Bank of
India Vs. T.S. Kelawala & Ors [1990]
INSC 187 (4 May 1990)
Sawant,
P.B. Sawant, P.B. Kuldip Singh (J)
CITATION:
1990 SCR (3) 214 1990 SCC (4) 744 JT 1990 (2) 339 1990 SCALE (1)140
ACT:
Payment
of Wages Act, 1936: Sections 7(2) and 9--Absence from work or indulging in
go-slow tactics--Pro-rata deduc- tion/non-payment of wages by employer--Whether
justified.
HEAD NOTE:
In the
former appeal, the appellant is a nationalised Bank. In 1977, some demands for
wage revision made by the employees of all Banks were pending and in support of
their demands, a call for a country wide strike was given. The appellant-Bank
issued a Circular on September
23, 1977 to its
managers and agents directing them to deduct wages of the employees for the
days they go on strike. The respondent Unions gave a car for a four hour strike
on December 29, 1977. Two days before the strike, the
appellant-Bank issued an Administrative Circular warning the employees that if
they participate in the strike, they would be committing a breach of their
contract of service and they would not be entitled to salary for the full day
and they need not report for work for the rest of the working hours on that
day.
However,
the employees went on strike as scheduled, for four hours which included
banking hours of the public, and re- sumed duty thereafter. The appellant-Bank
did not prevent them from doing so. The appellant Bank by its circular di- rected
the managers and agents to deduct the full day's salary of those employees who
participated in the strike. On a writ petition filed by the respondents, the
High Court quashed the said Circular. The Letters Patent Appeal filed by the
appellant was dismissed. Hence, the appeal by the Bank.
In the
latter appeal, the appellant is a company whose workers had indulged in
"go-slow" in July 1984, thereby bringing down production. The workers
did not attend to their work and were loitering in the premises and were
indulging in go-slow tactics to pressurise the 215 company to concede their
demands. The company suspended its operation by giving a notice of lock out. It
did not pay wages to the workers for July , 1984 on the ground that they did
not work during all the working hours and had not their wags. The workers'
union filed a complaint before the Indus- trial Court complaining that the
appellant company had indulged in unfair labour practice and that the lock-out
declared was illegal- The Industrial Court held that the deduction of wages for
July, 1984 on account of the go-slow was not justified- It also declared that
the company had committed an unfair labour practice by not paying full monthly
wages to the workers and directed the company to pay the said wages for the
month of July, 1984. Aggrieved, the appellant company has preferred the appeal.
Allowing
the appeals, this Court,
HELD:
1.1 There is no doubt that whenever a worker indulges in a misconduct such as a
deliberate refusal to work, the employer can take disciplinary action against
him and impose on him the penalty prescribed for it which may include some
deduction from his wages. However, when miscon- duct is not disputed but is, on
the other band, ' admitted and is resorted to on a mass scale such as when the
employ- ees go on strike, legal or illegal, there is no need to hold an
inquiry. To insist on an inquiry even in such cases is to pervert the very
object of the inquiry. In a mass action such as strike it is not possible to
hold an inquiry against every employee nor is it necessary to do so unless, of
course, an employee contends that although he did not want to go on strike and
wanted to resume his duty, he was pre- vented from doing so by the other
employees or that the employer did not give him proper assistance to resume his
duty though he had asked for it. That was certainly not the situation in the
present case in respect of any of the employees and that is not the contention
of the employees either. It is true that in the present case when the employ- ees
came back to work after their four-hours strike, they were not prevented from
entering the Bank premises. But admittedly, their attendance after the four-hours
strike was useless because there was no work to do during the rest of the
hours. It is for this reason that the Bank had made it clear, in advance, that
if they went on strike for the four-hours as threatened, they would not be
entitled to the wages for the whole day and hence they need not report for work
thereafter- Short of physically preventing the employ- ees from resuming the
work which it was unnecessary to do, the Bank had done all hi its power to warn
the employees of the consequences of their action and if the employees, in
spite of it, chose to enter the Bank's premises where they had no work to do,
and in fact did not 216 do any, they did so of their own choice and not
according to the requirement of the service or at the direction of the Bank. In
fact, the direction was to the contrary. Hence, the later resumption of work by
the employees was not in fulfil- ment of the contract of service or any
obligation under it.
The
Bank was therefore not liable to pay either full day's salary or even the pro
rata salary for the hours or work that the employees remained in the Bank
premises without doing any work. It is not a mere presence of the workmen at
the place of work but the work that they do according to the terms of the
contract which constitutes the fulfilment of the contract of employment and for
which they were entitled to be paid. [222E-H; 223A-F]
1.2
Although the service regulations do not provide for a situation where employees
on a mass scale resort to ab- sence from duty for whole day or a part of the
day whether during crucial hours or otherwise they do provide for treat- ing an
absence from duty of an individual employee as a misconduct and for taking
appropriate action against him for such absence. [224D-E]
2.1.
When the contract, Standing Orders, or the service rules/ regulations are
silent, but enactment such as the payment of Wages Act providing for wage-cuts
for the absence from duty is applicable to the establishment concerned, the
wages can be deducted even under the provisions of such enactment. [231F]
2.2.
The working class has indisputably earned the right to strike as an industrial
action after a long struggle, so much so that the relevant industrial legislation
recognises it as their implied right. However, the legislation also
circumscribes this right by prescribing conditions under which alone its
exercise may become legal. Whereas, there- fore, a legal strike may not invite
disciplinary proceed- ings, an illegal strike may do so, it being a misconduct.
However,
whether the strike is legal or illegal, the workers are liable to lose wages
for the period of strike. The liability to lose wages does not either make the
strike illegal as a weapon or deprive the workers of it. When workers resort to
it, they do so knowing full well its consequences. During the period of strike
the contract of employment continues but the workers withhold their labour.
Consequently,
they cannot expect to be paid. [232C-E]
2.3.
The contract, which is this case is monthly, cannot be subdivided into days and
hours. If the contract comes to an end amidst a month by death, resignation or
retirement of the employee, he would not be entitled to the proportionate
payment for the part of the month 217 he served. If the employment-contract is
held indivisible, it will be so for both the parties. There is no difficulty,
inequity or impracticability in construing the contract as divisible into
different periods such as days and hours for proportionate reimbursement or
deduction of wages, which is normally done in practice. [232G-H; 233A]
2.4.
The contract of employment, Standing Orders or the service rules provide for
disciplinary proceedings for the lapse on the part of a particular individual
or individuals when the misconduct is disputed. As things stand today, they do
not provide a remedy for mass-misconduct which is admit- ted or cannot be
disputed. Hence, to drive the management to hold disciplinary proceedings even
in such cases is neither necessary nor proper. The service conditions are not
expect- ed to visualise and provide for all situations. When they are silent on
unexpected eventualities, the management should be deemed to have the requisite
power to deal with them consistent with law and the other service conditions
and to the extent it is reasonably necessary to do so. The pro rata deduction
of wages is not an unreasonable exercise of power on such occasions. Whether on
such occasions, the wages are deductable at all and to what extent will, howev-
er, depend on the facts of each case. Although the employees may strike only
for some hours but there is no work for the rest of the day as in the present
case, the employer may be justified in deducting salary for the whole day. On
the other hand, the employees may put in work after the strike hours and the
employer may accept it or acquiense in it. In that case the employer may not be
entitled to deduct wages at all or be entitled to deduct only for the hours of
strike. If statutes such as the Payment of Wages Act or the State enactments
like the Shops and Establishments Act apply, the employer ,may be justified in
deducting wages under their provisions. Even if they do not apply, nothing
prevents the employer from taking guidance from the legisla- tive wisdom
contained in it to adopt measures on the lines outlined therein, when the
contract of employment is silent on the subject. [233B-F] V.T. Khanzode &
Ors. v. Reserve Bank of India & Anr., [1982] 3 SCR 411; Paluru Ramkrishnaiah
& Ors. etc. v. Union of India & Anr. etc., [1989] 1
JT 595 and Senior Superin- tendent of Post Office & Ors. v. lzhar Hussain,
[1989] 3 JT 411, relied on.
Buckingham
and Carnatic Co. Ltd. v. Workers of the Buckingham and Carnatic Co. Ltd.,
[1953] SCR 219; V. Ganesan v. The State Bank of India & Ors., [1981] 1 LLJ
64; State Bank of India, Canara Bank, Central Bank etc.
& Ors. v. Ganesan, Jambunathan, Venkatara- 218 man, B.V. Kamath, V.K.
Krishnamurthy, etc. & Ors., [1989] 1 LLJ 109; Sukumar Bandyopadhyyay &
Ors. v. State of West Bengal & Ors., [1976] IX LIC 1689; Algemene Bank
Nederland, N.V. v. Central Government Labour Court, Calcutta & Ors., [1978]
II LLJ, 117; V. Ramachandran v. Indian Bank, [1979] I LLJ 122; Dharam Singh Rajput
& Ors. v. Bank of India, Bombay & Ors., [1979] 12 LIC 1079; R. Rajamanickam,
for himself and on behalf of other Award Staff v. Indian Bank, [1981] II LLJ
367; R.N. Shenoy & Anr. etc. v. Central Bank of India & Ors. etc.,
[1984] XVII LIC 1493; Prakash Chandra Johari v. Indian Overseas Bank & Anr.,
[1986] II LLJ 496; Workmen of M/s. Firestone Tyre & Rubber Co. of India (P)
Ltd. v. Firestone Tyre & Rubber Co., [1976] 3 SCR 369; Krishnatosh Das
Gupta v. Union of India & Ors., [1980] 1 LLJ
42; Sant Ram Sharma v. State of Rajasthan & Anr., [1968] 1 SCR 111; Roshan Lal
Tandon v. Union of India, [1968] 1 SCR 185; Secretary of State for Employment v.
Associated Society of Locomotive Engineers and Firemen and Ors. (No. 2), [1972]
2 All ER 949; Miles v. Wakefield Metropolitan District Council, [1989] I LLJ
335 and Cutter v. Pwell, [1795] 6 TR 320, referred to.
3.1.
There cannot be two opinions that go-slow is a serious misconduct being a
covert and a more damaging breach of the contract of employment. It is an
insidious method of undermining discipline and at the same time a crude device
to defy the norms of work. It has been roundly condemned as an industrial
action and has not been recognised as a legit- imate weapon of the workmen to
redress their grievances. In fact the model standing orders as well as the
certified standing orders of most of the industrial establishments define it as
a misconduct and provide for disciplinary action for it. Hence, once it is
proved. those guilty of it have to face the consequences which may include
deduction of wages and even dismissal from service. [237G-H; 238A]
3.2.
The proof of go-slow, particularly when it is disputed, involves investigation
into various aspects such as the nature of the process of production, the
stages of production and their relative importance, the role of the workers
engaged at each stage of production, the pre-produc- tion activities and the
facilities for production and the activities of the workmen connected therewith
and their effect on production, the factors hearing on the average production
etc. The go-slow further may be indulged in by an individual workman or only
some workmen either in one sec- tion or different sections or in one shift or
both shifts affecting the output in varying degrees and to different extent
depending upon the nature of product and the produc- tive process. Even where
it is admitted, go-slow may in some case present 219 difficulties in
determining the actual or approximate loss, for it may have repercussions on
production after the go- slow ceases which may be difficult to estimate. The deduc-
tion of wages for go-slow may, therefore, present difficul- ties which may not
be easily resoluble. When, therefore, wages are sought to be deducted for
breach of contract on account of go-slow, the quantum of deduction may become a
bone of contention in most of the cases inevitably leading to an industrial
dispute to he adjudicated by an independent machinery statutory or otherwise as
the parties may resort to. The simplistic method of deducting uniform percentage
of wages from the wages of all workmen calculated on the basis of the
percentage fail in production compared to the normal or average production may
not always be equitable. It is, therefore, necessary that in all cases where
the factum of go-slow and/or the extent of the loss of production on account of
it, is disputed, there should he a proper inquiry on charges which furnish
particulars of the go-slow and the loss of production on that account. The
rules of natural justice require it, and whether they have been followed or not
will depend on the facts of each case. [238B-G]
3.3.
In the instant case, there is a finding recorded by the Industrial Court that there was a go-slow resorted
to by the workmen resulting in loss of production during the said period. Since
the said finding is not challenged, it is not possible to interfere with it in
this appeal. Though the appellant is justified in deducting wages for the said
period, in the facts and circumstances of the case it is directed that it will
not deduct more than 5 per cent of the wages of the workmen for the month of
July, 1984 when they indulged in go-slow tactics. [239D-F] M/s. Bharat Sugar
Mills Ltd. v. Shri Jai Singh & Ors., [1962] 3 SCR 684; T.S. Kelwala &
Ors. v. Bank of India & Ors., [1981] 43 FLR 341 and Apar (Pvt) Ltd. v.S.R. Samant
& Ors., [1980] II LLJ 344, referred to.
CIVIL
APPELLATE JURISDICTION: Civil Appeal No. 2581 of 1986.
Appeal
by Certificate from the Judgment and Order dated 15.10.1985 of the Bombay High
Court in Appeal No. 547 of 1984.
WITH Civil
Appeal No. 855 of 1987.
220
From the Judgment and Order dated 8.12.1986 of the Industrial Court, Maharashtra, Bombay in Complaint (ULP) No. 1202 of
1984.
Ashok
Desai, Attorney General, G.B. Pai, J. Ramamurthy, Jitendra Sharma, B.N. Dutt,
H.S. Parihar, Vipin Chandra, R.F. Nariman, P.H. Parekh, N.K. Sahu, Mrs. Urmila Sirur
and Raj Birbal for the appearing parties.
The
Judgment of the Court was delivered by SAWANT, J. These are two appeals
involving a common question of law, viz., whether an employer has a right to
deduct wages unilaterally and without holding an enquiry for the period the
employees go on strike or resort to go-slow.
In CA
No. 2581 of 1986 we are concerned with the case of a strike while in the other
appeal, it is a,case of a go-slow.
By
their very nature, the facts in the two appeals differ, though the principles
of law involved and many of the au- thorities to be considered in both cases
may be the same.
For
the sake of convenience, however, we propose to deal with each case separately
to the extent of the distinction.
Civil
Appeal No. 2581 of 1986
2. The
appellant in this case is a nationalised bank, and respondents 1 and 2 are its
employees whereas respond- ents 3 and 4 are the Unions representing the
employees of the Bank. It appears that some demands for wage-revision made by
the employees of all the banks were pending at the relevant time, and in
support of the said demands the All India Bank Employees' Association had given
a call for a countrywide strike. The appellant-Bank issued a circular on
September 23, 1977 to all its managers and agents to deduct wages of the
employees who would participate in the strike for the days they go on strike.
Respondents 3 and 4, i.e., the employees' Unions gave a call for a four-hours
strike on December 29, 1977. Hence, the Bank on December 27, 1977 issued an
Administrative Circular warning the employees that they would be committing a
breach of their contract of service if they participated in the strike and that
they would not be entitled to draw the salary for the full day if they did so,
and consequently, they need not report for work for the rest of the working
hours on that day. Notwithstand- ing it, the employees went on a four hours
strike from the beginning of the working hours on 29th December 1977. There is
no dispute that the banking-hours for the public covered the said four hours.
The employees, however, resumed 221 work on that day after the strike hours,
and the Bank did not prevent them from doing so. On January 16, 1978, the Bank
issued a Circular directing its managers and agents to deduct the full day's
salary of those of the employees who had participated in the strike. The
respondents filed a writ petition in the High Court for quashing the circular.
The petition was allowed. The Bank preferred a Letters Patent Appeal in the
High Court which also came to be dismissed.
Hence,
the present appeal.
The
High Court has taken the view, firstly, that neither regulations nor awards nor
settlements empowered the Bank to make the deductions, and secondly, in
justice, equity and good conscience the Bank could not by the dictate of the
impugned circular attempt to stifle the legitimate weapon given by the law to
the workers to ventilate their griev- ances by resorting to strike. The High
Court further took the view that since strikes and demonstrations were not
banned in the country and despite the inconvenience that they may cause, they
were recognised as a legitimate form of protest for the workers, the circular
acted as a deterrent to the employees from resorting to a legally recognised
mode of protest. According to the High Court, the circular even acted as an
expedient to stifle the legitimate mode of protest allowed and recognised by
law. The deduction of the wages for the day according to the Court amounted to unilat-
erally changing the service conditions depriving the workers of their fixed
monthly wages under the contract of service.
The
Court also reasoned that under the conditions of serv- ice, wages were paid not
from day to day or hour to hour but as a fixed sum on a monthly basis. The
contract between the Bank and the workers being not a divisible one, in the
absence of a specific term in the regulations, awards and settlements, the Bank
could not unilaterally reduce the monthly wage and thus give the employees
lesser monthly wages than the one contracted. The non-observance by the
employees of the terms of the contract may give the employer a cause of action
and a right to take appropriate remedy for the breach, but the employer was not
entitled to deduct any part of the wages either on a pro rata basis or
otherwise.
The
High Court further opined that the Bank was not without a remedy and the
employees cannot hold the bank to ransom.
The
Bank could get the four-hours strike declared illegal by recourse to the
machinery provided by law or put the erring workers under suspension for minor
misconduct under Regula- tion 19.7, hold an enquiry and if found guilty, impose
punishment of warning, censure, adverse remarks or stoppage of increment for
not more than six months as prescribed by Regulation 19.8. The High Court also
rejected the contention of the Bank that the Bank was entitled to make 222
deductions under Section 7(2) of the Payment of Wages Act, 1936 by holding that
the provision enabled the employer to deduct wages only if the Bank had power
under the contract of employment.
4. The
principal question involved in the case, accord- ing to us, is, notwithstanding
the absence of a term in the contract of employment or of a provision in the
service rules or regulations, whether an employer is entitled to deduct wages
for the period that the employees refuse to work although the work is offered
to them. The deliberate refusal to work may be the result of various actions on
their part such as a sit-in or stay-in strike at the work- place or a strike
whether legal or illegal, or a go-slow tactics. The deliberate refusal to work
further may be legal or illegal as when the employees go on a legal or illegal
strike. The legality of strike does not always exempt the employees from the
deduction of their salaries for the period of strike. It only saves them from a
disciplinary action since a legal strike is recognised as a legitimate weapon
in the hands of the workers to redress their griev- ances. It appears to us
that this confusion between the strike as a legitimate weapon in the hands of
the workmen and the liability of deduction of wages incurred on account of it,
whether the strike is legal or illegal, has been responsible for the approach
the High Court has taken in the matter.
5. It
is necessary to clear yet another misconception.
There
is no doubt that whenever a worker indulges in a misconduct such as a
deliberate refusal to work, the employ- er can take a disciplinary action
against him and impose on him the penalty prescribed for it which may include
some deduction from his wages. However, when misconduct is not disputed but is,
on the other hand, admitted and is resorted to on a mass scale such as when the
employees go on strike, legal or illegal, there is no need to hold an inquiry.
To insist on an inquiry even in such cases is to pervert the very object of the
inquiry. In a mass action such as a strike it is not possible to hold an
inquiry against every employee nor is it necessary to do so unless, of course,
an employee contends that although he did not want to go on strike and wanted
to resume his duty, he was prevented from doing so by the other employees or
that the employer did not give him proper assistance to resume his duty though
he had asked for it. That was certainly not the situation in the present case
in respect of any of the employees and that is not the contention of the
employees either. Hence, in cases such as the present one, the only question
that has to be considered is whether, when admittedly the employees refuse to
work by going on strike, the employer is entitled to deduct wages for the
relevant period or not. We 223 thought that the answer to this question was
apparent enough and did not require much discussion. However, the question has
assumed a different dimension in the present case be- cause on the facts, it is
contended that although the em- ployees went on strike only for four hours and
thereafter resumed their duties, the Bank has deducted wages for the whole day.
It is contended that in any case this was imper- missible and the Bank could at
the most deduct only pro rata wages. Normally, this contention on the part of
the workers would be valid. But in a case such as the present one, where the
employees go on strike during the crucial working hours which generate work for
the rest of the day, to accept this argument is in effect to negate the purpose
and efficacy of the remedy, and to permit its circumvention effectively. It is
true that in the present case when the employees came back to work after their four-hours
strike, they were not prevented from entering the Bank premises. But
admittedly, their attendance after the four-hours strike was useless because
there was no work to do during the rest of the hours. It is for this reason
that the Bank had made it clear, in advance, that if they went on strike for
the four-hours as threatended, they would not be entitled to the wages for the
whole day and hence they need not report for work thereafter. Short of
physically preventing the employ- ees from resuming the work which it was
unnecessary to do, the Bank had done all in its power to warn the employees of
the consequences of their action and if the employees, in spite of it, chose to
enter the Bank's premises where they had no work to do, and in fact did not do
any, they did so of their own choice and not according to the requirement of
the service or at the direction of the Bank. In fact, the direction was to the
contrary. Hence, the later resumption of work by the employees was not in fulfilment
of the con- tract of service or any obligation under it. The Bank was therefore
not liable to pay either full day's salary or even the pro rata salary for the
hours of work that the employees remained in the Bank premises without doing
any work. It is not a mere presence of the workmen at the place of work but the
work that they do according to the terms of the contract which constitutes the fulfilment
of the contract of employ- ment and for which they are entitled to be paid.
6. It
is also necessary to state that though, before the High Court, reliance was
placed by the Bank on the provi- sions of Section 7(2)(b) read with Section 9
of the Payment of Wages Act, 1936 for a right to deduct the wages for absence
from duty, there is nothing on record to show that the provisions of the said
Act have been made applicable to the Bank. However, assuming that Act was
applicable to the Bank, we are of the opinion that the relevant discussion of
the 224 High Court has missed the contentions urged by the Bank on the basis of
the said provisions. What was urged by the Bank was that the said provisions
enabled it to deduct wages for absence from duty. Hence, even if the Service
rules/regula- tions were silent on the point, the Bank could legally deduct the
wages under the said provisions. The High Court has reasoned that the power
given by the said provisions come into play only when the employer has power to
do so, probably meaning thereby, the power under the Service rules/regulations.
We are unable to appreciate this reason- ing, which to say the least, begs the
question. It is, therefore, necessary to point out that if the Act was ap- plicable,
the Bank would certainly have had the power to deduct the wages under the said
provisions in the absence of any service rule regulation to govern the
situation.
7.
Since the admitted position is that the service rules do not provide for such a
situation, the question as stated earlier which requires to be answered in the
present case, is whether there exists an implied right in the employer- Bank to
take action as it has done. There is no dispute that although the service
regulations do not provide for a situa- tion where employees on a mass scale
resort to absence from duty for whole day or a part of the day whether during
crucial hours or otherwise, they do provide for treating an absence from duty
of an individual employee as a misconduct and for taking appropriate action
against him for such absence. Since the High Court has indicated a disciplinary
action under the said provision even in the present circum- stances, we will
also have to deal with that aspect. But before we do so, we may examine the
relevant authorities cited at the Bar.
8. In
Buckingham and Carnatic Co. Ltd. v. Workers of the Buckingham and Carnatic Co.
Ltd., [1953] SCR 219 the facts were that on 1st November, 1948 the night-shift
operatives of the carding and spinning department of the appellant- Mills
stopped work, some at 4 p.m., some at 4.30 p.m. and some at 5 p.m. and the
stoppage ended at 8 p.m. in both the departments, and at 10 p.m. the strike
ended completely. The apparent cause for the strike was that the management of
the Mills had expressed its inability to comply with the request of the workers
to declare the forenoon of the 1st November, 1948 as a holiday for solar-eclipse. On 3rd November, 1948, the management
put up a notice that the stoppage of work on the 1st November amounted to an
illegal strike and a break in service within the meaning of the Factories Act
and that the management had decided that the workers who had partici- pated in
the said strike would not be entitled to holidays with pay as provided by the
Act. The disputes having thus arisen, 225 the State Government referred the
matter to Industrial Tribunal. The Tribunal held that the workers had resorted
to an illegal strike and upheld the view of the management that the continuity
of service of the workers was broken by the interruption caused by the illegal
strike and as a result the' workers were not entitled to annual holidays with
pay under Section 49-B(1) of the Factories Act. The Tribunal, however, held
that the total deprivation of leave with pay was a severe punishment and
reduced the punishment by 50 per cent and held that the workers would be
deprived of only half their holidays with pay. In the appeal before the then Labour
Appellate Tribunal, the Tribunal held, among other things, that what happened
on the night of the 1st November did not amount to a strike and did not cause
any interrup- tion in the workers' service. The Tribunal observed that "It
would be absurd to hold that non-permitted absence from work even for half an
hour or less in the course of a working day would be regarded as interruption
of service of a workman for the purpose of the said section (i.e., Section
49-B(1) of the Factories Act). We are inclined to hold that the stoppage of
work for the period for about 2 to 4 hours in the circumstances of the ease is
not to be regarded as a strike so as to amount to a break in the continuity of
service of the workman concerned". In the result, the Tribu- nal allowed
the Union's appeal and ordered that holidays
at full rates as provided for in Section 49-A of the Factories Act will have to
be calculated on the footing that there was no break in the continuity of
service. This Court set aside the finding of the Appellate Tribunal by holding
that it could not be disputed that there was a cessation of work by a body of
persons employed in the Mills and that they were acting in combination and
their refusal to go back to work was concerted, and the necessary ingredients
of the defini- tion of "strike" in Section 2 (q) of the Industrial
Disputes Act existed and it was not a ease of an individual worker's failure to
turn up for work. Hence, it was an illegal strike because no notice had been
given to the management, the Mills being a public utility industry.
In
Secretary of State for Employment v. Associated Society of Locomotive Engineers
and Firemen and Ors. (No. 2), [1977] 2 All ER 949, Lord Denning MR observed:
"...It
is equally the case when he is employed as one of many's to work in an
undertaking which needs the service of all. If he, with the others, takes steps
wilfully to disrupt the undertaking to produce chaos so that it will not run as
it should. then each one who is a party to those steps is guilty 226 of a
breach of his contract. It is no answer for any one of them to say 'I am only
obeying the rule book', or 'I am not bound to-do more than a 40 hour week'.
That would be all very well if done in good faith without any wilful disrup- tion
of services; but what makes it wrong is the object with which it is done. There
are many branches of our law when an act which would otherwise be lawful is
rendered unlawful by the motive or object with which it is done. So here it is
the wilful disruption which is the breach. It means that the work of each man
goes for naught. It is made of no effect. I ask: is a man to be entitled to
wages for his work when he, with others, is doing his best to make it useless? Surely
not. Wages are to be paid for services rendered, not for producing deliberate
chaos. The breach goes to the whole of the consideration, as was put by Lord
Campbell CJ in Cuckson v. Stones, [1858] 1 E & E 248 at 255, (1983-60) All
ER Rep 390 at 392 and with other cases quoted in Smith's Leading Cases (13th Edn.,
Vol. 2, p. 48), the notes to Cutter v. Power, [1795] 6 Term Rep 320, (1775-1802)All
ER Rep 159)".
In
Miles v. Wakefield Metropolitan District Council, [ 1989] I LLJ 335 the facts
were that the plaintiff, Miles was the Superintendent Registrar in the
Wakefield Metropolitan District Council. His duties included performing
marriages.
As
part of trade union action, he declined to perform mar- riages on Saturdays
which day was very popular with marrying couples. However, on that day he
performed his other duties.
The
Council, not wanting to terminate his services, imposed a cut in his
remuneration. He sued the Council for payment but failed. He appealed to the
Court of Appeal and was successful. The appellate court held that he was a
statutory official and there was no contractual relation and the only action
against him was dismissal. Aggrieved by this appel- late decision, the Council
went before the House of-Lords in appeal. The House of Lords held that the
salary payable to the plaintiff was not an honorarium for the mere tenure of
office but had the character of remuneration for work done.
If an
employee refused to perform the full duties which could be required of him
under his contract of service, the employer is entitled to refuse to accept any
partial per- formance. In an action by an employee to recover his pay, it must
be proved or admitted that the employee worked or was willing to work in accordance
with the contract of employ- ment or that such service as was given by the
employee, if falling short of. his contractual obligations was accepted by the
227 employer as sufficient performance of the contract. In a contract of
employment wages and work go together. The employer pays for the work and the
worker works for his wages. If the employer declines to pay, the worker need
not work. If the worker declines to work, the employer need not pay- In an
action by a worker to recover his pay, he must allege and prove that he worked
or was willing to work. In the instant case, the plaintiff disentitled himself
to salary for Saturday morning because he declined to work on Saturday morning
in accordance with his duty. Since the employee had offered only partial
performance of his con- tract, the employer was entitled, without terminating
the contract of employment, to decline partial performance, and in that case
the employee would not be entitled to sue for his unwanted service.
In
this connection, Lord Templeman stated as follows:
"The
consequences of counsel's submissions demonstrate that his analysis of a
contract of employment is deficient. It cannot be right that an employer should
be compelled to pay something for nothing whether he dismisses or retains a
worker. In a contract of employment wages and work go together. The employer
pays for work and the worker works for his wages. If the employer declines to
pay, the worker need not work. If the worker declines to work, the employer
need not pay. In an action by a worker to recover his pay he must allege and be
ready to prove that he worked or was willing to work ..... " It may be
mentioned here that on the question whether the employee engaged in some kind
of industrial action can claim wages on the basis of quantum meruit, only two
of the Law Lords expressed themselves in favour, while the other three did not
want to express any definite opinion on the question.
9. Among
the decisions of the various High Courts relied upon by the parties in support
of the respective cass, we find that except for the decision in V. Ganesan v.
The State Bank of India & Ors., [1981] 1 LLJ 64 given by the learned Single
Judge of the Madras High Court and the deci- sion of the Division Bench of the
same Court in that matter and other matters decided together in State Bank of
India, Canara Bank, Central Bank etc. & Ors. v. Ganesan,-Jambuna- than, Venkataraman,
B.V. Kamath, V.K. Krishnamurthy, etc. & Ors., [1989] 1 LLJ 109, all other
decisions, namely,
(i) Sukumar
Bandyo- 228 padhyyay & Ors. v. State of West Bengal & Ors., [1976] IXLIC 1689;
(ii) Algemene
Bank Nederland, N.V. v. Central Govern- ment Labour Court, Calcutta & Ors.,
[1978] II LLJ, 117;
(iii)
V. Ramachandran v. Indian Bank, [1979] 1 LLJ 122;
(iv) Dharam
Singh Rajput & Ors. v. Bank of India, Bombay & Ors., [1979]12 LIC 1079;
(v) R.
Rajamanickam, for himself and on behalf of other Award Staff v. Indian Bank,
[1981] II LLJ 367;
(vi)
R.N. Shenoy & Anr. etc. v. Central Bank of India & Ors. etc., [1984]
XVII LIC 1493 and
(vii) Prakash
Chandra Johari v. Indian Overseas Bank & Anr. [1986] II LI J 496, have
variously taken the view that it is not only permissi- ble for the employer to
deduct wages for the hours or the days for which the employees are absent from
duty but in cases such as the present, it is permissible to deduct wages for
the whole day even if the absence is for a few hours. It is also held that the
contract is not indivisible. Some of the decisions have also held that the
deduction of wages can also be made under the provisions of the Payment of
Wages Act and similar statutes where they are applicable. It is further held
that deduction of wages in such cases is not a penalty but is in enforcement of
the contract of employment and hence no disciplinary proceedings need precede
it.
Even
in V. Ganesan v. The State Bank of India & Ors., (supra), it was not
disputed on behalf of the employees that the employer, namely, the Bank had no
fight to deduct pro rata the salary of the officers for the period of absence
from duty. What was contended there was that the Bank was not entitled to
deduct the salary for the whole three days on which the employees had staged a
demonstration for a duration of 30 minutes during working hours on two days and
for an hour, on the third day. The learned Judge held that by permitting the
employees to perform their work during the rest of the day and by accepting
such performance the bank must be deemed to have acquiesced in the breach of
contract by the employees. It is on this fact that the learned Judge held that
the right to deduct salary (obviously for the whole day) on the principle of
"no work no pay" could be exercised only when there was a term in the
contract or when there was a statutory provision to that effect. The Division
Bench of the said Court in appeal against the said decision and similar other
matters (supra) confirmed the reasoning of the learned Judge and held that in
the absence of either a term in the contract of service stipulating that if an
employee abstains from doing a particular work on a particu- lar day, he would
not be entitled to emoluments for the whole day or in the absence of a
statutory provision laying down such a rule, it was impermissible for the
employer to deduct or withhold the emoluments 229 of the employees even for the
hours during which they worked. Having accepted the performance of work from
the employees for the rest of the day, the Banks are bound to compensate the
employees for the work performed by them. In that very case, the Court also
held, on the facts arising from the other matters before it, that the refusal
to per- form the clearing-house work can only be the subject matter of a
disciplinary action and it cannot straightaway result in the withholding of the
wages for the whole day. Non- signing of the attendance register and doing work
is also work for which the employees should be compensated by pay- ment of
remuneration.
10. On
the specific question whether the management can take action in situations,
where either the contract, Stand- ing Order or rules and regulations are
silent, both parties relied on further authorities.
In
Workmen of M/s. Firestone Tyre & Rubber Co. of India (P) Limited v.
Firestone Tyre & Rubber Co., [1976] 3 SCR 369 on which reliance was placed
on behalf of the workmen it was held that under the general law of master and
servant, an employer may discharge an employee either temporarily or
permanently but that cannot be without adequate notice. Mere refusal or
inability to give employment to the workmen when he reports for duty, on one or
more grounds mentioned in clause (kkk) of Section 2 of the Industrial Disputes
Act is not a temporary discharge of the workmen. Such a power, therefore, must
be found out from the terms of the contract of service or the Standing Orders
governing the establish- ment- Hence, even for lay-off of the workmen there
must be a power in the management either in the contract of service or the
standing orders governing the establishment. Ordinarily, the workmen,
therefore, would be entitled to their full wages when the workmen are laid off
without there being any such power. There was no common law right to lay off
the workmen, and, therefore, no right to deny the workmen their full wages.
In Krishnatosh
Das Gupta v. Union of India & Ors., [1980] 1 LLJ 42, it was a case of the
employees of the National Test House, Calcutta who had staged demonstration
after signing the attendance register to register their protest against
suspension of some of their colleagues.
Though
the employees signed the attendance register and attended the office, they did
no work on the relevant day.
As
such, a circular was issued by the Joint Director inform- ing the employees
that they would be considered as "not on duty". By a subsequent
circular the same Joint Director notified to all departments concerned the
decision of the Cabinet that there shall not be pay for no work. Relying on the
said 230 circular the Management of the National Test House effected on a
mass-scale pay-cut from the pay and allowances of the concerned employees. The
circular was challenged by the employees by a writ petition before the High
Court. The High Court held that in order to deduct any amount from salary,
there must be specific rules relating to the contract of service of the person
concerned.
On
behalf of the employers, reliance was placed on a decision of this Court in Sant
Ram Sharma v. State of Rajas- than & Anr., [1968] 1 SCR 111 for the
proposition laid down there.that in the absence of any statutory rules or a spe-
cific provision in the rules, the Government can act by administrative
instructions. The Court has held there that though it is true that the
Government cannot amend or super- sede statutory rules by administrative
instructions, if the rules are silent on any particular point, Government can
fill up the gaps and supplement the rules and issue instruc- tions not
inconsistent with the rules already framed.
In Roshan
Lal Tandon v. Union of India, [1968] 1 SCR 185, this Court has stated that
although the origin of Government service is contractual in the sense that
there is an offer and acceptance in every case, once appointed to his post or
office, the Government servant acquires a status, and his rights and
obligations are no longer determined by consent of both parties but by statute
or statutory rules which may be flamed or altered unilaterally by the Govern- ment.
In other words, the legal position of the Government servant is more of status
than of contract. The hallmark of status is the attachment to legal
relationship of rights and duties imposed by the public law and not by mere
agreement of the parties. The relationship between the Government and the
servant is not like an ordinary contract of service between a master and
servant. The legal relationship is something entirely different, something in
the nature of status.
In
V.T. Khanzode & Ors. v. Reserve Bank of India & Anr., [1982] 3 SCR 411,
this Court has reiterated that so long as Staff Regulations are not flamed, it
is open to issue admin- istrative circulars regulating the service conditions
in the exercise of power conferred by Section 7(2) of the Reserve Bank of India
Act, 1934 so long as they do not impinge on any regulations made under Section
58 of the Act.
The
same view with regard to power to issue administra- tive instructions when
rules are silent on a subject has been reiterated by the Court in Paluru Ramkrishnaiah
& Ors. etc. v. Union of India & 231 Anr. etc., [1989] 1 JT 595 and in Senior
Superintendent of Post Office & Ors. v. Izhar Hussain, [1989] 3 JT 411.
11.
The principles which emerge from the aforesaid authorities may now by stated.
Where the contract, Standing Orders or the service rules/regulations are silent
on the subject, the management has the power to deduct wages for absence from
duty when the absence is a concerted action on the part of the employees and
the absence is not disputed.
Whether
the deduction from wages will be pro rata for the period of absence only or
will be for a longer period will depend upon the facts of each case such as
whether where was any work to be done in the said period, whether the work was
in fact done and whether it was accepted and acquiesced in, etc.
It is
not enough that the employees attend the place of work. They must put in the
work allotted to them. It is for the work and not for their mere attendance
that the wages/salaries are paid. For the same reason, if the employ- ees put
in the allotted work but do not, for some reason--may be even as a
protest--comply with the formali- ties such as signing the attendance register,
no deduction can be effected from their wages- When there is a dispute as to
whether the employees attended the place of work or put in the allotted work or
not, and if they have not, the reasons therefore etc., the dispute has to be
investigated by holding an inquiry into the matter. In such cases, no deduction
from the wages can be made without establishing the omission and/or commission
on the part of the employees concerned.
When
the contract, Standing Orders, or the service rules/regulations are silent, but
enactment such as the Payment of Wages Act providing for wage-cuts for the
absence from duty is applicable to the establishment concerned, the wages can
be deducted even under the provisions of such enactment.
12.
Apart from the aforesaid ratio of the decisions and the provisions of the
Payment of Wages Act and similar statutes on the subject, according to us, the
relevant provisions of the major legislation governing the industrial disputes,
viz., the InduStrial Disputes Act, 1947 also lend their support to the view
that the wages are payable pro rata for the work done and hence deductible for
the work not done. Section 2 (rr) of the said Act defines "wages" to
mean "all remuneration .... which would, if terms of employ- ment,
expressed or implied, were fulfilled, be payable to workman in respect of his
employment or work done in such employment ..." while Section 232 2(q)
defines "strike" to mean "cessation of work" or "refus-
al to continue to work or accept employment by workman".
Reading
the two definitions together, it is clear that wages are payable only if the
contract of employment is fulfilled and not otherwise. Hence, when the workers
do not put in the allotted work or refuse to do it, they would not be entitled
to the wages proportionately.
13.
The decisions including the one impugned in this appeal which have taken the
view which is either contrary to or inconsistent with the above conclusions,
have done so because they have proceeded on certain wrong presumptions.
The
first error, as we have pointed out at the outset, is to confuse the question
of the legitimacy of the strike as a weapon in the workers' hands with that of
the liability to lose wages for the period of strike. The working class has
indisputably earned the right to strike as an industrial action after a long
struggle, so much so that the relevant industrial legislation recognises it as
their implied right.
However,
the legislation also circumscribes this right by prescribing conditions under
which alone its exercise may become legal. Whereas, therefore, a legal strike
may not invite disciplinary proceedings, an illegal strike may do so, it being a
misconduct. However, whether the strike is legal or illegal, the workers are
liable to lose wages for the period of strike. The liability to lose wages does
not either make the strike illegal as a weapon or deprive the workers of it.
When workers resort to it, they do so knowing full well its consequences.
During the period of strike the contract of employment continues but the
workers withhold their labour. Consequently, they cannot expect to be paid.
The
second fallacy from which the said decisions suffer is to view the contract of
employment as an indivisible one in terms of the wage period. When it is argued
that the wages cannot be deducted pro rata for the hours or for the day or days
for which the workers are on strike because the con- tract, which in this case
is monthly, cannot be subdivided into days and hours, what is forgotten is that,
in that case if the contract comes to an end amidst a month by death,
resignation or retirement of the employee, he would not be entitled to the
proportionate payment for the part of the month he served. This was the
iniquitous and harsh conse- quence of the rule of indivisibility of contract
laid down in an English case, Cutter v. Powell, [1795] 6 TR 320 which was
rightly vehemently criticised and later, fortunately not followed. If the
employment-contract is held indivisible, it will be so for both the parties. We
are also unable to see any difficulty, inequity or impracticability in
construing the contract as divisible into different 233 periods such as days
and hours for proportionate reimburse- ment or deduction of wages, which is
normally done in prac- tice.
The
third fallacy was to equate disputed individual- conduct with admitted mass
conduct. A disciplinary proceed- ing is neither necessary nor feasible in the
latter case.
The
contract of employment, Standing Orders or the service rules provide for
disciplinary proceedings for the lapse on the part of a particular individual
or individuals when the misconduct is disputed. As things stand today; they do
not provide a remedy for mass-misconduct which is admitted or cannot be
disputed. Hence, to drive the management to hold disciplinary proceedings even
in such cases is neither necessary nor proper. The service conditions are not
expect- ed to visualise and provide for all situations. Hence, when they are
silent on unexpected eventualities, the management should be deemed to have the
requisite power to deal with them consistent with law and the other service
conditions and to the extent it is reasonably necessary to do so. The pro rata
deduction of wages is not an unreasonable exercise of power on such occasions.
Whether on such occasions the wages are deductible at all and to what extent
will, howev- er, depend on the facts of each case. Although the employees may
strike only for some hours but there is no work for the rest of the day as in
the present case, the employer may be justified in deducting salary for tile
whole day. On the other hand, the employees may put in work after the strike
hours and the employer may accept it or acquiesce in it. In that case the
employer may not be entitled to deduct wages at all or be entitled to deduct
them only for the hours of strike. If further statutes such as the Payment of
Wages Act or the State enactments like the Shops and Establishments Act apply,
the employer may be justified in deducting wages under their provisions. Even
if they do not apply, nothing prevents the employer from taking guidance from
the legisla- tive wisdom contained in it to adopt measures on the lines
outlined therein, when the contract of employment is relent on the subject.
14. It
is, however, necessary to reiterate that even in cases such as the present one
where action is resorted to on a mass scale, some employees may not be a party
to the action and may have genuinely desired to discharge their duties but
could not do so for failure of the management to give the necessary assistance
or protection or on account of other circumstances. The management will not be
justified in deducting wages of such employees without holding an in- quiry.
That, however, was not the grievance of any of the employees in the present
case, as pointed out earlier.
234
15.
Hence, we are unable to sustain the impugned deci- sion which is untenable in
law. The decision is accordingly set aside with no order as to costs.
Civil
Appeal No. 855 of 1987
16.
The facts in this case are different from those in the earlier appeal. In this
case, the allegation of the employer Company is that the workers had indulged
in "go- slow" and as a result there was negligible production in the
month of July 1984. The workers did not attend to their duty and only loitered
in the premises and indulged in go-slow tactics only with a view to pressurise
the Company to con- cede demands. The Company was, therefore, compelled to
suspend its operation by giving a notice of lock out. Ac- cording to the
Company, therefore, since the workers had not worked during all the working
hours, they had not earned their wages. Hence, the Company did not pay the
workers their wages for the entire month of July 1984. The workers' Union,
therefore, filed a complaint before the Industrial Court under the Maharashtra
Recognition of Trade Unions and Prevention of Unfair Labour Practices Act, 1971
(MRTU & PULP Act, for short) complaining that the Company had indulged in
unfair labour practice mentioned in Item 9 of Schedule 4, from 7th August, 1984
which was the date for payment of salary for the month of July 1984, and under
Item 6 of Schedule 2 of the Act with effect from 14th August, 1984 since the
Company had declared a lock-out from that day. It was also alleged that since
no specific date of the com- mencement of the alleged lock-out had been
specified, it was an illegal one.
17. It
appears that the Company had declared the lock- out by notice dated July 30, 1984 and the lock out was effected from August 14, 1984. Subsequently, there were
negotiations between the Union and the Company, and a set- tlement was reached
on October 15, 1984 as a result of which the lock out was lifted with effect
from October 16, 1984.
The
terms of the settlement were formally reduced to writing on November 30, 1984.
18. In
this appeal, we are not concerned with the lock- out and the subsequent
settlement. The question that falls for consideration before us is whether the
Company was justified in denying to the workers the full monthly wages for the
month of July 1984. On this question, the Industrial Court accepted the oral
testimony of the Company's witnesses that the workmen had not at all worked for
full eight hours on any day in July 1984 and that they were working intermit-
235 tently only for some time and sitting idle during the rest of the day. On
an average the workers had not worked for more than one hour and 15 to 20
minutes per day, during that month. The Industrial Court did not accept the evidence of the Union's witness that the witness and the other workmen had
worked on all the days during the entire month of July 1984 because he admitted
that after the Company told the workers that it could not concede to the
demands, the work- ers had started staging demonstration. Although the witness
denied that from July
3, 1984, the workers
started indulging in go-slow, he admitted that the Company was displaying
notices from time to time with effect from July 4, 1984 alleging that the workers were not
giving production and that they were loitering here and there. According to the
Industrial Court in the circumstances, it did not see any good reason to
disbelieve the Company's witnesses. The Court further held that normally in
view of this evidence on record, it would have held that the pro rata deduction
of wages made by the Company for the month of July 1984 would not amount to an
act of unfair labour practice falling under Item 9 of Schedule IV of the MRTU
and PULP Act.
However,
in view of the two judgments of the Bombay High Court in T.S. Kelwala &
Ors. v. Bank of India & Ors., [1981] 43 FLR 341 i.e. the one impugned in
the earlier appeal and Apar (Pvt) Limited v.S.R. Samant & Ors., [1980] II
LLJ 344, the Court had to hold that the non-payment of full wages to the work-
men for the month of July 1984 was an act of unfair labour practice falling
under the said provision of the Act. The Court further held that admittedly the
workers were not piece-rated and there was no agreement or settlement allow- ing
the Company to deduct wages on the ground that they were indulging in
"go-slow" or that they had not given normal production. According to
the Court, the remedy of the Compa- ny against the workmen may lie elsewhere.
Thus, the Court taking sustenance from the Bombay High Court Judgments referred
to above held that the deduction of wages during the month of July, 1984 on
account of the go-slow was not justified, and declared that the Company had
committed an unfair labour practice by not paying full monthly wages to the
workmen, and directed the Company to pay the said wages for the month of July
1984. It is this order of the Indus- trial Court which is challenged directly
in this Court by the present appeal.
19.
Since one of the two decisions of the Bombay High Court on which the Industrial
Court relied was rendered in another context and it has already been discussed
in the other appeal, we may refer here only to the other decision, viz., Apar (Pvt)
Ltd. v. S.R. Samant & Ors., (supra) which is pressed in service before us
on behalf of the workmen.
The
facts in that case were that by a settlement dated Au- 236 gust 3, 1974 the
workmen were allowed increase in the basis wages, dearness allowance, house
rent, etc. in addition to the production bonus in terms of a scheme. That settlement
was binding on the parties upto the end of April 1977. The matters ran a smooth
course till August 1975. However, from September 1975, the Company refused to
pay the production bonus and with effect from 15th October, 1975 it refused to
pay the wages, dearness allowances etc. as per the settle- ment. On August 21,
1975, a notice was put up by the Company starting that because of the attitude
of indiscipline on the part of the workers and deliberate go-slow tactics
resulting in low production, the management was relieved of its com- mitments
and obligation imposed upon it by the settlement. A notice in terms of Section
9A of the Industrial Disputes Act, 1947 was also put up indicating a certain
scale of wages to which only the workers would be entitled. These wages were
not more than the wages under the Minimum Wages Act and were even less than
what was agreed to in the earli- er agreement of January 23, 1971. A complaint was, there- fore, filed under the MRTU &
PULP Act before the Industrial
Court, and the Industrial Court recorded a finding that the figures
of production produced by the Company before it related only to few
departments. Out of total of 700 employ- ees who were working earlier, 116 were
retrenched at the relevant time. The Company's allotment of material, viz., aluminium
was also reduced from 7390 metric tones to 2038 and there was no supply of even
that allotted quantity. The Court further referred to certain inconsistent
statements made by the factory-manager and held that the management had failed
to discharge the burden of proof of justifying the drastic reduction of the
wages and other emoluments. The Court therefore recorded a finding that the
Company had engaged in an unfair labour practice. Against the said decision,
the Company preferred a writ petition before the High Court. The High Court on
these facts held that the wages could be deducted only in terms of a statutory provi-
sion or of a settlement. A reduction of wages on the allega- tion that the
workers in general had resorted to go-slow was wholly impermissible in law specially
when the workmen were not piece-rated employees. The High Court referred to the
cases where reduction of wages for absence from duty for striking work was held
as valid such as Major Kanti Bose & Ors. v. Bank of India & Ors.,
(supra); V. Ramachandran v. Indian Bank, (supra) and Algemene Bank, Nederland
v. Central Government Labour
Court, Calcutta, (supra) and held that those cases
were distinguishable because they related to absence from duty and not go-slow.
In
M/s. Bharat Sugar Mills Ltd. v. Shri Jai Singh & Ors., [1962] 3 237 SCR 684
the facts were that certain workmen of the appel- lant-Mills resorted to
"go-slow". The appellant-Mills held a domestic inquiry and as a
result thereof decided to dismiss 21 workmen, and apply to the Industrial
Tribunal under Section 33 of the Industrial Disputes Act for permission to
dismiss the workmen. Evidence was laid before the Tribunal to prove the charge
against the workmen. The Tribunal held that the domestic enquiry was not
proper, that the appellant was guilty of mala fide conduct and victimisation,
that except in the case of one workman, the others were guilty of deliberate
go-slow and accordingly granted permission in respect of the one workman only.
It is against the said decision that the appellant-Mills had approached this
Court.
This
Court held that the evidence produced before the Tribu- nal clearly established
that 13 out of the 20 workmen were guilty of deliberate go-slow and in that
connection observed as follows:
"Go-slow
which a picturesque description of deliberate delaying of production by workmen
pretending to be engaged in the factory is one of the most pernicious practices
that discontended or disgruntled workmen sometime resort to. It would not be
far wrong to call this dishonest. For, while thus delaying production and
thereby reducing the output the workmen claim to have remained employed and
thus to be entitled to full wages. Apart from this also, "go-slow" is
likely to be much more harmful than total cessation of work by strike. For,
while during a strike much of the machinery can be fully turned off, during the
"go-slow" the machinery is kept going on a reduced speed which is
often extremely damaging to machinery parts. For all these reasons
"go-slow" has always been considered a serious type of
misconduct." This Court, therefore, set aside the order of the Tribunal
refusing permission to dismiss 13 of the workmen.
20.
There cannot be two opinions that go-slow is a serious misconduct being a
covert and a more damaging breach of the contract of employment. It is an
insidious method of undermining discipline and at the same time a crude device
to defy the norms of work. It has been roundly condemned as an industrial
action and has not been recognised as a legit- imate weapon of the workmen to
redress their grievances. In fact the model standing orders as well as the
certified standing orders of most of the industrial establishments define it as
a misconduct and provide for a disciplinary action for it. Hence, once it is
238 proved, those guilty of it have to face the consequences which may include
deduction of wages and even dismissal from service.
But by
its very nature, the proof of go-slow, particu- larly when it is disputed,
involves investigation into various aspects such as the nature of the process
of produc- tion, the stages of production and their relative impor- tance, the
role of the workers engaged at each stage of production, the pre-production
activities and the facilities for production and the activities of the workmen
connected therewith and their effect on production, the factors bear- ing on
the average production etc. The go-slow further may be indulged in by an
individual workman or only some workmen either in one section or different
sections or in one shift or both shifts affecting the output in varying degrees
and to different extent depending upon the nature of product and the productive
process. Even where it is admitted, go-slow may in some case present
difficulties in determining the actual or approximate loss, for it may have
repercussions on production after the go-slow ceases which may be difficult to
estimate. The deduction of wages for go-slow may, there- fore, present
difficulties which may not be easily resolu- ble. When, therefore, wages are
sought to be deducted for breach of con tract on account of go-slow, the
quantum of deduction may become a bone of contention in most of the cases
inevitably leading to an industrial dispute to be adjudicated by an independent
machinery statutory or other- wise as the parties may resort to. It is
necessary to empha- size this because unlike in this case of a strike where a
simple measure of a pro rata deduction from wages may pro- vide a just and fair
remedy, the extent of deduction of wages on account of a go-slow action may in
some case raise a complex question. The simplistic method of deducting uniform
percentage of wages from the wages of all workmen calculated on the basis of
the percentage fail in production compared to the normal or average production
may not always be equitable. It is, therefore, necessary that in all cases
where the factum of go-slow and/or the extent of the loss of production on
account of it, is disputed, there should be a proper inquiry on charges which
furnish particulars of the go-slow and the loss of production on that account.
The rules of natural justice require it, and whether they have been followed or
not will depend on the facts of each case.
21. In
the present case, the Industrial Court, as point- ed out earlier, has accepted
the evidence of the witness of the Company that the workmen had not worked for
full eight hours on any day in the month concerned, namely, July 1984, and that
they were working intermittently only for sometime and were sitting idle during
the rest 239 Of the time. According to him, the workers had worked hardly for
an hour and 15 to 20 minutes on an average during the said month. The witness
had also produced notices put up by the Company from time to time showing the daily
fall in the production and calling upon the workmen to resume normalcy.
There
is further no dispute that the copies of these notices were sent to the Union
of the workmen as well as to the Government Labour Officer. The Industrial
Court did not accept the evidence of the workmen that there was no go-slow as
alleged by the Company. Accordingly, the Industrial Court has recorded a
finding that the pro rata deduction of wages made by the Company for the month
of July 1984 did not amount to an act of unfair labour practice within the
mean- ing of the said Act. It does not further appear from the record of the
proceedings before the Industrial Court that any attempt was made on behalf of
the workmen to challenge the figures of production produced by the Company.
These figures show that during the entire month of July 1984, the production
varied from 7.06 per cent of 13.9 per cent of the normal production. The
Company has deducted wages on the basis of each day's production. In view of
the fact that there is a finding recorded by the Industrial Court that there
was a go-slow resorted to by the workmen and the production was as alleged by
the Company during the said period, which finding is not challenged before us,
it is not possible for us to interfere with it in this appeal. As stated above,
all that was challenged was the right of the employer to deduct wages even when
admittedly there is a go-slow which question we have answered in favour of the
employer earlier. The question with regard to the quantum of deduction from the
wages, therefore, does not arise before us for consideration. It is, however,
likely that the work- men did not question the figures of production before the
Industrial Court because they were armed with the two deci- sions of the High
Curt (supra) which according to them, had negatived the right of the employer
to deduct wages even in such circumstances. While, therefore, allowing the
appeal, we direct that the appellant will not deduct more than 5 per cent of
the wages of the workmen for the month of July 1984.
22.
The appeal is allowed accordingly with no order as to costs.
G.N.
Appeals allowed.
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