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Management of the Barara Cooperative Marketing cum Processing Society Ltd. v. Workman Pratap Singh

Civil Appeal · 2019 INSC 1Decided 2 Jan 2019
Civil Appeal No. 7 of 2019
Justice Abhay Manohar Sapre · Justice Indu Malhotra

Background

A peon's employment was terminated in 1985; a Labour Court later found the termination unlawful but, instead of ordering reinstatement, awarded him a lump sum of Rs. 12,500 in lieu of getting his job back - compensation he accepted. Years later, after the employer regularised two other peons already working for it, this former employee claimed he was entitled to be re-employed under Section 25(H) of the Industrial Disputes Act, which gives retrenched workers preference when an employer fills new vacancies. A second Labour Court reference went against him, but the High Court (both single judge and division bench) ruled in his favour and ordered his re-employment.

Decision Breakdown

The Supreme Court held that Section 25(H) applies only where an employer is filling genuinely new vacancies by hiring fresh candidates - not where it is merely formalising ("regularising") the position of employees who are already working. Since no new vacancy was being filled in this case, the provision did not apply. The Court also noted that since the worker had already accepted compensation in lieu of reinstatement for his original termination, that matter was finally closed. It set aside the High Court's orders and restored the Labour Court's decision against the worker.

Lesson Learnt

A law meant to give retrenched workers priority for new job openings does not apply when an employer simply regularises existing employees' status, since no new vacancy is actually being created.

Official source (sci.gov.in)View Judgment (PDF)

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