Workmen of Williamson Major & Co.
Ltd. V. Williamson Major & Co. Ltd. & ANR [1981] INSC 197 (7 December
1981)
ISLAM, BAHARUL (J) ISLAM, BAHARUL (J)
TULZAPURKAR, V.D.
VARADARAJAN, A. (J)
CITATION: 1982 AIR 78 1982 SCR (2) 42 1982
SCC (1) 117 1981 SCALE (3)1825
ACT:
Industrial Disputes Act 1947 Ss 10 and 15.
Management granting promotion to junior
employees- Rightful claim of senior employees superseded-Industrial
dispute-Whether there is victimization-Jurisdiction and duty of industrial
tribunal to declare promotions illegal and unjustified-In consultation with
management and union frame norms and rules for promotion.
Labour Law-Promotion-Whether a managerial
function- Whether to be on subjective satisfaction of management or on some
objective criteria.
Words & Pharases-'Victimisation'-Meaning
of- Interpretation in favour of labour whether to be accepted.
HEADNOTE:
The Workmen (Respondent No. 1) alleged that
the Management (Appellant) started giving indiscriminate and arbitrary
promotions and/or upgradations to some of the employees who were its
favourities, disregarding the rightful claims of a number of other employees so
much so that even junior members were given promotions superseding the rightful
claims of the senior employees. According to the Union, the management
arbitrarily promoted/upgraded three persons and unjustly denied
promotion/upgradation to twelve senior employees and that this was
victimisation and unfair labour practice, and that these three persons after
their promotion/upgradation used to do the same work as before occupying the
same chairs and working on the same tables as they had done before the date of
upgradation/promotion.
As a dispute arose between the management and
the union, the State Government referred the issue to the Industrial Tribunal
for adjudication. During the pendency of the reference before the Tribunal the
management again promoted from the General to the Special Grade two clerks
superseding 56 senior and efficient clerks of the General Grade. This issue was
also referred to the Industrial Tribunal.
The Tribunal, on a consideration of the oral
and documentary evidence adduced before it, found that the management did not
care to establish the 43 justification of the promotions of the persons named
in the two references superseding the claim of the others, but held that it
could not give any relief to the workmen when their positive case was that
there was no standard or norms for giving promotion.
In the appeal to this Court it was contended
on behalf of the Management that: (1) Promotion is not a condition of service
in a private company, and (2) although there were no norms, the promotions of
the persons in question were not arbitrary and that unless victimisation was
proved by the union, the management's action should not be disturbed.
Allowing the appeal
HELD: 1. (i) The management, in consultation
with the workmen or their representatives and under the direction, supervision
and control of the Labour Commissioner shall frame norms/rules fixing quota for
the grades and for promotion/upgradation of its workmen, and the upgradation
and/or promotion shall be made by the management in terms of the norms/rules so
framed. [51 D-E] That meanwhile the promotions/upgradations of the three
persons which is the subject matter of the first reference and the
promotions/upgradations of the two persons which is the subject matter of the
second reference are cancelled and these workmen shall be at par with the
workmen who were superseded till promotions/upgradations are made by the
management in terms of the norms/rules to be prepared. No future
promotions/upgradations shall be made until the norms/rules are framed. [51
F-52 A] (ii) Industrial Tribunals are intended to adjudicate industrial
disputes between the management and the workmen, settle them and pass effective
awards in such a way that industrial peace between the employers and the
employees may be maintained so that there can be more production to benefit all
concerned. For this purpose the industrial tribunals, should not be constrained
by the formal rules of law and should avoid inability to arrive at an effective
award to meet justice in a particular dispute. [48 F-G] In the instant case there
was victimisation of the superseded workmen. The Tribunal should have,
therefore declared that the promotions were illegal and unjustified, being the
result of arbitrary action of the management which was nothing but unfair
labour practice and the promotions should have been cancelled. It should also
have in consultation with the management and the union framed norms/rules of
promotion and directed the management to give promotions/upgradations in
accordance with those norms and rules. [48 H-49 A]
2. (i) Although promotion/upgradation is a
managerial function it must not be on the subjective satisfaction of the
management but must be on some objective criteria. [49 E] (ii) The normal
meaning of 'Victimisation' is being the victim of unfair and arbitrary action.
When the word 'victimisation' can be interpreted in two different ways, the
interpretation which is in favour of the labour should be 44 accepted as they
are the poorer section of the people as compared to the management. [50 G, D]
Bharat Bank Ltd. v. Employees of Bharat Bank Ltd.
[1950] S.C.R. 459: K.C.P. Employees
Association Madras v. Management of K.C.P. Ltd. Madras & Ors. [1978] 2 SCC
42 referred to.
CIVIL APPELLATE JURISDICTION : Civil Appeal
Nos. 351 & 352 of 1976 Appeals by special leave from the Award dated the
31st May, 1975 of the Seventh Industrial Tribunal, West Bengal, Published by
the Government of West Bengal, Labour Department in Reference Case No.
VIII-39/74, G.O. No. 3278- IR dt. 2.4.1974. & VIII-282/74, GO No. 7537-IR
dated 10.12.1974.
D. L. Gupta S. K. Nandi and Krishna Prasad
for the Appellant.
G. B. Pai, N. C. Shah, J. R. Das and Parveen
Kumar for the Respondent.
The Judgment of the Court was delivered by
BAHARUL ISLAM, J. These two connected appeals by special leave are on behalf of
Workmen of M/s Williamson Magor & Co. Ltd. (renamed as M/s Macneill &
Magor Ltd.) represented by Williamson Magor & Company Employees' Union
(hereinafter called 'the union') and are directed against the award of the 7th
Industrial Tribunal, West Bengal.
2. The material facts may be stated thus:
According to the union, all the employees of
the aforesaid company, the respondent before us (who will hereinafter be called
'the management') are the members of the union. Disputes had arisen between the
workmen and the management but they ended in a number of agreements as a result
whereof the employees derived some benefits.
Subsequently the management appointed one Mr.
P. K. Kaul as a staff officer, who, according to the union, started to create a
cleavage between the workmen, and with that end in view, at his instance, the
management started giving indiscriminate and arbitrary promotions and/or
upgradations to some of the employees who were its favourites, disregarding the
rightful claims of a number of other employees so much so that even 45 junior
members were given promotions superseding the rightful claims of the senior
employees. The union took up the cause of the workmen with the management.
According to the union, there is no norm and/or standard guiding promotion
and/or upgradation of the employees. According to the union, the action of the
management is arbitrary, mala fide and intended to victimize the employees who
are loyal to the union.
At the material time there were two grades of
employees namely; Special Grade, with a higher scale of pay and General Grade.
3. This is an admitted position that the
management do not have any norm to determine how many clerks should be in each
of the said grades or in each of the scales of pay; nor is there any fixed
quota in the Special Grade to be filled up by promotion from the General Grade;
nor is there any rule determining the number of vacancies to be filled up by
promotion or upgradation. According to the union, the normal rule should be
promotion/upgradation by seniority. As this was not done, unrest cropped up. On
the management having upgraded/promoted two junior clerks, namely; Anil Chandra
Ghose and Parameshwar Banerjee from General Grade to Special Grade on 1.3.1972,
superseding the claims of senior clerks, without assigning any reason, the
union protested. Far from rectifying the unjust action, the management again
promoted/upgraded another person, Shri Saroj Mukherjee to Special Grade on
1.7.1972, superseding the claims of many others who were senior to him.
According to the union, the management arbitrarily promoted/upgraded the
aforesaid three persons and unjustly denied promotion/upgradation to twelve
senior clerks. This was, according to the union, victimization and unfair
labour practice. According to the union, the aforesaid three favoured clerks
and the twelve superseded clerks were doing exactly similar work. The three
promoted/upgraded persons after their promotion/upgradation used to do the same
work as before, occupying the same chairs and working on the same tables as
they had done before the date of upgradation/promotion. According to the union,
there were no jobs related to grades or scales of pay, and the promotion
upgradation has no impact except mere increase of pay consequent upon the
higher scale of pay given to each person promoted. As a dispute arose between
the management and the union the Government of West Bengal referred 46 the
following issue to the 7th Industrial Tribunal, West Bengal for adjudication:
"Whether promotion of Sharbashree Saroj
Kumar Mukharjee, Anil Chandra Ghose and Parmeshwar Banarjee from General Grade
clerks to Special Grade Clerks in preference to the twelve (12) workmen marked
in Annexure "A" attached herewith is justified ? To what relief, if
any, are the workmen marked in Annexure "A" entitled ? The names of
the persons in said Annexure "A" were the same as mentioned in
paragraph 10 above".
4. During the pendency of the aforesaid
reference before the Tribunal, the respondent on 23.5.1974 again promoted from
the General to the Special Grade two clerks, namely Sudhir Ranjan Chakraborty
and Jyoti Prasad Paul superseding 56 senior and efficient clerks of the General
Grade inclusive of the twelve senior grade clerks already superseded in 1972
and concerned in the reference, aforesaid. As a dispute arose, the Government
of West Bengal made a reference to the same Industrial Tribunal for
adjudication of the following issue:
"Whether promotion of the workmen
mentioned in Annexure "A" attached herewith from General Grade to
Special Grade or Supervisory Grade in preference to the workmen mentioned in
Annexure "B" attached herewith is justified ? To what relief, if any,
are the workmen mentioned in Annexure "B" entitled?"
5. Before the Tribunal, the parties led
evidence and proved Exts. K-l and K-2, settlements arrived at between the
management of the union earlier. On a consideration of the oral and documentary
evidence adduced before it, the tribunal has arrived at the following
findings:- (1) No agreed norm for promotion/upgradation was formulated.
(2) Both the parties felt that it was
desirable that certain norms should be laid down for promoting and/or upgrading
workmen.
47 (3) That in spite of the fact that no norm
had been formulated, the management promoted as many as 15 workmen during the
pendency of the first reference.
(4) That promotion and/or upgradation is a
managerial function and that the union can have no say in such matter. The
Tribunal has found "it is now more or less settled that the promotion/upgradation
is the administrative function of the management and it can be hardly disputed
before any court of law and/or tribunal unless it is proved that in effecting
such promotion, the management violated the principles of natural justice
and/or existing rules or norms". The Tribunal also has found, on a
consideration of the evidence of the management witness, Shri P. K. Kaul, that
although the witness said that at the time of giving promotion, recommendations
of the departmental heads and other authorities were taken into account, his
evidence was not supported by any document. The tribunal has also found that
although in terms of earlier agreements, it was the duty of the management to
investigate allegations by the union of discriminatory and unfair promotion
and/or upgradation, the management did not do so. It further found that Ext. B
disclosed that on 21.12.1972, the union demanded of the management
investigation into the matter of the said discriminatory promotions but
"curiously enough, there is nothing before me to show that the management
did, in compliance with the said agreement, investigate into the matter as
agreed upon." (5) Ultimately the Tribunal held that the promotions of the
three persons mentioned in the first reference "cannot be justified
because when it was agreed upon that the management would investigate in case
any complaint is made, but even in spite of the complaint lodged by the union,
the management did not investigate." The Tribunal has even found that the
management did not care to establish the justification of the promotions of the
aforesaid three persons superseding the claims of others.
(6) The Tribunal has also found, "it is
not their (management's) case before me that, in fact, the management found
those three persons suitable to the rest of the workmen.
(7) Similarly, with regard to the second
reference, the Tribunal came to the finding that "junior persons were
given promotions superseding the claims of a number of senior workmen, but
there is nothing before me from where I can say that the management was
justified in giving promotion to them."
6. The above enumeration of the findings of
the Tribunal clearly shows that the action of the management in promoting
junior clerks of the General Grade superseding the claims of the senior clerks
of the same Grade was arbitrary and unjustified. The Tribunal has categorically
found, "I am constrained to observe that no material has been placed
before me nor it has been claimed in evidence that the management found that
these people were more efficient and competent than the rest of the workmen.
In the premises, I am bound to hold that I
cannot justify the promotion of the said persons named in the two references
and dispose of the first issue accordingly" (emphasis added). But to our
amazement, it failed to pass any consequential order, and instead held, "I
cannot give any relief to these workmen when their positive case is that there
is no standard or norms for giving promotion." In other words, although the
Tribunal categorically held that the actions of the management were
unjustified, it expressed, its inability to give any relief to the workmen in
the case. We do not think that the Tribunal should be so powerless. The
industrial tribunals are intended to adjudicate industrial disputes between the
management and the workmen, settle them, and pass effective awards in such a
way that industrial peace between the employers and the employees may be
maintained so that there can be more production to benefit all concerned. For
the above purpose, the industrial tribunals, as far as practicable, should not
be constrained by the formal rules of law and should avoid inability to arrive
at an effective award to meet justice in a particular dispute. The Tribunal in
the instant case, in view of its findings, first of all should have declared
that the promotions of the aforesaid fifteen persons were illegal and
unjustified, their promotions being the result of arbitrary action of the
management which was nothing but unfair labour practice, and the promotions in
question should have been cancelled.
49 The Tribunal also, in our opinion, in
consultation with the management and the union, should have framed norms/rules
of promotions and directed the management to give promotions/up gradations in
accordance with those norms/rules.
7. We do not agree with the claim of the
union that promotions or up-gradations should be on the basis of seniority
alone. The National Industrial Tribunal in its award gave the following
wholesome directions:- "I give the general formula which has been accepted
by many concerns, namely, all things being equal, seniority shall count for
promotion. If the senior person has been overlooked in the question of
promotion, he is at liberty to ask the concern for reason why he has been
overlooked, in which case the concern shall give him the reasons provided that
it does not expose the concern or the officer giving any reasons to any civil
or criminal proceedings".
The management has failed to follow this
direction in the case in hand.
Although we agree that promotion/up-gradation
is a managerial function, it must not be on the subjective satisfaction of the
management but must be on some objective criteria,
8. Mr. Pai, learned counsel appearing for the
management, made two submissions before us. Firstly, he submitted that unlike
in public sector undertakings, promotion is not a condition of service in a
private company. We are unable to accept the submission of Mr. Pai in toto. If
there is no scope of any promotion or up-gradation or increase in salary in a
private undertaking, the submission of the learned counsel may be justified but
if there are grades and scopes of upgradation/promotion and there are different
scales of pay for different grades in a private undertaking, and, in-fact,
promotion is given or up-gradation is made, there should be no arbitrary or
unjust and unreasonable up-gradation or promotion of persons superseding the
claims of persons who may be equally or even more, suitable. The second
submission of Mr. Pai is that although there were no norms, the promotions of
the persons in question were not arbitrary and that the finding of the Tribunal
in this regard were incorrect. He led us through the material evidence 50 of
the witness examined. We are unable to agree with learned counsel and do not
find any reason to differ from the findings of the learned Tribunal that the
promotions of the fifteen persons were arbitrary and unjustified. Mr. Pai also
submitted that unless victimization was proved by the union, the management's
action should not be disturbed. The word 'victimization' has not been define in
the statue. The term was considered by this Court in the case of Bharat Bank
Limited v. Employees of Bharat Bank Ltd. This Court observed, "It
(victimization) is an ordinary English word which means that a certain person
has become a victim, in other words, that he has been unjustly dealt
with". A submission was made on behalf of the management in that case that
'victimization' had acquired a special meaning in industrial disputes and
connoted a person who became the victim of the employer's wrath by reason of
his trade union activities and that the word could not relate to a person who
was merely unjustly dismissed". This submission, however, was not considered
by the Court. When, however, the word 'victimization' can be interpreted in two
different ways, the interpretation which is in favour of the labour should be
accepted as they are the poorer section of the people compared to the
management.
This Court in the case of K. C. P. Employees'
Association, Madras v. Management of K. C. P. Ltd. Madras & Ors. observed:
"In Industrial Law, interpreted and
applied in the perspective of Part IV of the Constitution, the benefit of
reasonable doubt on law and facts, if there be such doubt, must go to the
weaker section, labour. The Tribunal will dispose of the case making this
compassionate approach but without over-stepping the proved facts".
We would therefore accept the interpretation
of the word 'victimization' in the normal meaning of being the victim of unfair
and arbitrary action, and hold that there was victimization of the superseded
workmen.
9. Even if promotion may not be a condition
of service in a private company and promotion may be the function of the
manage- 51 ment, it may be recognised that there may be occasions where the
Tribunal may have to cancel the promotions made by the management where it is
felt that persons superseded have been so superseded on account of legal mala
fide or victimization (See 1966 (2) SCR 465). Although in spite of the
allegations of mala fide, the union has not been able to prove factual mala
fide, in this case malice in law and effectual victimization are obvious due to
the fact that unjustified promotions of some junior persons were made
superseding, without any reason or necessity, the cases of a large number of
senior persons.
10. As a result of the foregoing
considerations, we allow the appeals and, accepting the finding of the
Tribunal, give the following directions:
(1) The management, in consultation with the
workmen or their representatives and under the direction, supervision and
control of the Labour Commissioner of the region, shall frame norms/rules
fixing quota for the grades and for promotion/upgradation of its workmen, in
the light of the observations made above, within two months from the date of
the receipt of a copy of this judgment by the Labour Commissioner.
(2) The upgradation and/or promotion shall be
made by the management in terms of the norms/rules so framed.
(3) That meanwhile the
promotions/upgradations of Sharbashree Saroj Kumar Mukherjee, Anil Chandra
Ghose and Parameshwar Banerjee from General Grade to Special Grade clerks in
preference to the twelve workmen mentioned in Annexure 'A', which is the
subject matter of the first reference, namely, No. 3278-IR/IR/11L-13271 dated
April 2, 1974, and the promotions/upgradations of the persons mentioned in
Annexure 'A' from the General Grade to Special Grade or Supervisor Grade in
preference to the workmen mentioned in Annexure 'B', which is the subject
matter of the second reference, namely, Reference No. 7537-IR/IR/11L- 132/71
dated December 10, 1974, are cancelled; and the workmen whose promotions are
cancelled and the workmen who were superseded shall be at par with effect from
the date of this judgment till promotions/upgradations are made by the
management in terms of the norms/rules to be prepared; and no future promotions/upgradations
shall be made until the norms/rules are framed.
11. The appeals are allowed with costs.
12. Send a copy of this judgment to the
Labour Commissioner forthwith.
N. V. K. Appeals allowed.
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