Suresh Manilal Shaha vs Kothari Industrial Corporation ...
2002 Latest Caselaw 1291 Bom

JUDGMENT

Nishita Mhatre, J.

1. By this petition, the petitioner impugns the order of the Industrial Court in complaint (ULP) No. 76 of 1985. The Complaint was filed by the Investigating Officer appointed under the Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act, 1971 (hereinafter referred to as 'MRTU & PULP Act').

2. On the basis of certain complaints received by the Investigating Officer, the Investigating Officer conducted an enquiry into the grievances of the employees of Respondent No. 1 working in a branch office at Kolhapur. According to the report of the Investigating Officer, the employees of the Kolhapur branch office were not being given the same service conditions as were available to the employees of the Head Office at Chennai. The Investigating Officer found that that the employees at Chennai Head Office were being paid salary including Dearness Allowance and other allowances on the basis of a settlement signed with the Union functioning in the establishment at Chennai Head Office of Respondent No. 1.

3. After hearing the Manager of the Kolhapur Branch Office and the employees concerned, the Investigating Officer found that the settlement applicable to the employees at Chennai Head Office covered the service conditions of clerks, typists and peons and though the employees were employed in similar categories in Kolhapur were not being paid the same wages and were not extended the service benefits available to the staff at Chennai establishment despite the fact that they were doing work of a similar nature.

4. This report of the Investigating Officer was treated as complaint under Items 5, 9 and 10 of Schedule IV of the MRTU & PULP Act. The petitioner, who was employed in the Kolhapur Branch Office, filed an application to be added as party complainant before the Industrial Court. This application was rejected by the Industrial Court on 13-8-1986 since the complaint was filed by the Investigating Officer who would represent the interest of the employees working in the Kolhapur Branch Office.

5. After evidence was led, the Industrial Court came to the conclusion that the complaint was maintainable. On merits, the Industrial Court found that the settlement dated 22-12-1982, which governed the service conditions of the employees of Chennai establishment, was signed under Section 2(p) r/w Section 18(1) of the Industrial Disputes Act and, therefore, the settlement per se would not be applicable to the employees of the Kolhapur Branch Office. The Industrial Court further came to the conclusion that since the Kolhapur Branch Office employees were not the parties to the settlement, they could not claim the benefits of the same as a matter of right and opined that the employees should move the Government in Reference under the Industrial Disputes Act. The Industrial Court was further of the view that the pleadings were not sufficient to prove any unfair labour practice under Items 5, 9 and 10 of Schedule IV of the MRTU & PULP Act on the part of employer and, therefore, dismissed the complaint.

6. It is against this order that the petitioner, who had filed an application for being impleaded as party, has moved the present petition under Articles 226 and 227 of the Constitution of India.

7. Mr. Bapat, learned Advocate for the petitioner, submitted that the provisions of Item 5 of Schedule IV of the MRTU & PULP Act were based on the principle envisaged by Article 14 of the Constitution of India and, therefore, submitted that the employees at Kolhapur Branch Office, who were in fact working as clerks, typists and peons, were entitled to the same benefits as that of the similarly situated employees doing the same nature of work at Chennai establishment. He submitted that Item 5 of Schedule IV of the MRTU & PULP Act was wide enough to cover an unfair labour practice committed by an employer by discriminating the employees employed in one establishment in a particular geographical area and another. He further submitted that although this was only a Branch Office, the discrimination between the employees employed in this establishment and those employed in the Head Office at Chennai would permit the Industrial Court to declare an unfair labour practice under Item 5 of Schedule IV of the MRTU & PULP Act as, according to the learned Advocate, the MRTU & PULP Act is not a toothless enactment and the Industrial Court acting under it is not rendered helpless after coming to the conclusion that there is an unfair labour practice.

8. He further submitted that Section 30 gave the Industrial Court ample powers to declare an unfair labour practice as also to give consequential reliefs of compensation to the party aggrieved. On a query from the Court, he submitted that the essential discrimination practiced by Respondent No. 1 is that the Dearness Allowance being paid to the employees of Kolhapur Branch Office was only a fixed Dearness Allowance whereas those at the Head Office at Chennai were being paid not only a higher fixed Dearness Allowance but also a variable Dearness Allowance based on the cost of living index at Chennai. The other reason, according to the learned Advocate, there was discrimination is because the monthly wages in Kolhapur Branch Office were being paid on the basis of 26 working days per month whereas the employees at the Head Office at Chennai worked for only 20 days in a month and were being paid at a higher rate. He, therefore, submitted that the difference in the Dearness Allowance is what the employees at Kolhapur would be entitled to as also the higher rate of salaries on account of being forced to work for more than 20 days in a month.

9. The learned Advocate relied on the judgments of the Apex Court in the cases of Randhir Singh v. Union of India and Ors. and Alvaro Noronha Ferriera and Anr. v. Union of India and Ors. in support of his contention that there cannot be two sets of service conditions for persons doing similar nature of work as there has to be a parity in employment on account of principle of 'equal pay for equal work'.

10. On the other hand, Mrs. Doshi, learned Advocate for respondent No. 1, submitted that the principles governing assessment of facts where Article 14 of the Constitution of India was breached on different grounds are those governing Item 5 of Schedule IV of the MRTU & PULP Act. She further submitted that the MRTU & PULP Act, which is applicable only in the State of Maharashtra, governs a particular establishment and does not have an omnibus provision governing all establishments of an employer. She submitted that 'undertaking' as defined in the Act is limited to a particular concern, of the Industry for the purposes of Chapter III. She urges that in any event, what is required to be seen under Chapter VI of the Act is whether an unfair labour practice has been committed in respect of a particular 'concern' or 'undertaking' or 'establishment' of the Industry. She also submitted that the agreement signed in Chennai Head Office was a settlement signed under Section 2(p) r/w Section 18(1) and would bind and govern only those employees who were working in the Head Office at Chennai and who were party to the settlements either individually or through their trade union. The petitioner not being a party to the settlement, could not claim benefits of that settlement by invoking the doctrine of "equal pay for equal work" in a complaint filed under the MRTU & PULP Act.

11. Mrs. Doshi relied on the judgments of the Apex Court in the case of Workmen employed by Indian Oxygen Ltd. v. Indian Oxygen Ltd. reported in 7955 II LLN 262 in support of her contention that the rates of Dearness Allowance in two different places would have to be different in view of the cost of living index of a particular centre which has a local flavour and although the employees might have been doing work of a similar nature in the two disparate establishments, the employees aggrieved could not claim the difference. She further relied on the judgment of The Monthly Rated Workmen at the Wadala Factory of the Indian Hume Pipe Co. Ltd v. Indian Hume Pipe Co. Ltd., Bombay reported in 1986 (Supp.) SCC 79 to submit that the Apex Court has deprecated the practice of wages being fixed contrary to the principles of industry-cum-region.

12. The basic issue before me is whether there can be an unfair labour practice on account of breach of the provisions of Item 5 of Schedule IV of the MRTU & PULP Act between the workers of two different establishments. Item 5 of Schedule IV stipulates that it is an unfair labour practice to show favouritism or partiality to one set of employees regardless of merits. Obviously, this means that the employees must be working within the same establishment and not in any other establishment, although the employer may be the same. The employees in the Kolhapur Branch Office cannot claim that there has been a violation of Item 5 of Schedule IV of the MRTU & PULP Act on account of the employer not extending the benefits of the settlement dated 22-12-1982 signed between the employees working at the Chennai Head Office. This is because the settlement itself covers only the 200 employees of the Chennai Head Office consisting of subordinate staff. The settlement has been signed by Respondent No. 1 and its sister concerns known as Kothari Group and the trade union known as Kothari Group Employees' Union functioning in the Head Office at Chennai.

13. Admittedly, the employees at Kolhapur Branch Office were not members of the Union at Chennai. Therefore, to contend that there has been an unfair labour practice on the part of the management by not extending benefits of the settlement at Chennai Head Office to the employees at Kolhapur Branch Office is incorrect. Assuming that the employees at Kolhapur Branch Office were performing same nature of work, the service conditions applicable in Chennai could not be easily lifted and made applicable to the employees at the Kolhapur Branch Office. This is because although Item 5 may be based on the principles envisaged in Article 14 of the Constitution of India, it is applicable only to employees working within a particular establishment. Had there been two sets of service conditions in the Kolhapur Branch Office itself, there would certainly have been an unfair labour practice on the part of the employer. But this is not so in the present case. All the employees at Kolhapur Branch Office were drawing similar wages and there was no discrimination between them inter se. There is not even a whisper that there has been favouritism on the part of the employer to one set of workmen working in Kolhapur. Therefore, the submission made on behalf of the petitioner cannot be countenanced.

14. Mr. Bapat places strong reliance on the observations of the Apex Court in the case of Alvaro Noronha Ferriera and Anr. v. Union of India and Ors. where the Apex Court has enunciated the parameters for invoking the principle of 'equal pay for equal work'. The Apex Court observed that these two parameters would include inter alia the nature of work and common employment. This was the case where the grievance of the petitioners who were judges of the higher judiciary in the subordinate level working in the then Union Territory of Goa, was that their counterparts in the Union Territory of Delhi were getting higher scales of pay for doing the same nature of work, thus, infringing the principle of equal pay for equal work enshrined in the Constitution of India. Prior to 1998, the District Judges in the Union Territory of Goa were getting the same payscales as judicial officers in the Union Territory of Delhi. However, in 1998, the Union Territory of Delhi increased the payscale of Judges while their counterparts in Goa were not given any increase so as to be on par with the Judges of Delhi. The Fourth Pay Commission also did not rectify this anomaly. The District Judges of Goa then approached the High Court. This Court dismissed their petition and then a Special Leave Petition was filed. Basing its decision on the case of Randheer Singh (supra) as also the fact that all along the service conditions of judicial officers under two Union Territories was the same, the Apex Court came to the conclusion that the judicial officers in Goa were entitled to the same scale of pay as that of their counterparts in the Union Territory of Delhi.

15. In my view, this judgment of the Apex Court is of no assistance to the petitioner. The principles governing Industrial adjudication are quite different from those governing persons appointed as judicial officers. In fact, the Apex Court in the case of Indian Hume Pipe Co. Ltd. (supra) has made short shift of the employer's contention in that case that if the service conditions in Wadala factory of the Company were increased, then there was a possibility of similar demands being made by the workers in other factories of the company rendering the working of the factory itself difficult, leading to a possible closure of the factory. Dealing with this contention, the Apex Court has observed thus :

"40. ......... Though at the first flush one would be tempted to agree with Mr. Pai, the temptation will disappear when we inform ourselves of the fact that in a catena of decisions this Court has laid down the industry-cum-region basis as the acceptable basis while working out dearness allowance. This is the usual alarmist cry of the employers. Uniformity of wage structure throughout the country if accepted will be giving a go-by to the well settled principle of industry-cum-region. This Court has time and again laid down the industry-cum-region principle whenever the question of wage structure arose. As an answer to plea of the respondent, we will only read the following passage from the judgment in the case of Workmen v. Indian Oxygen Ltd. to which one of us was a party. Desai, J. while repelling the plea that in an industrial undertaking which has an all-India operation, the unit as a whole should be considered, observed thus (SCC p. 185, para 14) :

"14. On behalf of the Karmachari Union, it was contended that in devising a dearness allowance formula, the region-cum-industry principle should ordinarily be accepted. As pointed out earlier, dearness allowance generally has a local flavour. A man is exposed to the vagaries of the market where he resides and works, even though he may be an employee of a national, multinational or transnational industrial empire. The workman is concerned with the vagaries of price fluctuation in the area in which he resides and works for gain and to which he is exposed. Therefore, the region-cum-industry principle must inform industrial adjudication in the matter of Dearness allowance. In Woolcombers of India Ltd. v. Woolcombers Workers Union, this Court following its earlier decision in Greaves Cotton and Co. v. Workmen held that in devising basic wages and dearness allowance structure, industrial adjudication sometimes leans on the industry part of the industry-cum-region formula and at other times, on the region part of the formula as the situation demands. This well recognised principle of industrial adjudication cannot be given a go-by on the specious plea that the workmen are employed by an industrial undertaking which has an all-India operation. In this case, the Tribunal has overlooked this important principle of industrial adjudication." 41. We have extracted the above passage to repel the argument that if the status quo is allowed to continue in this case, there will be demands from other sectors and other factories. This is only a theoretical apprehension with reference to adjudication was made not at the instance of the workmen, but at the instance of the employer who wanted to bring about a change in the existing system which had satisfactorily worked for 18 years, without producing compelling materials, in support of their claim."

16. Even in the case of Indian Oxygen (supra), the Apex Court has considered the fact that the payment of Dearness Allowance to workmen at a particular place would depend on where the workmen are working irrespective of the fact that the Industrial undertaking in which he is employed is a unit of industrial enterprise having an all-India or inter-State operation.

17. Now in the facts of the present case, it cannot be assumed that despite the fact that the workmen in Kolhapur Branch Office were performing the same nature of work as those in Chennai Head Office, it would necessarily mean that they would be entitled to the same service conditions. Therefore, as a consequence, there cannot be any discrimination between the service conditions of the employees at Chennai and those at Kolhapur.

18. Assuming that the workmen are performing similar nature of work in both the establishments, parity can be established only by raising a demand of it and having it adjudicated by the Industrial Tribunal in a Reference made under Section 10(1)(d). Without this being done, it is impossible to accept that there can be discrimination between the workmen in the two different establishments. Therefore, the question of Item 5 of Schedule IV being breached does not arise.

19. Nothing is brought on record to show as to why Item 9 of Schedule IV has been invoked unless it is the case of the petitioner that it is because the settlement of 22-12-1982 has not been implemented. This settlement in any event, does not cover the employees working at Kolhapur Branch Office and thus, there can be no infringement of Item 9 of Schedule IV of the MRTU & PULP Act.

20. In view of the above, Rule is discharged. No order as to costs.