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ONGC Employees Mazdoor Sabha v. The Executive Director Basin Manager, Oil and Natural Gas Corporation (India) Ltd.

Civil Appeal · 2020 INSC 181Decided 13 Feb 2020
Civil Appeal No. 1570 of 2020
Justice Rohinton Fali Nariman · Justice S. Ravindra Bhat · Justice V. Ramasubramanian

Background

Between 1999 and 2001, ONGC hired around 800 people on 4-year term contracts through the Employment Exchange, following interviews but without a public newspaper advertisement. After their terms ended, the employees' union demanded regular (permanent) appointment for 577 of these term-based workers. An Industrial Tribunal partly allowed the claim in 2011, and the Gujarat High Court later directed that eligible workers be treated as regular employees from 24 January 2005 (when their four-year terms expired), with only "notional" (not actual, backdated) pay benefits before 1 April 2013. The workers' union argued they deserved actual back-pay benefits from a much earlier date: their original appointment or probation completion.

Decision Breakdown

The Supreme Court held that the workers' entitlement to be treated as regular employees should run not from the end of their 4-year terms (2005) but from 21 December 2004, the date the Central Government formally referred the dispute to the Industrial Tribunal, since that was when the employees collectively and promptly asserted their claim, and the ensuing years of litigation delay should not count against them. The Court distinguished contrary precedents cited by ONGC, noting those cases either involved materially different facts (no genuine recruitment process followed) or long, unexplained delay by employees in raising their claim, which didn't apply here since this group acted immediately after their terms ended. The appeal was allowed to the extent of advancing the date for actual (not merely notional) benefits to 21 December 2004.

Lesson Learnt

When term-based or contractual workers are irregularly (but not illegally) appointed through a genuine selection process, and they promptly raise a claim for regularisation once their initial term is up, courts may backdate their regular service and actual pay benefits to the date the claim was first formally raised: delay caused by the legal process itself should not be held against diligent claimants.

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

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