Management of National & Grindlays
Bank Ltd. Vs. Their Workmen  INSC 174 (3 August 1971)
REDDY, P. JAGANMOHAN REDDY, P. JAGANMOHAN
CITATION: 1971 AIR 2454 1972 SCR (1) 7 1971
SCC (2) 595
Employees-"Medical aid and expenses" Bipar tite Agreement-Need for
The employees of the Kanpur branch of the
enjoyed medical facilities without a monetary
Under the Sastry Award, and under the Desai
Award which substantially adopted the Sastry Award in this respect, the higher
medical benefits enjoyed by the employees of the branch, were to continue. In
pursuance of the Bipartite Settlement in 1966 an attempt was made to
standardise "Medi- cal aid and expenses" by bringing the employees of
the branch in line with the other branches of the bank, but without success.
During the conciliation proceedings before the Regional Labour Commissioner the
appellant was agreeable, until the next All India Settlement/ Award in the
banking industry when the workmen of the appellant bank at Kanpur would fall in
line with that settlement/award to a higher limit of Rs. 250/- for medical aid
and expenses for the, employees of the branch as compared to the ceiling fixed
under the Bipartite Settlement for employees of other banks. This limit was 'to
be applicable to the employees as well as to their families. The appellant bank
was also agreeable to pay the hospitalisation expenses but only of the workmen.
A dispute as to what should be the monetary limit up to which medical aid and
expenses should be admissible to the workmen of the Kanpur branch was referred
to the Industrial Tribunal and the Tribunal gave-an award declaring that the
employees of the branch and their families would be entitled to medical aid and
,expenses up to a monetary limit of Rs. 250 per year. The Tribunal further
directed that the appellant-bank would defray the hospitalisation charges not
only for the employees but also for the members of their families.
In appeal to this Court, against the award,
it was contended that the Tribunal, having rerognised the need for
standardising benefits in respect of medical aid and expenses, ought not to
have fixed them at a rate higher than those fixed for the employees of the bank
in other branches, particularly, when nothing had been shown As to why the
Kanpur branch employees should be given favoured treatment.
It was also contended that the award relating
to hospitalisation was made applicable to the members of the family of the
employees at Kanpur' while no such facility was available to the other workers.
The respondents took the stand that the benefits enjoyed by the employees of
the branch of having unlimited medical aid facilities could not be curtailed.
2-M1245Sup. Cl/71 8
HELD : (1) The object of the Bipartite
Settlement was to standardise the facility in respect of medical aid and
expenses; but when it was found that one of the branches of the appellant bank
was not able to fall in line that was left to further negotiations, but nonetheless,
it was made manifest that standardisation should be achieved to bring them in
line With other workmen of the bank. When once there has been a general
revision in respect of pay scales and other amenities and facilities which are
more advantageous than under the previous award there seems to be no reason why
the employees of the Kanpur branch should be treated as favoured employees,
particularly, when nothing has been stated nor any material relied upon to show
why they should be so treated. It is not a case of protecting the wage of an
individual workman who was getting higher than what is envisaged in the
standardisation scheme at. the time when such a scheme is brought into force.
[14D 15B] (2)Further, there is no justification for the tribunal to extend the
hospitalisation facilities to the members of the families if that was not
enjoyed by the workmen in the other branches of the appellant Back and in other
Banks which are similarly situated. [15E] (3) However, in view of the fact that
the appellant Bank was agreeable to give a higher limit as indicated in its
offer before the Conciliation Officer, though for a limited period, namely,
till the next All India Settlement Award, which was also reiterated before this
Court, the interest of the employees of the Kanpur branch are well served by
that offer. [15G] [The Court accordingly, directed that a higher limit or Rs. 250/be
fixed ,towards medical aid and expenses of each of the employees of, the Kanpur
branch and their families as defined in the Bipartite Agreement, the higher
limit to be effective till the next All India Settlement/Award. It was further
directed that each of the workmen would also be entitled to hospitalisation in
terms of the said agreement.]
CIVIL APPELLATE JURISDICTION.:CIVIL Appeal
No. 553, of 1970.
Appeal by special leave from the Award dated
November 19, 1969 of the C.G.I.T.-Cum-Labour Court, Jabalpur in Case No.
CGIT/LC(R) 1 of 1969.
G. B. Pai and P. N. Tiwari, for the
M. K. Ramamurthi and Vineet Kumar, for the
The Judgment of the Court was delivered by p
Jagnmohan Reddy, J. This is an Appeal by Special Leave against the Award made
by the Industrial Tribunal at Jabalpur on 18th November 1969, declaring 9 that
the employees of the Kanpur Branch of the Appellant Bank which is classified as
an 'A' Class Bank will be entitled to medical aid and expenses upto a monetary
limit of Rs. 250/- per year from January to December, which medical aid shall
be available to the employees as well as to the members of their families as
defined in paragraph 15.
1.1 of the Bipartite settlement. The Tribunal
further directed that the Appellant Bank will defray the hospitalisation
charges not only for the employees but also for members of their families on
the condition that the hospitalisation is recommended by the Bank's Doctor and
that any amount utilised out of medical aid ceiling which. may be outstanding
to the credit of the employee concerned shall first be utilised to pay the
hospitalisation bill and any balance remaining thereafter shall be met by the
Bank. This Award was to take' effect from 1 -1-70 and was to be in force till
such time as modified in accordance with law.
The Appellant Bank, challenges the
jurisdiction of the Tribunal to make the aforesaid Award and further contests
it not only on the ground that it is discriminatory and shows an unwarranted
favour to the employees of one of its Branches at Kanpur but that it is.
against the principle of standardisation which was the basis of the Bipartite
agreement. In order to appreciate these contentions a brief history of the
previous Awards and Settlements concerning the medical aid granted to the, All
India, Bank Employees may be useful.
In March 1953 an Award known as the Sastry
Award was made which while dealing with other terms and conditions of service
of the Workmen dealt with the dispute regarding medical aid and' expenses on
industry wise basis. This Award 'classified the-Banks into various categories
for determination of the terms and conditions of, service of Workmen of such
Banks which @ Were equally applicable for grant of medical aid and expenses The
Award relating to medical aid and expenses Was dealt with in Chapter XXII para
450 by and under which the then existing facilities regarding medical aid and expenses
which were being enjoyed by the Kanpur Branch of the Appellant Bank and which
were more favourable than the provisions made under that 10 Award were to
continue. It may be stated that the employees of the, Kanpur Branch enjoyed
medical facilities for themselves alone without a ceiling. Although the Labour
Appellate Tribunal in an Appeal against that Award modified certain of its
provisions, against that Award modified certain of its provisions the terms and
conditions in para 450 Clause 2, relating to the higher medical benefits which
were being enjoyed were to continue as heretofore. The following extract of
para 450 is relevant 450(1) Medical facilities should be availed of only by the
workman. Members of his family are not entitled to the same.
(2) Wherever existing facilities in any Bank
or Banks are superior to the provisions hereinafter made, such facilities
should be continued.
(10) The total expenses from January to
December of each calendar year on account of medical attendance and treatment payable
by a Bank to a Workman shall not exceed the following limits Class of Banks
Class of Areas.
I II III Rs. Rs. RS.
A 90 60 50 B 75 50 40 C 60 40 30 D 30 20 15
Then came the Desai Award which replaced the Sastry Award as modified by the
Labour Appellate Tribunal. Even though a large number of terms and conditions
in Banking industry were modified by this Award it did not interfere with the
provisions of para 450 of the Sastry Award which had preserved the rights of
the employees to enjoy the then existing medical facilities. The following
extracts from the Award will indicate that the Sastry Award was substantially
adopted:- 11.11. The benefits given under the Sastry Award so far as medical
aid and expenses are concerned, are reasonable in the present circums- 11
tances. Workmen have claimed that medical facilities should be extended to the
members of Workmen s family. Both the Sastry Tribunal and the Labour Appellate
Tribunal considered this matter and could not see their, way to grant this
demand. It was considered that the health of the family was primarily a charge
on the pay and emoluments of an employee and not on the Bank. No such change in
the circumstances has taken place which would warrant the grant of this
facility. This demand may be covered when the employees State Insurance Scheme
is made applicable to the Workmen in the Banking Industry.
11-16. I accordingly direct that so far as
the Workmen in A & B Class Banks are concerned, the amount of total
expenses provided on account of medical attendance and treatment from January
to December of each calendar ,year should be allowed to accumulate so as not to
exceed at any time three, times the maximum amount provided under this Award.
On 19th October 1966 a settlement in respect
of the Industrial dispute between the Management of the Banks as represented by
the Indian Banks Association and the Bombay Exchange Banks Association and
their Workmen as represented by the All India Banks Employees Association and
All India Banks Employees Federation was arrived at, which is commonly referred
to as the Bipartite settlement. Some of the terms and conditions which were in
operation under the Desai Award were revised. Chapter XV of this agreement
modified the Award relating to 'Medical aid and expenses' as specified therein.
The modifications relevant for the purposes of this Appeal are as follows:-
(a)In supersession of sub-clause (1) of paragraph 450 of the Sastry Award,
medical facilities as provided in this Chapter shall be available to workmen
and members of their family consisting of wife, children wholly dependent upon
the workman, and dependent widowed mother.
12 PROVIDED always that nothing in this
settlement as regards "medical Aid and Expenses" shall apply to those
workmen of the National & Grindlays Bank Ltd., Kanpur, who are enjoying
"Medical Aid & Expenses" for themselves Without monetary
ceiling,. it is agreed that the parties hereto will hold discussions in an
endeavour to standardise "Medical Aid and Expenses" for such workmen
by bringing them in line with the other workmen of the Bank in regard to
"Medical Aid and Expenses".
(b). . . . . .
(c)in supersession of sub-clause (1) of
paragraph 450 of the Sastry Award the total expenses from January to December
of each calendar year on account of medical attendance and treatment payable by
a Bank to a workman shall not exceed the following limits:- Area I Area IIArea
III Rs. Rs. Rs.
'A' Class Banks 135 90 75 'B' Class Banks 113
75 60 'C' Class Banks 80 54 40 Such facilities should not include supply of dentures,
spectacles, hearing and other aids".
After this Bipartite settlement an attempt
was made to standardise medical aid by bringing the employees of the Kanpur
Branch in line with "other Branches of the Bank but without success.
During the conciliation proceedings before the Regional Labour Commissioner,
Kanpur the Appellant was agreeable, until the next All India Settlement/Award
in the Banking Industry when the Workmen of the Appellant at Kanpur will fall
in line with that Settlement /Award, to a higher limit of Rs. 250/- for medical
aid and expenses for the ,employees of the Kanpur Branch as compared to the
ceiling fixed under the Bipartite settlement for employees of other Banks. This
limit was to be applicable to the employees as well as to their families.
13 The Appellant Bank was also agreeable, to
pay the hospitalisation expenses but only of the workmen subject to the
condition that any amount unutilised as per the limit of medical aid and
expenses to which the employee was entitled was to be utilised first to pay the
hospital bills. The Respondents wanted the limit to be raised to Rs. 400/-,
that hospitalisation should also be permissible for family and that they do not
agree to the automatic linking of this benefit in Kanpur Branch to other Bank
employees at the time of the next Settlement/Award. After the conciliation
proceedings failed, the following dispute was referred to the Tribunal namely :
"What should be the monetary limit upto
which medical aid and expenses should be admissible to the workmen of National
& Grindlays Bank Ltd., Kanpur Branch and front which date".
The Tribunal called for information in
respect of the number of employees in the category of workmen, as well as of
officers or staff on special rates and pay working at the Kanpur Branch. It
also required the Bank to give the monetary ceilings which have been fixed by
the bank for its officers. After receiving the information in respect of the
aforesaid matter the Tribunal made the impugned Award.
It was sought 'to be contended before the
Tribunal that the Sastry and Desai Awards which preserved the benefits enjoyed
by the employees of the Kanpur Branch of the Appellant Bank could not be
curtailed to their disadvantage and that the matter is concluded by
res-judicata. This argument was rejected as being misconceived. It was pointed
out that the bipartite settlement clearly stated that the medical aid and
expenses have to be standardised for the workmen of the Kanpur Branch for
bringing them in line with the employees of the other Branches. In order to
achieve this aim a a direction was given to the parties to hold discussions in
an endeavour to come to a settlement. The Tribunal further Pointed that the
terms of reference of the dispute itself envisaged the determination of the question
of fixation of the monetary limit and hence it was not Precluded from, going
into that question.
14 The AWard is assailed on the ground that
the Tribunal having recognised the need for standardising the benefits in
respect of Medical aid and expenses it ought not to have fixed them at a rate
higher than those fixed for the employees of the Bank in other Branches
particularly when nothing has been shown as to why the Kanpur Branch employees
should be given a favoured treatment. It is also contended that the Award
relating to hospitalisation" has been made applicable to the members of
the family of the employees at Kanpur while no such facility is available to
the other workers. On the other hand the Respondents adopt the stand taken up
before the Tribunal namely that benefits enjoyed by the employees of the Kanpur
Branch of having unlimited medical aid facilities cannot be curtailed.
It appears to us that the object of the
bipartite agreement was to standardise the facility in respect of medical and
and expenses, but when it was found that one of the Branches of the Appellant
Bank was not able to fall in line that was left to further negotiations, but
nonetheless it was made clearly manifest that standardisation should be
achieved to bring them in line with the other workmen of the Batik in regard to
Medical aid and expenses.
There can be no doubt as to the validity of
the principle of standardization and particularly when nothing has been stated
nor any material placed before us as to why the Kanpur employees of the,,
Appellant Bank should be given a favoured treatment. When we consider the
workmen in cities bigger than Kanpur like Calcutta, Bombay and Madras being
given the same facility as that which was agreed to, there appears no
justification for giving the Kanpur employees who fall in the same category
i.e. Class A, Area 1, a different and more advantageous treatment. Even when
the Kanpur employees enjoyed unlimited medical benefits, those benefits were
not available to the members of their family nor was the hospitalisation
extended to them. It was pointed out that under the unlimited scheme the
expenditure incurred on the employees on an average was Rs. 250/- and above,
but this as has already been pointed out is only limited to the employees and not
to 15 their families. When once there has been a general revision in respect of
the pay scales and other amenities, and facilities which are more advantageous
than under the previous Award there seems to be no reason why the employees of
the Kanpur Branch should be treated as favourdd employees. It is not a case of
protecting the wage of an individual workman who was getting higher than what
is envisaged in the standardisation scheme at the time when such a scheme is
brought into. force. If that were so we would have kept in view the three
conditions laid down in Birla Cotton Spinning & Weaving Mills v. Workmen
We do not find any cogent reasons upon which
the Tribunal has distinguished the case of the workmen at Kanpur and singled
them out for beneficial treatment. It may be noticed that under the bipartite
agreement the workmen are having the benefit of medical aid extended to the
members of the family which was not applicable to the workmen before.
Even though the employees of the Kanpur
Branch had no upper limit their families were not given the benefit of medical
aid, nor is there any justification for the Tribunal to extend the
hospitalisation facilities to the members of the families if that was not
enjoyed by the workmen in the other Branches of the Appellant Bank and in other
Banks which are similarly situated. We are unable to find any principle or
justification for giving the employees of the Kanpur Branch a favoured
treatment which other 'employees of the Banks and even of the Appellant in
other Branches cannot avail, under the Bipartite agreement. In this view we
would have placed them in the same category as the employees of other Branches
of the appellant who are similarly situated. However, in view of the fact that
the appellant Bank was agreeable to give a higher limit as indicated in its
offer before the Conciliation Officer though for a limited period namely till
the next All India Settlement/Award which offer was also reiterated before us
but was not accepted, we think that the interests of the employees of the
Kanpur Branch are well served by that offer. Accordingly we allow the appeal
partly And direct that a higher limit of Rs. 250/- be fixed towards medical aid
and expenses of each (1) 2 S.C.R. 716 @ 730-731.
16 of the employee of the Kanpur Branch and
their families as defined in the bipartite agreement. Apart from this each of
the workman is also entitled to hospitalisation in terms of the said agreement.
This higher limit will be effective till the next All India Settlement/Award.
Each party will pay his own costs.
K.B.N. Appeal partly allowed.