Delhi High Court
Delhi State Electricity Workers ... vs Nct Of Delhi & Ors on 13 July, 2012
Author: A.K.Sikri
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ LPA 283 OF 2011
LPA 303 OF 2011
WRIT PET.(C) 4567 OF 2010
WRIT PET.(C) 4018 OF 2008
Judgment reserved on: 3.5.2012
% Judgment pronounced on: 13.7.2012
(1) LPA 283/2011, CM 6127/2011, 9219/2011
DELHI STATE ELECTRICITY WORKERS UNION
. . . APPELLANT
Through: Mr. Akhil Sibal, Mr. Rajesh Pathak
and Mr. Salim Amber Inamdar,
Advocates.
VERSUS
NCT OF DELHI & ORS .RESPONDENTS
Through: Mr. N. Waziri, Standing Counsel
(Civil) with Ms. Zeenat Masoodi,
Advocate for GNCTD.
Mr. Sudhir Nandrajog, Sr. Advocate
with Mr. Vishva Wadhwa, Advocate
for NDPL.
Mr. B.K. Sinha, with Ms. Pratibha
Sinha, Advocate for R.2
Mr. S. K. Dubey, Mr. Vivek,
Advocate for DTL.
Mr. Vinay Sabharwal, Advocate for
IPGCL.
Mr. S.N. Chaudhari, Advocate for
BSES RPL
Mr. Mohit Verma, Advocate for
BSES YPL.
Mr. V.K. Tandon, Advocate for
Labour Deptt.
Mr. K.C. Dubey, Advocate for
DESU Majdoor Sangh.
LPA 283/2011,LPA 303/2011, WP.(C) 4567/2010,WP(C) 4018/2008 Page 1 of 37
(2) LPA 303/2011 & CM 6477/2011
DELHI VIDYUT KARAMCHARI UNION . . . APPELLANT
Through: Mr. Sumit Kumar, Advocate.
VERSUS
NCT OF DELHI & ORS ... .RESPONDENTS
Through: Mr. N. Waziri, Standing Counsel
(Civil) with Ms. Zeenat Masoodi,
Advocate for GNCTD.
Mr. Sudhir Nandrajog, Sr. Advocate
with Mr. Vishva Wadhwa, Advocate
for NDPL.
Mr. S. K. Dubey, Mr. Vivek,
Advocate for DTL.
Mr. Vinay Sabharwal, Advocate for
IPGCL.
Mr. B.K. Sinha, with Ms. Pratibha
Sinha, Advocate for R.2
Mr. S.N. Chaudhari, Advocate for
BSES RPL
Mr. Mohit Verma, Advocate for
BSES YPL.
Mr. V.K. Tandon, Advocate for
Labour Deptt.
Mr. K.C. Dubey, Advocate for
DESU Majdoor Sangh.
(3) W.P.(C) 4567/2010
DELHI VIDYUT KARAMCHARI UNION . . . APPELLANT
Through: Mr. Sumit Kumar, Advocate.
VERSUS
LPA 283/2011,LPA 303/2011, WP.(C) 4567/2010,WP(C) 4018/2008 Page 2 of 37
NCT OF DELHI & ORS ... .RESPONDENTS
Through: Mr. N. Waziri, Standing Counsel
(Civil) with Ms. Zeenat Masoodi,
Advocate for GNCTD.
Mr. Sudhir Nandrajog, Sr. Advocate
with Mr. Vishva Wadhwa, Advocate
for NDPL.
Mr. S. K. Dubey, Mr. Vivek,
Advocate for DTL.
Mr. Vinay Sabharwal, Advocate for
IPGCL.
Mr. B.K. Sinha, with Ms. Pratibha
Sinha, Advocate for R.2
Mr. S.N. Chaudhari, Advocate for
BSES RPL
Mr. Mohit Verma, Advocate for
BSES YPL.
Mr. V.K. Tandon, Advocate for
Labour Deptt.
Mr. K.C. Dubey, Advocate for
DESU Majdoor Sangh.
(4) W.P.(C) 4018/2008, CM 9378/2011
DELHI STATE ELECTRICITY WORKERS UNION
. . . APPELLANT
Through: Mr. Akhil Sibal, Mr. Rajesh Pathak
and Mr. Salim Amber Inamdar,
Advocates.
VERSUS
NCT OF DELHI & ORS .RESPONDENTS
Through: Mr. N. Waziri, Standing Counsel
(Civil) with Ms. Zeenat Masoodi,
Advocate for GNCTD.
Mr. Sudhir Nandrajog, Sr. Advocate
with Mr. Vishva Wadhwa, Advocate
LPA 283/2011,LPA 303/2011, WP.(C) 4567/2010,WP(C) 4018/2008 Page 3 of 37
for NDPL.
Mr. S. K. Dubey, Mr. Vivek,
Advocate for DTL.
Mr. Vinay Sabharwal, Advocate for
IPGCL.
Mr. B.K. Sinha, with Ms. Pratibha
Sinha, Advocate for R.2.
Mr. K.C. Dubey, Advocate for
DESU Majdoor Sangh.
CORAM :-
HON'BLE THE ACTING CHIEF JUSTICE
HON'BLE MR. JUSTICE RAJIV SAHAI ENDLAW
A.K. SIKRI, ACTING CHIEF JUSTICE
1. These four separate proceedings, two Writ Petitions and two Letters
Patent Appeals, have commonality of issues and therefore can be
discussed, adjudicated upon and decided by this common judgment.
2. The Delhi State Electricity Workers Union (hereinafter referred to as
the DSEWU) is the petitioner in Writ Petition (C) 4018/2008 and the
appellant in LPA 283/2011. Writ Petition (C)4567/2010 is filed by Delhi
Vidyut Karmchari Union (Regd.) ( hereinafter referred to as the DVKU).
The DVKU is also the appellant in LPA 303/2011. The subject matter of
these four proceedings is as under:-
LPA 283/2011,LPA 303/2011, WP.(C) 4567/2010,WP(C) 4018/2008 Page 4 of 37
LPA 283/2011
The DSEWU has filed this appeal impugning the order dated
21.2.2011 passed by the learned Single Judge in Writ Petition 4763/2010
which was filed by the respondent no.2 i.e. NDPL Staff Association
(hereinafter referred to as „the Staff Association‟). The Staff Association
had filed this writ petition for conducting election for the purpose of grant
of recognition to majority union restricted to the NDPL only. In this writ
petition, the appellant DSEWU was not impleaded and was, therefore, not
heard. The order dated 21.2.2011 was passed by the learned Single
Judge directing the NDPL to conduct the election as prayed for by the
Staff Association within three months. It‟s a brief order of one paragraph
which reads as under:-
"The only relief sought in the writ petition is a
direction to the respondents to conduct election for
the purpose of grant of recognition to the majority
of Trade Union in respondent No.2 Company.
Learned Senior Counsel appearing for respondent
No.2 states that the respondent is prepared to
conduct the election.
In view of the above, respondent No.2 is directed
to conduct election as prayed for within three
months from today.
With this direction, the writ petition is disposed
of."
The grievance of the DSEWU is that the order was passed without
hearing the appellant which is the recognized majority union of workers
LPA 283/2011,LPA 303/2011, WP.(C) 4567/2010,WP(C) 4018/2008 Page 5 of 37
representing workers not only of NDPL but the entire industry supplying
the power to NCT of Delhi of which five companies namely IPGCL, Delhi
TRANSCO, NDPL, BRPL and BYPL form a part. These five companies
(respondent no.3 to 7 in LPA) are the successors of the erstwhile Delhi
Vidyut Board (DVB) which was reorganized as per the Delhi Reforms Act,
2000. It is claimed that the DSEWU was recognized by the DVB as
majority union and has the right to seek this recognition by the NDPL as
well on the basis of majority in the industry and it should not be restricted
to NDPL alone.
Writ Petition (C) 4018/2008:
This petition is filed by the DSEWU claims the same relief based
on specific plea that it was a recognized majority union in the erstwhile
DVB and all the successors companies were bound to negotiate with this
Union in good faith and also seeks quashing of letter dated 11.12.2007
issued by the Delhi TRANSCO Ltd. and Indraprastha Power General Co.
Ltd. (IPGCL) as per which neither DVKU nor DSEWU was eligible to be
recognized as majority union referring to the provision of Section 22 (2) of
the Trade Union Act, 1926.
Writ Petition (C) 4567/2010
This petition is filed by DVKU seeking a writ/order/direction to the
respondents therein, particularly the Chief Labour Commissioner Delhi to
LPA 283/2011,LPA 303/2011, WP.(C) 4567/2010,WP(C) 4018/2008 Page 6 of 37
hold elections by secret ballot to determine the majority character of the
union functioning in the 5 companies, and further a mandamus to the five
companies to recognize the union which would be declared as majority
union. DSEWU, respondent no.8 in the said writ petition, has filed a reply,
supporting the demand for determination of a recognized majority union
across the five successor companies, as per the principle of "One Industry-
One Union".
LPA 303/2011
This appeal arises out of the same orders dated 21.2.2011 passed by
the learned Single Judge in Writ Petition (C) 4763/2010 making same plea
as made by the DSEWU in LPA 283/2011.
3. From the gist of the aforesaid proceedings, it would be clear that the
issue in all these cases is common namely after the incorporation of five
successors companies of DVB, whether elections should be held
"industry-wise" i.e in respect of all the five establishment and any union
which emerges as majority union „industry-wise‟ should be given the
recognition? It is for this reason, order dated 29.3.2011 was passed
clubbing both the writ petitions as well as the LPAs to be heard together.
4. For the sake of convenience and without any fear of contradictions,
we may take note of facts in LPA 283/2011 which was treated as the lead
LPA 283/2011,LPA 303/2011, WP.(C) 4567/2010,WP(C) 4018/2008 Page 7 of 37
case inasmuch as facts of this case would cover the factual position in
other cases as well.
5. The DSWEU is a registered Trade Union and claims that it came
into existence in the year 1947 and has been representing thousands of
workers of the Delhi Electric Supply Undertaking which was later on
converted into DVB. The DSWEU also boast that it has been representing
the workers with various companies after the DVB was unbundled and has
been recognized in various elections as a majority union with a sole and
absolute right of collective bargaining with regard to the interest of the
workers of erstwhile DVB. Last election for determining the majority
character of the union in DVB has been conducted by the Registrar of
Trade Unions in the year 1999 and thereafter there has been no election to
determine the majority character of union working with DVB. Since then
nobody has challenged the majority character of the DSWEU.
6. On 28.10.2000, Government of NCT of Delhi had formed a policy
to restructure DVB for the purpose of restoring operational and financial
viability, and to meet the future demand for sufficient supply of electricity.
Since the employees, engineers and officers of DVB were apprehensive
about their retrenchment/service conditions on restructuring, the
government entered into the Tripartite Agreement with Delhi Vidyut
LPA 283/2011,LPA 303/2011, WP.(C) 4567/2010,WP(C) 4018/2008 Page 8 of 37
Board and Delhi Vidyut Board Joint Action Committee; which was
notified by the Department of Power, Delhi on 16.1.2001.
In the year 2002, the DVB was unbundled into five successor
companies under the Delhi Electricity Reforms Act, 2000 which took over
the generation, transmission and distribution businesses that were earlier
carried out by DVB. The new entities were : Indraprastha Power
Generation Co. Ltd. (IPGCL) for the generation business, Delhi Transco
Ltd. (DTL) for the transmission business, and BSES Yamuna Power Ltd.
(BYPL), BSES Rajdhani Power Ltd. (BRPL) and North Delhi Power Ltd.
(NDPL) [now renamed as Tata Power Delhi Distribution Ltd. (TPDDL) ]
for the distribution business. BRPL and BYPL are subsidiaries of the
Reliance Group while TPDDL is a subsidiary of Tata Power Ltd., Delhi
Power Corporation Ltd. (DPCL) was set up inter alia to take over some of
the liabilities of DVB. The employees of erstwhile DVB who were earlier
involved with the consolidated functioning of the electricity industry
consisting of all the activities of generation, transmission and distribution
have now been transferred to the successor companies mentioned above
which are carrying out specific functions of generation, transmission or
distribution.
LPA 283/2011,LPA 303/2011, WP.(C) 4567/2010,WP(C) 4018/2008 Page 9 of 37
7. It is clear that five separate companies are incorporated under the
Indian Companies Act having their independent entities. After the
incorporation these establishment want their affairs to be regulated
independent of each other including service conditions of the employees.
No doubt, the erstwhile employees of DVB were taken by these five
establishments on the same terms and conditions of service with which
they were governed by the DVB, according to them there is no embargo in
laying down separate and different terms and conditions for the employees
inducted by these companies of their own after 2000. According to the
DSWEU it kept on negotiating with the five establishments for welfare
collective bargaining of the workers of these five establishments who
were/are its members and it shows that all these establishment had
recognized the DSWEU. It is stated that some elections were conducted
in the year 2004 in the Union where one Mr. Kuldeep Kumar, was
elected as General Secretary. However, thereafter the Delhi TRANSCO
and GENCO (IPGCL) stopped negotiating with the DSWEU and issued
Circulars. Aggrieved by such attitude and circulars, the DSWEU filed
W.P.(C) 4018/2008 for direction to the GENCO and Delhi Transco Ltd.
to negotiate with the DSWEU being recognized majority union. As
pointed out above, DKU also filed W.P.(C) 4567/2010 for conduct of the
election in all the five companies to determine the majority in all the five
LPA 283/2011,LPA 303/2011, WP.(C) 4567/2010,WP(C) 4018/2008 Page 10 of 37
companies cumulatively to determine the majority character in the
industry and not establishment wise.
These facts are sufficient to determine the controversy and of course
some other facts would be noticed while taking note of submissions of the
various parties.
8. Circular dated 8.1.2007, the validity of which is challenged,
mentions that neither DVKU nor DSEWU was eligible to be recognized
as majority union because of the provisions of Section 22 (2) of the Trade
Union Act. Challenging the stand taken in the said Circular, Mr. Sibal
argued that a bare perusal of Section 22(2) clearly shows that the basis of
the Letter dated 11.12.2007 and the circular dated 8.1.2007 is entirely
erroneous. The said Section requires office bearers of the Union to be
engaged or employed in the establishment or "industry" with which the
Trade Union is concerned. It is submitted, that the statutorily necessary
percentage of office bearers of DSEWU are engaged in or connected with
the industry supplying electricity to the NCT of Delhi, being erstwhile
employees of DVB. In any event, under the Trade Unions Act in the event
of any violation of any of the provisions of the Act the Registrar is
empowered to cancel the registration which is an appealable order as such
any allegation that Section 22 is being violated is to be raised before the
LPA 283/2011,LPA 303/2011, WP.(C) 4567/2010,WP(C) 4018/2008 Page 11 of 37
Registrar for appropriate action and cannot be resorted to unilaterally by
IPGCL and DTL without following any principles of natural justice to self-
servingly declare that the appellant union is not adhering to Section 22.
Further, by the Circular dated 8.1.2007 read with the letter dated
11.12.2007 IPGCL and DTL purport to exclude the appellant union from
recognition on the ground that its members/office bearers are not employed
by IPGCL/DTL. As such, the said circular and letter is in the teeth of
Section 22 of the Trade Union Act and further amounts to an Unfair
Labour Practice under the industrial Disputes Act and seek to negate
entirely the right to collective bargaining at the level of industry.
9. Insofar as main issue pertaining to recognition of majority trade
union across the industry is concerned, Mr. Sibal advanced the following
propositions:-
(i) In law, and in principle, there can be recognition of a
majority trade union across an industry rather than only
in respect of a constituent unit of such industry.
(ii) Once the first proposition is accepted, it will depend on
the facts and circumstances of a particular case and
industry as to whether the appropriate bargaining unit for
recognition of a trade union is the industry as a whole or
a constituent thereof or both.
(iii) The essence of trade union representation is collective
bargaining. Consequently, the greater the collective, the
LPA 283/2011,LPA 303/2011, WP.(C) 4567/2010,WP(C) 4018/2008 Page 12 of 37
greater the bargaining power. As such, recognition of a
majority union across an industry is to be preferred to
recognition at the level of its constituent units.
(iv) Industry, as a relevant and appropriate bargaining unit,
finds some statutory recognition.
(v) In the absence of a clear statutory mandate or
prescription is as to trade union recognition, it is left up t
the courts to resolve disputes in this regard, and to
enforce the right of workers to collective bargaining.
(vi) Recognition of a trade union is a matter of right for
workers and to some extent compulsion for the employer.
It would be disastrous to leave the choice of recognition
to the unfettered discretion of the employer as that would
result in unfair labour practices.
(vii) It is the right of workers to be represented by a majority
union. To consider such majority character, the industry
rather than the establishment is the preferable bargaining
unit.
(viii) In the facts and circumstances of this case the appropriate
bargaining unit is the industry and not each constituent
company.
(ix) The common and collective interest of ex-DVB
employees absorbed into the successor entities is evident
from the Delhi Electricity Reforms Act, 2000 as also the
Tripartite Agreement dated 16.1.2011. The power of
Collective Bargaining across the five entities to protect
this common interest is a natural corollary.
LPA 283/2011,LPA 303/2011, WP.(C) 4567/2010,WP(C) 4018/2008 Page 13 of 37
(x) An election, under the supervision and direction of a
Court appointed officer, should therefore be held across
all five successor entities to identify and recognize the
majority union across the industry.
(xi) If this Court feel that there should be additionally be
recognition, in terms of the Code of Discipline, in respect
of each successor entity, the appellant is not averse to
the same provided there is an appropriate demarcation to
avoid conflict.
10. He supplemented these submissions with legal propositions, arguing
that collective bargaining by workers is an antidote to the inferior
bargaining position of individual workers, in the employer-worker
relationship in industry. His submission was that collective bargaining
should be encouraged at industry level which was also the mandate of ILO
and the spirit behind Trade Unions Act as well as Industrial Dispute Act.
He referred to the judgment of the Supreme Court in Food Corporation of
India Staff Union Vs. Food Corp. of India 1995 supp(1) SCC 678
wherein the Supreme Court had gone to the extent of calling „collective
bargaining‟ the raison detre of trade unions, observing as under:-
"...Collective bargaining is the principal raison
d'etre of the trade unions. However, to see that the
trade union, which takes up the matter concerning
service conditions of the workmen truly represents
the workmen employed in the establishment, the
trade union is first required to get itself registered
LPA 283/2011,LPA 303/2011, WP.(C) 4567/2010,WP(C) 4018/2008 Page 14 of 37
under the provisions of Trade Unions Act, 1926.
This gives a stamp of due formation of the trade
union and assures the mind of the employer that
the trade union is an authenticated body; the names
and occupation of whose office bearers also
become known. But when in an establishment, be
it ah industry or an undertaking, there are more
than one registered trade unions, the question as to
with whom the employer should negotiate or enter
into bargaining assumes importance, because if the
trade union claiming this right be one which has as
its members minority of the workmen/employees,
the settlement, even if any arrived between the
employers and such a unions, may not be
acceptable to the majority and may not result in
industrial peace. In such a situation with whom the
employers should bargain, or to put it differently
who should be the sole bargaining agent, has been
a matter of discussion and some dispute. The
'check off system' which once prevailed in this
domain has lost its appeals; and so, efforts are on
to find out which other system can foot the bill.
The method of secret ballot is being gradually
accepted. All concerned would, however, like to
see that this method is so adapted and adjusted that
it reflects the correct position as regards
membership of the different trade unions operating
in one and the same industry, establishment or
undertaking.
11. Referring to another judgment of Supreme Court in P.
Virudhachalam Vs. Management of Lotus Mills, (1998) 1 SCC 650 his
submission was that the Supreme Court recognized in that case that
individual workman had by themselves scant bargaining power and
therefore their disputes had to be highlighted by their bargaining agents,
LPA 283/2011,LPA 303/2011, WP.(C) 4567/2010,WP(C) 4018/2008 Page 15 of 37
namely, their unions representing the body of workmen so that the
bargaining power of individual workmen can get strengthened. In the said
case, after taking note of various provisions of the Industrial Disputes Act,
the Court described the principle of collective bargaining in the following
manner:-
"9. It has to be kept in view that the Act is based
on the principle of collective bargaining for
resolving industrial disputes and for maintaining
industrial peace. Thus principle of industrial
democracy is the bed-rock of the Act. The
employer or a class of employers on the one hand
and the accredited representatives of the workmen
on the other are expected to resolve the industrial
dispute amicably as far as possible by entering into
the settlement outside the conciliation proceedings
or if no settlement is reached and the dispute
reaches conciliator even during conciliation
proceedings. In all these negotiations based on
collective bargaining individual workman
necessarily recedes in background. The reins of
bargaining on his behalf is handed over to the
union representing such workman. The unions
espouse the common cause on behalf of all their
members. Consequently, settlement arrived at by
them with management would bind at least their
members and if such settlement is arrived at during
conciliation proceedings, it would bind even non-
members. Thus, settlements are the live wires
under the Act for ensuring industrial peace and
prosperity. Section 10(2) of the Act highlights this
position by providing that where the parties to an
industrial dispute apply in the prescribed manner,
whether jointly or separately, for a reference of the
dispute to a Board, Court, Labour Court, Tribunal
or National Tribunal, the appropriate Government,
if satisfied that the persons applying represent the
LPA 283/2011,LPA 303/2011, WP.(C) 4567/2010,WP(C) 4018/2008 Page 16 of 37
majority of each party, shall make the reference
accordingly. Individual workman comes into the
picture only in connection with a limited class of
industrial disputes as indicated by Section 2A of
the Act dealing with discharges, dismissals,
retrenchments or otherwise termination of services
of an individual workman. Save and except the
aforesaid class of disputes, which an individual
workman can raise, rest of the industrial disputes
including disputes pertaining to illegal lock out,
lay-off and lay-off compensation have to be
filtered through the process of collective
bargaining and they are disputes of general nature
or class disputes wherein individual workman by
himself has no say. In this connection, it is
profitable to keep in view a decision of three-
member Bench of this Court in the case of Ram
Prasad Vishwakarma v. Chairman Industrial
Tribunal, Patna and Ors., (1961)ILLJ504SC
wherein Das Gupta, J., speaking for this Court
made the following pertinent observations on the
scheme of the Act, at the time when Section 2A
was not on the statute book :
"It is now well settled that a dispute between an
individual workman and an employer cannot be an
industrial dispute as defined in Section 2(k) of the
Industrial Disputes Act unless it is taken up by a
Union of the workmen or by a considerable
number of workmen. In Central Provinces
Transport Service Ltd. v. Raghunath Gopal,
(1957)ILLJ27SC , Mr. Justice Venkatarama Ayyar
Speaking for the Court pointed out after
considering numerous decisions in this matter that
the preponderance of judicial opinion was clearly
in favour of the view that a dispute between an
employer and a single employee cannot per se be
an industrial dispute but it may become one if it is
taken up by a Union or a number of workmen.
„Notwithstanding that the language of Section 2(k)
is wide enough to cover disputes between an
employer and a single employee", observed the
LPA 283/2011,LPA 303/2011, WP.(C) 4567/2010,WP(C) 4018/2008 Page 17 of 37
learned Judge, "the scheme of the Industrial
Disputes Act does appear to contemplate that the
machinery provided therein should be set in
motion to settle only disputes which involve the
rights of workmen as a class and that a dispute
touching the individual rights of a workman was
not intended to be the subject of adjudication under
the Act, when the same had not been taken up by
the Union or a number of workmen‟.
This view which has been re-affirmed by the Court
in several later decisions recognises the great
importance in modern industrial life of collective
bargaining between the workmen and the
employers. It is well known how before the days of
collective bargaining labour was at a great
disadvantage in obtaining reasonable terms for
contracts of service from his employer. As trade
unions developed in the country and collective
bargaining became the rule the employers found it
necessary and convenient to deal with the
representatives of workmen, instead of individual
workman, not only for the making or modification
of contracts but in the matter of taking disciplinary
action against one or more workmen and as
regards all other disputes.
The necessary corollary to this is that the
individual workman is at no stage a party to the
industrial dispute independently of the Union. The
Union or those workmen who have by their
sponsoring turned the individual dispute into an
industrial dispute, can therefore claim to have a
say in the conduct of the proceedings before the
Tribunal.
It is not unreasonable to think that Section 36 of
the Industrial Disputes Act recognises this
position, by providing that the workman who is a
party to a dispute shall be entitled to be
represented by an officer of a registered trade
union of which he is a member...."
LPA 283/2011,LPA 303/2011, WP.(C) 4567/2010,WP(C) 4018/2008 Page 18 of 37
12. In addition, his submission that in Section 2 (ra) "unfair labour
practice" is defined as any of the practices specified in the Fifth Schedule.
The Fifth Schedule to the Act, in Part I Clause 15 enumerates as an unfair
labour practice the action of the employers or trade unions of employers,
"to refuse to bargain collectively, in good faith with the recognized trade
unions". Such unfair labour practice is specifically prohibited by Section
25T of the Act and made punishable under Section 25U of the Act.
13. On the basis of that his submission is that the purpose of collective
bargaining is best served if the entire collective speaks in one voice.
However, this may not be achievable in practice and hence it is imperative
that the majority view is accepted by the entire collective. This concept of
majority rule as part of industrial democracy finds recognition in the
provisions of the Industrial Disputes Act, 1947. Particularly, with respect
to a settlement arrived at in the course of conciliation proceedings, Section
10 (2), 10A(3A) read with Section 18(3) (d) which mandate that the action
of the majority will bind the minority, as also future workers. He also
argued that the role of a recognized/majority union was emphasized even
by the National Commission on Labour in its report in 1967.
14. Proceeding there from, Mr. Sibal argued that once recognition of
majority union is accepted as a logical necessity for giving effect to the
LPA 283/2011,LPA 303/2011, WP.(C) 4567/2010,WP(C) 4018/2008 Page 19 of 37
statutory mandate , the next step is to determine the scope and extent of
recognition. Here his submission was that industry wise recognition,
wherever possible, is desirable which concept was even accepted by the
National Commission on Labour. Mr. Sibal also referred to the Code of
Discipline adopted at the 16th Session of the Indian Labour Conference
held in May, 1956 and formally announced on June 01,1958 which gives
priority to the industry wise recognition over establishment/pant wise
recognition. Mr. Sibal also sought to draw sustenance from Section 2(k)
of the Industrial Disputes Act which defines the term "industrial dispute"
and Section 2 (j) which defines "industry" and thus argued that even the
concept of industry and industrial dispute is omnipresent in the ID Act.
15. Based on the aforesaid, his submission was that collective
bargaining being the right of the worker, it is their interest and preference
which could get paramount consideration while determining extent of
recognition. He thus, argued that there was no right to effective collective
bargaining, but here concomitant right goes to the root of the matter i.e.
right to form association which would be meaningless if the right of the
association to collective bargaining is not accepted.
16. Mr. Sibal then proceeded to develop the submission that in the
present case industry-wise collective bargaining was more feasible,
appropriate and justified rather than establishment wise. In order to
LPA 283/2011,LPA 303/2011, WP.(C) 4567/2010,WP(C) 4018/2008 Page 20 of 37
bring home this aspect, his submission was that all the employees in five
successor companies are approximately 12000 of which more than 10000
are ex-employees of DVB. The service conditions of these transferee
employees, such as promotions, transfers, leave and other allowances are
tied together on account of Section 16 of the Delhi Electricity Reforms
Act, 2000 and the Tripartite Agreement dated January 16,2001. A conjoint
reading of Section 16 of the DER Act, 2000 and Clause 3(b) of the
Tripartite Agreement makes it clear that the service conditions of the
transferee employees cannot be modified without "mutual negotiations and
settlement with recognized union/associations".
17. He referred to the provision of Section 16 of the DER Act, 2000 and
submitted that when the personnel had been transferred to a different
company where he enjoyed the same terms and conditions of service, it
could only be the majority union across these establishment that are
industry level which could safeguard their interest more appropriately. He
argued that on similar lines Tripartite Agreement dated 16.1.2001
recognized the rights of the employees of DVB guaranteeing them these
rights provided that:-
"3) Now, therefore, in consideration of the
promises and mutual conditions set forth herein, it
is agreed that in the event of reorganization of DVB
LPA 283/2011,LPA 303/2011, WP.(C) 4567/2010,WP(C) 4018/2008 Page 21 of 37
into two or more corporate entities and
disinvestment of any such entities of GNCT of
Delhi and the DVB guarantee as follows:-
a) There will be no retrenchment of present
employees on account of being declared surplus
or on account of restructuring of DVB and their
status/service conditions will not change.
b) The terms and conditions of service upon
transfer to the corporate entities, such as
promotions, transfers, leave and other
allowances, etc. regulated by existing
regulations/service rules i.e. FR/SR will be
guaranteed to continue the same and any
modifications shall be by mutual negotiations
and settlements with recognized
union/associations without detriment to the
existing benefits.
c) With regard to wage negotiations, the present
system of bipartite negotiations shall continue.
d) to
(i)......................................................
...
(j) All the existing agreements/settlements and
liabilities shall be honoured by successor entities to
the Board and the workmen represented by the
recognized union and the associations.
........................."
18. Mr. Sibal laid emphasis on his submission that it is the appellant
union which was the signatory to the Tripartite Agreement on behalf of
workmen, being the recognized majority union. This status of the
appellant union was accepted by the subsequently created successor
companies, who have been dealing with the appellant union over the last
several years until certain disputes arose qua some of the successor
companies. The above quoted provision and clauses clearly identify the
collective and common interest shared by former employees of the DVB
and the collective interest especially with respect to terms and conditions
of service ought to be protected and enforced through collective bargaining
at the industry level.
19. It is also submitted that the Govt. of NCT of Delhi has created a
pension fund in the form of a trust for the benefit of the transferee
employees which was common for all the employees across the five
successor companies. Likewise, the five successor companies too
constitute a "collective". The Govt. of NCT of Delhi is the most significant
link binding all five successor companies. It owns and manages two of the
five successor entities and has 49% shareholding, with equal management
rights in the remaining three successor companies. He also argued that in
relation to wages, clause 3 (c) of the Tripartite Agreement guarantees to
the workers that the then prevalent system of negotiations i.e. between the
Govt. and the workers through their recognized Union, shall continue. In
relation to wages, the Wage Revision Committee, was constituted with
participation of all the five successor companies. He thus concluded his
arguments by making a passionate plea for recognizing the collective
bargaining at industry level insofar these five establishments off-shoot of
erstwhile DVB is concerned.
20. Mr. Nandrajog, learned Sr. Counsel appearing for the NDPL
countered the aforesaid submission of Mr. Sibal. He countered the
aforesaid submissions of Mr. Sibal by raising a preliminary objection to
the maintainability of these proceedings. His first and foremost
submission in this behalf was that there is no right of recognition at all of
the trade union under any statute and his alternate submission was that
even if such a right could be claimed, these were disputed questions of
facts which required evidence and, therefore, appropriate forum was the
machinery provided under the Industrial Disputes Act by raising industrial
disputes. Giving the scheme of deconstruction of DVB, he pointed out that
it has now been broken into various entities namely, generation,
transmission and distribution. These five establishments were involved
into one or the other activity and therefore their individual character were
totally different from what the DVB was. Moreover, all the three
categories i.e. generation, transmission and distribution were under
different regulators. Insofar as distributing companies are concerned by
giving this work to more than one entity, the idea was to encourage
competition i.e. to break monopoly. In such a scenario, argued Mr.
Nandrajog, that the DSEWU may be dominating in other establishment
but had no partnership in this establishment and giving such a union right
of collective bargaining even in respect of the employees of this unit
would not serve any purpose and would rather defeat the very objective.
21. Mr. Vinay Sabharwal, learned Counsel appearing for the IPGCL
also emphasized that it was the prerogative of the employees to
recognize or not to recognize a union. Recognition is accorded to
maintain peace and harmony in the establishment in order to see that there
is a mechanism for resolving the dispute across the table. For the purpose,
he submitted that it was for the employer to see as to which Union in its
establishment represents the worker and to deal with such a union.
Whether it should be on industry-wise is the decision which has to be left
to the employer. He also submitted that recognition of union was the
subject matter of industrial dispute as provided in Sl. 131 Schedule 5 of the
Industrial Disputes Act and writ petition were not maintainable. Learned
counsel referred to various judgments in support of his submission which
would be referred to at the appropriate stage.
22. DESU Majdoor Sangh had got impleaded itself in these proceedings
and Mr. K.C. Dubey arguing for this Sangh also submitted that writ
petition of DSEWU seeking recognition was not maintainable more so
when there were so many disrupts within the union. He highlighted these
disputes. Thus, there were so many disputes on question of facts which
could be gone into only by the Industrial Tribunal on reference of
industrial dispute.
23. We have considered the aforesaid submissions of the learned
counsel for the parties.
24. Before touching upon the issues involved, we would like to collate
some of the facts in seriatim which have bearing on the questions raised.
As stated above, in the year 2000, the Government of NCT of Delhi
formed a policy to restructure the DVB. Since the employees of the DVB
were apprehensive about their retrenchment and their services, a Tripartite
Agreement dated 16.1.2001 was entered into. The parties into the said
agreement were Government, DVB and DVB Joint Action Committee.
This Tripartite Agreement inter alia provided that:-
"All the existing agreements/settlements and
liabilities shall be honoured by the successor
entities to the Board and the workmen represented
by the recognized union and the associations."
25. In 2002, the DVB was unbundled into five successor companies
with different business namely;
IPGCL - Generation business
DTL - Transmission business
BYPL, BRPL, - Distribution business.
NDPL (TPDDL)
26. DPCL was set up inter alia to take over some of the liabilities of
DVB. The employees of erstwhile DVB who were earlier involved with
the consolidated functioning of the electricity industry consisting of all the
activities of generation, transmission and distribution have now been
transferred to the successor companies and they are discharging specific
function either of generation or transmission or distribution depending
upon the company to which their service has been transferred. It would be
pertinent to mention here that in the year 2001 W.P.(C) 3635/2001 was
filed by DVBKU for determination of majority character. In this writ
petition, following prayers were made:-
"(a) issue appropriate Writ, Order for Direction in
the nature of mandamus directing the respondent
nos. 1 & 2 (DVB and Labour Commissioner,
Government of NCT of Delhi) to determined the
majority character of the trade unions representing
the workmen/employees in respondent No.1(DVB)
for the purpose of recognition as majority union,
through secret ballot, as per the procedure
prescribed in CLC instruction No. 25/80, dated
18.12.1980.
(b) issue appropriate Writ, Order of Direction
directing respondent no.1 (DVB) to recognize the
union found in majority after determination of
majority character through secret ballot system for
a period of two years from the date of the
communication to the said effect.
This writ petition was dismissed by the learned Single Judge vide
order dated 6.2.2002 observing as under:-
"Respondent No.1 now stands bifurcated in to
different entities depending on the areas and nature
of work being performed. In view thereof the
present petition in this form cannot be maintained.
Each entity has to be considered separately as it is
not yet known what would be nature of the union of
each of these entities."
27. In the year 2006, NDPL Electrical Staff Association was formed as
an establishment specific union of TPDDL, which was subsequently
amended as NDPL Staff Association on 22.12.2009. In the year 2007,
DTL and IPGCL refused to deal with DSEWU as the majority union, since
they were outsiders and not their employees. It would be interesting to
note that W.P(C) 4567/2010 was filed by DVBKU for the conduct of
combined elections to be held in all the bifurcated companies and the
W.P.(C) 4018/2008 of DSEWU seeking recognition as majority union had
come up for hearing alongwith WP(C)4763/2010 (out of which LPA
283/2011 arises). They were listed together on the premise that issues in
all the writ petitions were similar in nature. Accordingly, on 8.2.2011,
9.2.2011 and 21.2.2011 these writ petitions were taken up together.
However, on 21.2.2011, the counsel for DSEWU and DVBKU submitted
that they were not concerned with the WP(C) 4763/2010. This writ
petition was filed by NDPL Staff Association seeking direction for holding
election in TPDDL and for determination of the majority character of the
Association. Since TPDDL consented for holding election, the impugned
orders were passed on the basis of said consent. As far as other two writ
petitions were concerned, they were adjourned to 17.3.2011.
28. Be as it may, when the LPAs were filed challenging the order dated
21.2.2011, the other two writ petitions were also listed alongwith these
LPAs under the circumstances already noted above. In these proceedings
consent orders dated 27.5.2011 were passed whereby Division Bench
allowing for separate elections to be held in five successor companies for
the limited purpose of finding out which trade unions enjoys the majority
of the employees. The consent to hold such selections was without
prejudice to the rights and contentions of the parties to the appeal.
Elections were held in each of the five companies through secret ballot on
different dates. DSEWU has won the elections in the three distribution
companies and IPGCL. DVBKU won the election in DTL.
29. From the aforesaid it becomes clear that insofar as DSEWU is
concerned, it already holds majority in the three distribution companies as
well as IPGCL and, therefore, on the basis of that election, it can always
seek recognition. So is the position of DVBKU in DTL.
30. In this backdrop, we have to decide the issue raised by the appellants
namely DSEWU and DVBKU. They claim right of "collective
bargaining" through their representative union and this right of "collective
bargaining" and it is submitted that this right of "collective bargaining
should be „industry‟ based. No doubt, collective bargaining has been
considered by the Apex Court as a raison deter of the trade unions in
Food Corporation of India (supra). The moot issue is as to whether this
"collective bargaining" should be establishment wise or industry based.
There may be circumstances which may define industry-wise recognition.
The National Commission of Labour, 1967 made certain recommendations
which would have bearing on this aspect and therefore the same are
reproduced:-
"We consider that industries, in which workers are
organized on an industry/area basis and in which
collective bargaining has developed at the
industry/area level, should maintain and encourage
this practice of recognizing unions at the
industry/area level. (emphasis supplied). Such
recognition may give rise to certain problems in
regard to the circumstance in which it should be
granted and in regard to the rights and functions of
plant-wise unions vis-a-vis the industry/area
unions, particularly when the majority union at the
plant level has no affiliation with the recognized
industry/area union. It has been brought to our
notice that employers of units in which the
industry-level recognized union has no following,
find themselves n a difficult situation when
confronted by the demands of the plant union,
which they cannot ignore. This situation can only
be set right by a proper demarcation of the rights
and functions of the industry/area recognized
unions and plant-wise unions, and by ensuring
that recognition at the industry/area level is
conferred subject to certain well defined
conditions. We consider that industrywise
recognition is desirable, wherever possible. We
are, therefore, in favour of recognition being
granted to plant unions in an area/industry wherein
a union has been recognized for an industry/area as
a whole." (emphasis supplied)."
31. Likewise, Code of Discipline provides as under:-
"A representative union for an industry in an area
should have the right to represent the workers in
all the establishments in the industry, but if a
union of workers in a particular establishment has
a membership of 50% or more of the workers of
that establishment it should have the right to deal
with matters of purely local interest, such as, for
instance, the handling of grievances pertaining to
its own member. All other workers who are not
member of that union might either operate through
the representative union for the industry or seek
redress directly."
32. So far so good. What is to be noted from the above is that even as
per the aforesaid, industrywise recognition is desirable, wherever possible.
In the present case, whereas the petitioner DSEWU argues that having
regard to the fact that it is erstwhile DVB which was one entity and now
unbundled in these different union and purpose remains the same namely,
generation, transmission and distribution of the electricity and that too, for
the residents of Delhi as well as the fact that the Tripartite Agreement
ensures the existing work norms prevailing in DVB to continue including
service conditions of the employees would continue, the respondents
argued otherwise. Their case is that on the formation of these five entities
with specific job activity/profile, the position has undergone sea change.
There is no similarity in terms of employment and interest of workmen.
Mr. Nandrajog had highlighted that now the service conditions of ex-
DVB employees and employees hired by TPDDL are completely different.
Following tabular comparison was given by him:-
Terms Ex-DVB Employees TPDDL Employees
Wages They are paid wages They are paid wages
in line with the in accordance with
recommendation of the individual
Wage Revision contract entered
Committee headed by between the
Justice Lokeshwar employee and the
Prasad. DA is revised employer. No DA is
twice in a year paid to them.
Eligibility for They are member of They become
GPF. They are member of EPFO.
coverage under a member of pension No pension related
fund and pension is benefit is available
scheme for paid to DVB to them except
employee by pension under EPS. They
trust. They are paid are paid gratuity
retirement benefits gratuity as per the rule under Payment of
prescribed under Gratuity Act.
CCS(Pension)Rules.
Maternity Leave 135 days 84 days
Paternity Leave 15 days 6 days
Child Care Leave 730 days upto 2 No such provision
children till attainment
(for Female of 18 years of age
Employees)
Medical benefits They are provided free No medicine is
medicine at the provided free of cost
company‟s at company‟s
dispensaries and free dispensaries. These
medical treatment at employees are
the hospital in case of covered under
admission at CGHS mediclaim policy
rate. There is taken by the
provision for company. No such
assistance for free medical relief after
medical relief after retirement.
retirement
Voluntary retirement They are guided by No such provision
the provision of Rule
56 (K) of FRs which
regulate voluntary
retirement
Retrenchment Tripartite Agreement They can be
imposes restrictions retrenched.
with regard to
retrenchment of these
employees
33. It was also argued that the concept of recognizing a single
representative union that is exclusively empowered to espouse the claims
of all the employees of TPDDL, disregards the position that TPDDL has
different classes of employees, which may not have demands or aspirations
that are common to one another. Recognizing that a particular union
would have the power to bargain collectively on behalf of all such
employees and to enter into settlements that would be binding on all such
employees may therefore work contrary to the interests of all the workers.
34. When we look the aforesaid contrasting stands taken by the
respective parties, we intend to agree with the submissions of the
respondents i.e. to find out as to whether industry-wise recognition is
feasible or it has to be establishment wise, can be gone into by the
Industrial Tribunal by means of adjudication. The Industrial Disputes Act
contemplates such mechanism to sort out such issues. Mr. Nandrajog,
learned Sr. Counsel has drawn our attention to section 10 of the ID Act
which provide that in respect of each industrial dispute where the parties
apply for a reference to any of the forums prescribed under the ID Act,
that the appropriate government shall, if satisfied that the persons applying
represent the majority of each party, make a reference accordingly.
Likewise, Section 10A(3A) of the ID Act provides for reference to
arbitration. Therefore, with respect to each reference, (i) the appropriate
government is required to be satisfied as to whether the majority has been
represented; and (ii) in case of arbitration, the concerned parties have to be
allowed the opportunity of presenting their case. Such provisions militate
against the proposition put forth by DSEWU that a particular union can
claim a general right to be recognized as they representative union entitled
to represent the workmen of an establishment on all issues. The ability and
keenness of any union to effectively represent the employees on a
particular issue has to be seen in light of the particular facts of a case and
the class of employees who would be affected by such negotiation.
Therefore, the issue whether establishment-wise recognition is to be given
to the unions or it should be industrywise, needs adjudication for which
the appropriate forum would the Industrial Tribunal.
35. We have also to bear in mind that as of now, there is no statutory
provision, which gives right to a union to seek recognition and such a right
can be claimed only by raising industrial dispute. We would like to high
light to mention the internal disputes as highlighted by the learned
counsel for the DESU Mazdoor Sangh. He had submitted that after this
Court directed elections vide order dated 27.5.2011, in compliance with
the said order, the Deputy Labour Commissioner vide order dated
12.8.2011, specifically wrote "unions registered under Trade Union Act,
1926 only can file their nomination papers before the respective Presiding
Officers". The petitioner submitted its nomination paper. It mentioned the
date of registration as 06.04.1970. It wrote its Regn. No.36. It submitted a
Registration Certificate which is in the name of "Delhi Electric Supply
Undertaking Workers Union" which bears Regn. No. 1456 dated
06/04/1970. It is sought to point out that the registration No. 36 is against
the name of an Union namely "The Delhi State Electricity Workers
Union". There was another union namely "Delhi Electricity Supply
Undertaking Workers union" bearing registration No.1456 dated
06/04/1970. A letter dated 31/3/1973 issued by the office of Registrar
Trade union shows that the said second Union bearing Regn. No. 1456
merged into the union bearing Regn. No. 36. Thus, on 28/12/1972 the
union namely "Delhi Electricity Supply Undertaking Workers Union"
bearing Regn. No. 1456 was merged into "the Delhi State Electricity
Workers Union" bearing Regn. No. 36. Therefore, the Regn. No. 1456 is
no more in existence and the Regn. No. 36 is of the Union namely "The
Delhi State Electricity Workers Union." Mr. Dubey, further submitted that
the reply from the Deputy Labour Commissioner does show that he
petitioner is not a registered Trade Union.
36. For this reason, we dismiss these LPAs as well as the Writ Petitions
giving liberty to the petitioners in these writ petitions to raise industrial
dispute, if they so desire.
37. No order as to costs.
ACTING CHIEF JUSTICE
(RAJIV SAHAI ENDLAW)
JUDGE
JULY 13, 2012
skb
