sec 2(4) of the Indian Railways Act 1890.(iv) establishment of a person who, for the purpose of fulfilling a contract with the owner of any industrial establishment employs workmen.
Standing Orders
[Sec 2 (g)] These imply rules relating to matters set in the Schedule to the Act.
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THE SCHEDULE
[Secs 2 (g) and 3 (2)]
Maters to be Provided in Standing Orders
1.Classification of workmen, e.g., whether permanent, temporary, apprentices, probationers or badlis. 2.Manner of intimating to workmen periods and hours of work, holidays, pay-days Wage rules .3.Shift working. 4.Attendance and late coming. 5.Conditions of procedure in applying for, and authority which may grant leave or holidays. 6.Requirement to enter premises by certain gates and liability to search. 7.Closing and reopening of sections of industrial establishment, temporary stoppages of work and rights and liabilities of the employer and the workman arising there from. 8.Termination of employment, and the notice thereof to be given by employer and workmen. 9.Suspension and dismissal for misconduct and acts or omissions which contribute to misconduct 10.Means of redress of workmen against unfair treat ment or wrongful extractions by the employer or his agents or servants. 11.Any other matter which may be prescribed.
Workmen
[Sec 2(i)] „Workmen‟ means any person (including any apprentice) employed in any industrial employment to any skilled, or unskilled, manual, supervisory, technical or clerical work for hire or reward, whether the terms of employment be express or implied, but does not include any such person : (i)Who is subject to Army Act, 1950 or Air Force Act 1950, or the Navy Act 1957 (ii) Who is employed in the police service or as an officer or other employee of a person (iii)Who is employed mainly in a managerial or administrative capacity (iv)Who being employed in a supervisory capacity draws wages exceeding Rs 3000 per men. (v)Who exercises, either either by the nature of the duties attached to the office or by reason of power invested in him, functions mainly of a managerial nature.
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Procedure for Submission of Draft Standing Orders (Sec 3)(1) With six months of the application of this Act to an industrial establishment the
employer shall submit to the certifying officer 5 copies of the draft standing orders proposed by him for adoption in his industrial establishment. (2)Such draft standing order shall cover every matter set out in the Schedule to the Act which may be applicable to the industrial establishment. (3)Where model standing orders have been prescribed, the draft standing order shall be so far as practicable, in conformity with such model. (4)The draft standing orders submitted shall be accompanied by a statement giving prescribed particulars of the workmen employed in the industrial employment. They shall also give the nature of the trade union if any, to which the workmen belong. (5)Subject to such conditions as may be prescribed, a group of employers in a similar industrial establishment may submit a joint draft of standing orders5.
Matters to be provided in Standing Orders
(The Schedule) : The Schedule to the Act specifies the following matters to be provided in the Standing orders 6 :
Classification of workmen eg whether permanent, temporary, apprentices, probationers,
or
Badlis. Manner of intimating workmen periods and hours of work, holidays, paydays, and wage rates. Shift working Attendance and late coming, Conditions of, procedure in applying for, and the authority which may grant leave and holidays. Requirement to enter premises by certain gates and liability to search. Closing and reopening of sections of the industrial establishment, temporary stoppages of work, and the rights and liabilities of the employer and workmen arising there from. Termination of employment and notice thereof to be given by employer to workmen.
5 6
http://www.citehr.com/195531-applicable-deduction-subsistence-allowance.html Ibid.
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Suspension and Dismissal for misconduct and acts and omissions which constitute misconduct. Means of redress for workmen against unfair treatment or wrongful exaction by the employer or his agents or servants. Any other matter which may be prescribed. There is no bar to the Standing Orders making provisions for other matters. Once such provisions are made they are liable to be modified on the motion of either the employer or the workmen under Sec 10(2) of this Act.
Conditions for Certification of Standing Orders
[Sec4]Standing
Orders
are
to
be
certified
under
this
Act
if
:(a)provision is made therein for every matter set outin the schedule which is applicable for industrial establishment (b)The Standing Orders are otherwise in conformity with the provisions of this Act. It is the function
of
the
certifying
officer
or
appellate
authority
to
adjucate
upon
the
reasonableness or fairness of the provisions of any standing orders. However their Judgement must not be arbitrary or perverse or inconsistent with the provisions of the Act. If no provision is made for anything set out in the schedule the certifying officer can add to the draft standing orders. He can amend the draft standing orders where the language used does not define with sufficient precision the conditions of employment7.
Procedure for Certification of Standing Orders
[Sec 5]The procedure for certification of standing orders is as follows : (1)On receipt of the draft standing orders, the certifying officer forwards a copy thereof to the trade union, or where there is no trade union to the workmen in a prescribed manner. (2)He also sends with the copy of the draft a notice in the prescribed form requiring objections if any, which the workmen may desire to make to the draft standing orders. (3)The objections are to be submitted to him within 15 days from date of the receipt of the notice.
7
The aluminium Industries employees‟ union v. Aluminium Industries Ltd., A.I.R. 1963 Orissa 169.
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(4)He is required to give opportunity to the employer or the trade union or such other representatives or the workmen as may be prescribed of being heard if any modifications or addition to the standing order is to be made 8. (5)After the certifying officer then decides whether or not any modification of or addition to the draft submitted by the employer is necessary to render the draft standing orders certifiable under this Act and then makes orders in writing accordingly 9. (6)The Certifying officer then certifies the draft standing orders with themodifications if any. He then within 7 days sends copies of the certified standing orders and of his order to the employer, to the trade union or other prescribed representatives of workmen. (7)The standing orders after their due certification then applies to all workmen employed in an industrial establishment before or after such certification10.
8
9
Salem Erode Electricity Distribution Company(Pvt.) v. Employees‟union, A.I.R. 1966 S.C. 808. http://www.citehr.com/216325-subsistence-allowance.html Ibid.
10
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SUBSISTENCE ALLOWANCE UNDER STANDING ORDER ACT,1946. (10-A) Payment of subsistence allowance.
(1) Where any workman is suspended by the employer pending investigation or inquiry into complaints or charges of misconduct against him, the employer shall pay to such workman subsistence allowance. At the rate of fifty percent of the wages which the workman was entitled to immediately preceding the date of such suspension, for the first ninety days of suspension ; and At the rate of seventy-five per cent. of such wages for the remaining period of suspension if the delay in the completion of disciplinary proceedings against such workman is not directly attributable to the conduct of such workman.
(2) If any dispute arises regarding the subsistence allowance payable to a workman under subsection (1), the workman or the employer concerned may refer the dispute to the Labour Court constituted under the Industrial Disputes Act, 1947 (14 of 1947) within the local limits of whose jurisdiction the industrial establishment wherein such workman is employed is situate and the Labour Court to which the dispute is so referred shall, after giving the parties an opportunity of being heard, decide the dispute and such decision shall be final and binding on the parties. (3) Notwithstanding anything contained in the foregoing provisions of this section, where provisions relating to payment of subsistence allowance under any other law for the time being in force in any State are more beneficial than the provisions of this section, the provisions of such other law shall be applicable to the payment of subsistence allowance in that State11.
In Kalyanpur Keshav Venkatarai Pai v. Corporation Bank 12, the petitioner was manager of corporation bank, kalbadevi branch ,Bombay. The petitioner claimed subsistence allowance based on Bombay shops and establishments act,1948 and the standing orders act,1946. The standing orders Act and rules were mutatis mutandis made applicable for the purpose of subsistence allowance to the employees of the establishments governed by the shops act.
11
http://www.vakilno1.com/bareacts/industrialemploymentact/s10a.htm (2002) III L.L.J. 122 (Cal.).
12
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It was held that the standing orders act and rules framed there under. Employees who are not workman as above will not be covered by section 38-B of the Bombay shops and establishments act,1948. By applying the rule of harmonious construction, it is clear that legislature could not have intended to confer on managerial employees the benefits if benevolent provisions meant primarily to protect „workman‟. Since manager of a bank is not a workman he can not claim subsistence allowance.
In R. Govendaraj and others v. Govt. Tool Room and Training Centre 13, the petitioner who were employees of the respondent were suspended for certain charges pending domestic inquiry. In the petitioners were found guilty of the charges for which punishment by way of reduction was imposed and they were reinstalled in service. The employer order for recovery of subsistence allowance paid to them. This order was challenged in this petition. The concerned establishment provides that the employees found guilty shall be absent from duty for the suspension period and shall not be entitled to any remuneration. The Karnataka high court held that the rule meant that where an employee is exonerated he will be entitled for full salary and allowances which he would have drawn had he not been placed under suspension. The rule does not say that subsistence allowance paid the constitution. The standing order can not be interpreted in such a manner as to come in conflict with the provisions of the constitution. Further such construction would be violative of sction 10-A of the Act.
It was held in Transport Manager v. Vilas sanu deokar and others 14, that if an employer does not provide work to a badli workman by issuing no duty order, it would not amount to suspension from work. A person can be suspended from provided there is a vested right in the workman to secure work from the employer everyday while the contract of employment subsists. However,in the case of a badli workman, the contract of employment comes into effect only on the day he is given employment, and therefore, the question of suspension from work on account of a „no duty order‟ does not arise. A badli workman is one who perform his duty as and when work is made available to him by the employer. If there can be suspension from work of a badli workman, the question of being entitled to subsistence allowance during the period he is not allotted work does not arise.
13 14
(1988) I L.L.J. 244 (Bombay). (1990) I l.l.j. 140 (Karn.).
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A subsistence allowance is intended to cover the expenses incurred by an interpreter working away from his/her professional address. It may consist of a flat-rate amount paid per day or may involve an arrangement whereby the conference organiser pays all or part of the interpreter's accommodation and board. In the agreement sector, these allowances are governed by the relevant agreement. In the private market sector, they are negotiated between the interpreter and the client. Workman who is placed under suspension shall during the period of such suspension be paid a subsistence allowance at the following rates namely15. For the first ninety days of the suspension period subsistence allowance to be paid per month shall be equal to one-half of basic wages, dearness allowance and other compensatory allowances. If the enquiry gets prolonged and the workman continues to be under suspension for a period exceeding ninety days, the subsistence allowance to be paid per month for a further period of ninety days shall be equal to three fourths of such basic wages, dearness allowance and other compensatory allowances. If the enquiry is not completed within a period for 180 days, the workman shall be paid basic wages, dearness allowance and compensatory allowance in full as subsistence allowance to be paid per month until such time as the inquiry is finally concluded. Provided that, where the findings of the Inquiry Officer show that such enquiry is prolonged beyond a period of 90 days, or as the case may be 180 days for reasons directly attributable to the workman, subsistence allowance to be paid per months shall for the period exceeding 90 days or as the case may be 180 days, shall be reduced to one half of such basic wages, dearness allowance and other compensatory allowance. The age for retirement or superannuation of the workman may be sixty years or such other age as may be agreed upon between the employer and the workman by any agreement, settlement or award which may be binding on the employer and the workmen under any law for the time being in force 16.
15
http://www.citehr.com/195531-applicable-deduction-subsistence-allowance.html C.M. Ptel v. State, A.I.R. 1971 Bom. 244.
16
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JUDICIAL NOTION DENIAL OF SUBSISTENCE ALLOWANCE LEGAL : HC Allahabad: A division bench allahabad high court has ruled that denial of payment of
subsistence allowance to a suspended employee if he fails to submit a certificate, under subrule (1) and (2) of rule 53 of the up fundamental and subsidiary rules that he is not engaged in any other employment, business, profession or vocation, is legal. chief justice s k sen and justice r k agrawal in a judgment has ruled that non-submission of the certificate by the appellant is his own folly and he cannot take advantage of it. the special appeal bench, has turned down the plea of the appellant that his dismissal from service is illegal and should to be quashed on the ground that he could not participate in the department proceedings, due to non-payment of subsistence allowance, during his suspension period. the bench, dismissed the appellants appeal, filed against the order of the single judge, on the ground that the appellant had failed to submit certificate required for getting subsistence allowance and he had not pleaded either before the departmental authorities or in the petition that due to non payment of subsistence allowance, he could not participate in the proceedings and consequently he was terminated from service without following the principles of natural justice. the brief fact of the case was that the appellant s d gupta was working as a clerk in nagar palika bindki in fatehpur. he was suspended on may 19, 1988, during departmental proceeding. the charges against the appellants were of indiscipline and irregularities causing financial loss to the municipal board. ultimately he was terminated on november 8 after completing the departmental proceedings. the petitioner had challenged the order of his termination before a single judge of the high court, which was dismissed. the appellant thereafter challenged the order of single judge in a special appeal. the bench upheld the order of the single judge and dismissed the appeal 17.
17
http://www.lawyersclubindia.com/experts/Subsistence-allowance-281166.asp
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SUPREME COURT DIRECTIVE OF SUBSISTENCE ALLOWANCE TO SUSPENDED EMLOYEES New Delhi: The Supreme Court has ruled that a government employee under suspension is not entitled to subsistence allowance on the basis of a revised pay scale if the disciplinary action against him or her has been taken before the revision. A bench of Justices R V Raveendran and K S Radhakrishnan in a judgement said the suspended employee is entitled to subsistence allowance on the basis of a revised pay scale if the suspension had taken after the revision. Interpreting rule Note 3 to Rule 7 of the Revised Pay Rules and FR 53(1)(ii)(a) and Office Memorandum dated 27th August, 1958 of the Union of India, the apex court said the rule is clear that if the revision of pay takes effect from a date prior to the date of suspension of a government servant then he/she would be entitled to benefit of increment in pay and in the subsistence allowance for the period of suspension. "But if the revision of scale of pay takes effect from a date falling within the period of suspension then the benefit of revision of pay and the subsistence allowances will accrue to him only after reinstatement depending on the fact whether the period of suspension is treated as duty or not," Justice Radhakrishnan writing the judgement said. The apex court passed the judgement while upholding an appeal filed by the Centre challenging the directions passed by the Central Administrative Tribunal and the Delhi High Court to pay subsistence allowance to R K Chopa, a suspended employee of the Ministry of Commerce and Industries18.
18
http://zeenews.india.com/news/nation/sc-directive-on-subsistence-allowance-to-suspended-staff_601301.html
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SUBSISTENCE ALLOWANCE UNDER CORPORATE LAW The Industrial Disputes Act, 1947 [“IDA”], provides for an elaborate system of adjudication of disputes between employers and workmen, and litigation over “subsistence allowance” is by no means uncommon, not only for tactical reasons, but also because it is often the only means of survival for an employee facing disciplinary proceedings. In this context, a single judge of the Bombay High Court has advanced an interesting proposition of law, in a careful judgment delivered a few weeks ago in Mumbai Cricket Association v Shinde19. Mr. Shinde had been employed as a typist by the MCA, and was chargesheeted under the Model Standing Orders for accepting an illegal gratification. Following an inquiry, the charges were found proved, and he was dismissed on 25 November, 2002. Mr. Shinde sought and obtained a reference from the appropriate Government, and challenged his dismissal before the Labour Court. As is well known, the dispute resolution mechanism in s. 10 of the IDA is activated only upon a reference by the appropriate Government. The Labour Court found that the inquiry was “perverse” but gave the employer an opportunity to prove the charges in court by adducing evidence. Again, this practice is widely followed in industrial adjudication to avoid unnecessary delay in remitting the case back for an inquiry, following which there is inevitably another reference to the Court on the same facts. At this stage, Mr. Shinde sought an order for “subsistence allowance” in accordance with s. 10A of the Industrial Employment (Standing Orders) Act 1946 [“IESO”], which provides that an employer is obliged to pay the employee a specified percentage of his wages during his suspension and pending the result of the inquiry20. The obvious difficulty Mr. Shinde faced was that the order of the Labour Court permitting the employer to prove the charges was technically not an “inquiry” and he could not be said have been “suspended”, since the order of dismissal had not formally been set aside. Nevertheless, the Labour Court took the view that this was akin to an inquiry, that “equity” demanded the payment of subsistence allowance and so ordered. The question of law before the single judge was whether this is a correct construction of the IDA and the IESA. It is convenient to begin by setting out the operative part of s. 10A IESA:
19
http://indiacorplaw.blogspot.in/2011/02/subsistence-allowance-during.html Ibid.
20
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10-A. Payment of subsistence allowance.-(1) Where any workman is suspended by the employer pending investigation or inquiry into complaints or charges of misconduct against him, the employer shall pay to such workman subsistence allowance… Dharmadhikari J., for two reasons, held that this provision is irrelevant in circumstances where the Labour court directs the employer to prove the charges of a “perverse” inquiry in court. First , there is authority for the proposition that the order of dismissal is not set aside by the direction of the Labour court to adduce fresh evidence – indeed, if the Labour court affirms the dismissal on appreciating evidence, the order “relates back” to the date of dismissal. If this is true, it must inevitably follow that s. 10A is unavailable, because the workman cannot on any view be “suspended” when his “dismissal” order is effective, albe it in abeyance. To support this proposition, Dharmadhikari J. turned to the decision in Engineering Laghu v Labour Court 21, where the Supreme Court had held that the dismissal order remains valid “until it is set aside” and therefore, if confirmed, must be given effect not from the date of the judgment, but from the date of the passing of the dismissal order. It was argued in that case that there is a distinction at any rate between cases where an employee is dismissed without an inquiry, and those where dismissal follows an inquiry that is found to be defective. The contention was that the dismissal is “void” in the first case, and therefore takes effect only from the date of judgment. Krishna Iyer J. had accepted this view but was overruled in Engineering Laghu, because of settled authority that the doctrine of relating back applies in both cases. Dharmadhikari J. therefore rightly observed that: The order of dismissal remains and is not set aside. If upheld by the Court, it will be after the order of the Court in that behalf. However, it relates back to the date of punishment. If what is postponed is its coming into effect or operation, then, the argument of Mr. Pathak that it is held in abeyance must be straightway rejected. His argument would render doctrine of relation back completely nugatory. The second reason is as compelling – even on the assumption that the employee may be said to be “suspended” for the purposes of s. 10A, it must still be established that he is suspended “ pending investigation or inquiry into complaints or charges of misconduct…” The fact that the Labour Court, when no inquiry has been conducted, is entitled to hear all the evidence
21
A.I.R. 2004 S.C. 4951.
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and make findings of fact and law, cannot elide an “inquiry or investigation” and an adjudication. As Dharmadhikari J. noted, The employee sought a reference from the Appropriate Government and that is how the matter of his dismissal is referred to the Labour Court and that is how the Court is seized of the matter. The Court cannot be equated with an employer as it is only performing a judicial function of giving an opportunity to the petitioner to adduce evidence to prove charges of misconduct before it, and that is because the law postulates such an opportunity. The law does not equate this situation with suspension by the employer pending domestic enquiry or investigation into any complaints [emphasis mine]. The final argument advanced was that the Court is nevertheless entitled to award subsistence allowance as a matter of “justice, equity and good conscience” bearing in mind the impecunious condition of the employee and his stated inability to sustain himself during the pendency of the proceedings. Dharmadhikari J. emphatically rejected this contention, observing that the Labour court is not empowered to grant subsistence allowance “on specious grounds of equity and justice,” and that writ jurisdiction under Art. 226 of the Constitution cannot be exercised “contrary to law”. “Ultimately, equity and justice require that legal principles are adhered to and not given a go-by completely.” There was some doubt over whether this was contrary to the decision of a Division Bench of the Bombay High Court in Air India, but Dharmadhikari J. held that it was not, because that case was decided under s. 33 IDA, not s. 10. Since, however, the observations of the Division Bench were broad in that case, it remains to be seen whether the single judge‟s view will be affirmed22. In sum, it is submitted that Dharmadhikari J.‟s conclusion is plainly correct as a matter of statutory interpretation – indeed, it would be odd to accept the proposition that a dismissed employee is also a “suspended” employee, and that adjudication of the legality of dismissal is in fact an “investigation or inquiry” to ascertain whether dismissal is ap propriate. That does not, of course, mean that this is a desirable state of affairs, but if the view is taken that the benefit of subsistence allowance must extend to confirmatory proceedings in the Labour Court, that is perhaps best left to the legislature.
22
Tata Chemicals Ltd. V. K.C. Acharya, A.I.R. 1964 Guj. 265.
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CONCLUSION A subsistence allowance is intended to cover the expenses incurred by an i nterpreter working away from his/her professional address. It may consist of a flat-rate amount paid per day or may involve an arrangement whereby the conference organiser pays all or part of the interpreter's accommodation and board. In the agreement sector, these allowances are governed by the relevant agreement. In the private market sector, they are negotiated between the interpreter and the client. Workman who is placed under suspension shall during the period of such suspension be paid a subsistence allowance at the following rates namely23. For the first ninety days of the suspension period subsistence allowance to be paid per month shall be equal to one-half of basic wages, dearness allowance and other compensatory allowances. If the enquiry gets prolonged and the workman continues to be under suspension for a period exceeding ninety days, the subsistence allowance to be paid per month for a further period of ninety days shall be equal to three fourths of such basic wages, dearness allowance and other compensatory allowances. If the enquiry is not completed within a period for 180 days, the workman shall be paid basic wages, dearness allowance and compensatory allowance in full as subsistence allowance to be paid per month until such time as the inquiry is finally concluded. Provided that, where the findings of the Inquiry Officer show that such enquiry is prolonged beyond a period of 90 days, or as the case may be 180 days for reasons directly attributable to the workman, subsistence allowance to be paid per months shall for the period exceeding 90 days or as the case may be 180 days, shall be reduced to one half of such basic wages, dearness allowance and other compensatory allowance. The age for retirement or superannuation of the workman may be sixty years or such other age as may be agreed upon between the employer and the workman by any agreement, settlement or award which may be binding on the employer and the workmen under any law for the time being in force 24.
23 24
Sri Gopal Mills Ltd. V. State of Punjab, (1959) I llj 639. C.S. Corpn.v. Ramratan Mahato, A.I.R. 1973 Cal. 258.
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BIBLIOGRAPHY BOOKS
1. S.N . Mishra ,labour and industrial laws,23 rd ed.,2007,central law agency,Allahabad 2. V.G Goswami,Labour and industrial laws, 8 th ed.,2004,hon'ble justice Mahavir singh Central law agency Allahabad. 3. Cases and publication , Labour & Industrial laws,3 rd ed. Indian law institute , New Delhi. 4. .Workmen‟s Compensation Act – Some Reflections,Binod Kumar Patro, Chittaranjan Behera, Ramesh K. Sharma,Vol. 1, No. 1 (2007-07 - 2007-12) 5. Commentaries on the workmen compensation Act, K.D. Shrivastava, 1 st, 1985, Eastern Book Company.
ARTICLES:-
1. Work Injury Compensation and the Duration of Nonwork Spells ,The Economic Journal , Vol. 95, No. 379 (Sep., 1985), pp. 714-724 2.You are not what you were - Ashok Mitra after 14th November, 2007 3. Worker's Compensation - Know Your Rights, By Aaron Larson ,Law Offices of Aaron Larson, July, 2003 EXTERNAL LINKS WEBSITES:www.google.com www.wikipedia.com www.amzon.com www.legalserviceindia.com www.indiainfoline.com WWW.TIMESOFINDIA.COM WWW.THEHINDU.COM
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