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Harris Mineral Supply Co. and ors. Vs. Salim M. Merchant and ors. - Court Judgment

LegalCrystal Citation
SubjectLabour and Industrial
CourtMadhya Pradesh High Court
Decided On
Case NumberMisc. Petn. No. 394 of 1964
Judge
Reported inAIR1966MP60; 1965MPLJ534
ActsIndustrial Disputes Act, 1947 - Sections 2 and 25A; Mines Act, 1952 - Sections 49
AppellantHarris Mineral Supply Co. and ors.
RespondentSalim M. Merchant and ors.
Appellant AdvocateY.S. Dharmadhikari and ;M.V. Tamaskar, Advs.
Respondent AdvocateB.P. Pandey, Adv. for Respondent No. 2
Cases Referred and Wenger and Co. v. Workmen
Excerpt:
- - it is now well settled that in fixing the bare subsistence or the minimum wage the capacity of the employer need not be considered because it is a duty of the industrial employer to pay the basic minimum to his employees. the way in which the tribunal dealt with the matter of fixation of wages shows that it paid scant regard to the well settled principles with regard to fixation of minimum wages and fair wages. we see no justification for interfering with the finding of the tribunal, reached on the material before it, that the persons appointed as 'mine managers' were no better than supervisors......respect of the following issues:''1. whether the present wage rates of the following categories of workmen employed in the ochre mines of jaitwara area of the aforesaid employers are satisfactory; if not, to what revision of wage rates they are entitled and from which date: (1) assistant managers (ii) clerks and supervisors (iii) mates (iv) time-rated male labour (v) time-rated female labour (vi) piece-rated male labour (vii) piece-rated female labour. (2) whether the persons who are employed as mine managers in the ochre mines of the aforesaid employers in jaitwara area are 'workmen' under the provisions of the industrial disputes act; and if so, whether they are entitled to the revision of their wage rates and to what extent and from which date? (3) whether the workers employed in.....
Judgment:
ORDER

1. The petitioners in this case seek a writ of certiorari for quashing a part of an award given by the Industrial Tribunal, Bombay, on 18th June 1964 in a dispute referred to it by the Central Government in the exercise of its powers under Section 10(1)(d) of the Industrial Disputes Act, 1947, (hereinr after referred to as the Act).

2. The petitioners are owners of ochre mines situated in Jaitwara area of district Satna. The employees of the mines presented as many as thirty-two demands against the petitioners and raised an industrial dispute. When the dispute could not be settled in conciliation proceedings, the Central Government, by an order made on 15th June 1962 under Section 10(1)(d) of the Act referred to the Industrial Tribunal Bombay, for adjudication ten matters arising out of the dispute and specified in a schedule annexed to the order. The Industrial Tribunal gave an award on those matters on 18th June 1964. The petitioners question the award in respect of the following issues:'

'1. Whether the present wage rates of the following categories of workmen employed in the ochre mines of Jaitwara area of the aforesaid employers are satisfactory; if not, to what revision of wage rates they are entitled and from which date:

(1) Assistant Managers (ii) Clerks and Supervisors (iii) Mates (iv) Time-rated male labour (v) Time-rated female labour (vi) Piece-rated male labour (vii) Piece-rated female labour.

(2) Whether the persons who are employed as mine managers in the ochre mines of the aforesaid employers in Jaitwara area are 'workmen' under the provisions of the Industrial Disputes Act; and if so, whether they are entitled to the revision of their wage rates and to what extent and from which date?

(3) Whether the workers employed in the ochre mines of the aforesaid employers are entitled to wages, lay-off compensation or any other relief during the period the mines were and are closed in rainy season; and if so, the quantum of such relief and the date from which the said relief is admissible?

(4) Whether the employers who employ less than 100 workers are liable to make the workers permanent; and if so, what should be the eligibility for such permanency and to what relief the existing workers are entitled?

(5) Whether the workers employed by the aforesaid employers are entitled to any sick leave; if so, at what rate?'

3. The Tribunal has found that the petitioners employ between 400 to 600 workmen of whom 25p.c. are time-rated and the remaining are piece-rated; that the total number of mines worked by them is twenty-five; and that the ochre mine industry is seasonal as the mines cannot be worked during the rainy season and they remain closed during that period. On the first question relating to wage-rates, the Tribunal, after examining the capacity of the industry to pay the wages demanded by the employees and the work done by a worker each day, and after taking into account the 'nature and existing conditions of work in the ochre mines', formed the view that the present wages to the workmen were inadequate and did not even fulfil the minimum wage requirements and concluded by observing that 'taking into consideration the facts and circumstances of the case, the nature of the work, the financial position of the industry, and the level of wages in the region in other industries particularly the iron ore mining', it would be fair to fix the minimum wage for the daily rated workmen at Rs. 2.12 nP. per day inclusive of dearness, allowance, and that those working in the gallaries, if daily rated, should be paid an extra allowance of Rs. 0.12 nP. per day. After finding that there were no Assistant Managers employed in the mines, the Tribunal then proceeded to fix the wages of other categories of workers, namely, clerks and supervisors, mates, time-rated male and female labour, and piece-rated male and female labour. The Tribunal then considered the second question, namely, whether the persons employed as. 'mine managers' in the ochre mines of the petitioners were 'workmen' within the meaning of Section 2(s) of the Act. It found that they were managers only in name and not employed in any managerial or administrative capacity; and that they were merely supervisors looking after and supervising the labour and production work at the mines, and accordingly they were 'workmen' as defined by Section 2(s) of the Act. The wages of these managers were fixed by the Tribunal at Rs. 125/- p.m. inclusive of dearness allowance with an extra Rs. 5/- p.m. as gallary allowance. The Tribunal was of the opinion that the revised wages should be given retrospective effect, and it held that they should come into effect as from 1st January 1963.

4. In regard to the demand of the workers for payment of 'lay-off compensation or any other relief for the period during which the mines remain closed on account of rains, the Tribunal, without expressing any opinion on the question whether the industry being seasonal any lay-off compensation could at all be paid to the workmen, held that workmen should be given some relief for non-employment during the rainy season and this should take the form of a 'retention allowance' to workmen 'who have during the period from the reopening of the mines after the monsoon to the closure of the mines in the following year just prior to the break of rainy season put in 180 days' attendance at the mines'. The Tribunal fixed this retention allowance at Rs. 2/- p.m. during the rainy season and made it enforceable from the rainy season of 1965. On the question of the workers, employed by a mine owner employing less than 100 workers, being made permanent, the Tribunal gave the direction that as soon as a workman becomes entitled to receive retention allowance he should be deemed to have become permanent in the employment. The Tribunal decided the question of grant of sick leave by directing that seven days' sick leave in a year should be allowed to those workmen who have been made permanent for the purpose of retention allowance' and that 'even otherwise all those workmen who put in 180 days attendance in a year shall be entitled to claim seven days' sick leave in that year'.

5. Shri Dharmadhikari, learned counsel for the petitioners, attacked the award of the Tribunal on the matters stated earlier by contending that the Tribunal fixed minimum wages in respect of different categories of workmen employed in the mines when the order dated 15th June 1962 of the Central Government referring the dispute to the Tribunal for adjudication did not authorise it to do so; that the fixation of minimum wages for different kinds of workers by the Tribunal was wholly without jurisdiction; and that in determining whether the wages paid to the workers in mines were or were not satisfactory and whether a revision of those wages was called for, the Tribunal should have considered the capacity of the industry to pay and adopted industry-cum-region basis for fixation of wages and should have paid regard to the established principles of wage fixation. It was further said that the Tribunal erred in holding that persons employed in the petitioners' mines as 'managers' were workmen within the meaning of Section 2(s); and that as these managers were not 'workmen' as defined by Section 2(s), the Tribunal was not competent to fix their wages. Learned counsel proceeded to argue that when working in the ochre mines was seasonal and the persons working therein were not entitled under the Act to any lay-off compensation, the Tribunal was not justified in granting to these workmen lay-off compensation in the form of retention allowance, and if retention allowance could not be granted to the workmen, then there was no basis for making them permanent in employment; and that the grant of sick leave was not based on any reason or workable principle.

6. In our judgment, the wages fixed by the Tribunal for different categories of workers employed in the petitioners' ochre mines cannot be allowed to stand for the reason that the approach of the Tribunal to the matter of fixation of wages, as posed by the first question narrated in the schedule to the order of reference dated the 15th June 1962, was wholly erroneous. That question required the Tribunal first to determine whether the present wage-rates were satisfactory, and if they were not satisfactory, then to revise them and fix a date for the operation of the revised wages. Instead of doing this, the Tribunal, after noting the contentions advanced on behalf of the petitioners and the workmen, straightway proceeded to examine the question whether the industry was in a position to bear the financial burden of any increase in wages, and found that the industry was in a position to meet the additional financial burden involved in the increase of wages. It then considered the nature of work done by the workers and the hours of work put in by them daily, took into account the nature and conditions of work in ochre mines, and concluded that the present wages paid to workmen were inadequate and did not even fulfil the minimum wage requirement. A look at the award of the Tribunal on this point is sufficient to show that the Tribunal had no clear idea of what it had to decide in connection with the first question relating to fixation of wages, and of the principles laid down by the Supreme Court in several cases that have to be borne in mind in fixing the minimum wage or the basic wage, the fair wage and the living wage. It is now well settled that in fixing the bare subsistence or the minimum wage the capacity of the employer need not be considered because it is a duty of the industrial employer to pay the basic minimum to his employees. Where a fair wage has to be fixed, the capacity of the industry to pay is one of the essential factors to be taken into consideration, and the capacity of the industry to pay is to be determined on industry-cum-region basis after taking into account a fair cross-section of the industry. In determining the capacity of the industry to pay, a note has also to be taken of the elasticity of demand for the product, and the possibility of tightening up or rationalising the organisation. All these principles are now firmly settled by the decisions of the Supreme Court in Express Newspaper Ltd. v. Union of India, 1958 SCR 12: (AIR 1958 SC 578), Lipton Ltd. v. Their Employees, AIR 1959 SC 676, U. Unichoyi v. State of Kerala, AIR 1962 SC 12, French Motor Car Co. v. The Workmen, AIR 1963 SC 1327, Greaves Cotton Co. Ltd. v. Workmen, AIR 1964 SC 689, Workmen of Balmer Lawrie and Co. Ltd. v. Balmer Lawrie and Co. Ltd., AIR 1964 SC 728 and Wenger and Co. v. Workmen, AIR 1964 SC 864. All these principles were overlooked by the Tribunal. If it thought that the wages' being paid to the workers were even below the bare subsistence or the minimum wage level, then it should have fixed the minimum wage-rate not on the basis of the capacity of the industry to pay or the nature and amount of the work done by the workers and the conditions under which they were working, but on the basis of what was necessary to the worker for the bare subsistence of life, for the preservation of his efficiency and for providing for some measure of education, medical requirements and amenities. The wages fixed by the Tribunal as 'Minimum wages' thus rest not on factors which have to be taken into consideration in fixing a minimum wage but on irrelevant considerations. The wages fixed by the Tribunal cannot even in substance be regarded as a fixation of fair wage for they have been fixed without any reference to the industry-cum-region basis. In fixing those wages, the Tribunal completely ignored the wages prevailing in ochre mines located in the same area belonging to persons other than the petitioners. The way in which the Tribunal dealt with the matter of fixation of wages shows that it paid scant regard to the well settled principles with regard to fixation of minimum wages and fair wages. In these circumstances, the wage-rates fixed by the Tribunal for the different categories of workers employed by the petitioners must be quashed.

7. There is, however, no mistake in the approach of the Tribunal to the question whether the persons employed by the petitioners as 'mine managers' are workmen within the definition given in Section 2(s) of the Act. According to that definition, a person employed in any industry to do any supervisory work is a 'workman'. But the definition excludes from its scope any person who is employed mainly in a managerial capacity, or a person who, being employed in a supervisory capacity, draws wages exceeding Rs. 500/- per mensem or exercises, either by the nature of the duties attached to the office or by reason of the powers vested in him, functions mainly of a managerial character. On a consideration of the evidence led before it, the Tribunal has found that the duties actually performed by the persons appointed by the petitioners as managers consist in looking after and supervising labour and production work at the mines, that their wages are nowhere near Rs. 500/-p.m. and that they do not exercise any function of a managerial nature and none of them is even qualified or competent to discharge the duties of a mine manager under the Mines Act. In determining whether an employee is or is not a manager, excluded from the definition of 'workman' given in Section 2(s), what is decisive is not his designation but the nature of the work done by him. In order to come within the category of a person 'who is employed mainly in a managerial or administrative capacity' excluded from the definition of 'workman', it is essential that the predominant feature of the duties of the person employed as manager must consist in directing and controlling other employees or in discharging functions mainly of a managerial nature. We see no justification for interfering with the finding of the Tribunal, reached on the material before it, that the persons appointed as 'mine managers' were no better than supervisors. The Tribunal's fixation of wages of the persons employed as managers must, however, be quashed for the reason that whether viewed as a fixation of minimum wage or that of a fair wage, it is not based on proper considerations in the fixation of minimum wage or fair wage.

8. In directing that those workers who have during the period from the reopening of the mines after the monsoon to the closure of the mines in the following year just prior to the break of rainy, season put in 180 days' attendance should be paid 'retention allowance' at the rate of Rs. 2/- p.m. during the rainy season, the Tribunal overlooked the important fact that the ochre mine industry being seasonal, Section 25C of the Act, which deals with payment of lay-off compensation, is not applicable to it. Section 25A inter alia lays down that Sections 25-C to 25-E inclusive shall not apply to industrial establishments which are of a seasonal character or in which work is performed intermittently. The Tribunal accepted the fact that the industry is seasonal, though at one place, while dealing with the question of the workers being made permanent, it observed that the Central Government had not declared the industry seasonal. The absence of any such declaration by the Central Government in no way vitiates the finding of the Tribunal that the ochre mine industry is seasonal and it is not possible to work the mines during the rainy season lasting for almost four months. Sub-section (2) of Section 25A no doubt says that when a question arises whether an industrial establishment is of a seasonal character, the decision of the appropriate Government shall be final. This provision does not, however, mean that even when no dispute arises between the employers and employees as regards the seasonal character of an industry, the declaration of the Central Government is still necessary to give that character to the industry. In the present case, both the petitioners and their employees were agreed that the ochre mine industry was seasonal. In fact, the question, whether the workers employed in the mines were 'entitled to wages, lay-off compensation or any other relief during the period the mines were and are closed in rainy season,' which the Tribunal was called upon to decide, itself presupposed that the mines remain closed during the rainy season and the mining industry is seasonal. If under Section 25A read with Section 25C, lay-off compensation cannot in law be granted to workers in the industry, then it cannot be granted under any other description such as 'retention allowance'. So to do is to circumvent the bar put by Section 25A(1)(b) on the payment of lay-off compensation to workers in an industrial establishment of seasonal character. The Tribunal observed that the demand for payment of lay-off compensation or any other relief was made by workers in their anxiety to secure continuity in their service. The anxiety is no doubt understandable. But when there is a statutory bar for the grant of such compensation to workers in a seasonal industry, as it is inherently incompatible with the position of workers in a seasonal industry, the anxiety cannot be relieved or alleviated by drawing upon any concept of social justice. Therefore, the Tribunal's award in regard to payment of 'retention allowance' to workers cannot be sustained. If this payment cannot be sustained, then the further direction of the Tribunal that those workers who have become eligible for payment of retention allowance must be made permanent, must necessarily fall. If the payment of retention allowance is not justified, then the very basis of the Tribunal's award giving a permanent status to the workers eligible for retention allowance altogether disappears.

9. The Tribunal's award with regard to the grant of seven days' sick leave to the workers cannot be assailed either on the ground that it had no jurisdiction to grant this leave or on the ground that the grant had been made to rest on principles which are unworkable. The direction of the Tribunal is that seven-days sick leave in the year should be granted to those workmen who have been made permanent and that 'even otherwise all those workers who have put in 180 days' attendance in the year should be allowed seven days' sick leave in that year'. The words 'even otherwise', used by the Tribunal make it very clear that the grant of seven days' sick leave to workers by the Tribunal has really as its basis 180 days' attendance by a worker and not the fact of permanency in service of the worker. It does not, therefore, follow that as the workers cannot be granted lay-off compensation or retention allowance and cannot be made permanent, therefore, the Tribunal's direction with regard to seven days' sick leave must be struck down. The grant of seven days' sick leave in the particular year in which the worker has put in 180 days' attendance is non-cumulative. There can, therefore, be no difficulty in working out the grant of that leave on the basis of seven days' leave on 180 days' attendance. It is true that the provisions contained in Chapter VII of the Mines Act, 1952, do not deal with sick leave at all. But Section 49, which is contained in that chapter, inter alia says that the provisions of that chapter shall not operate to the prejudice of any right to which a person employed in a mine may be entitled under the terms of an award. It cannot, therefore, be contended that Chapter VII operates as a bar to the grant of sick leave under an award to the workers. The value of sick leave in maintaining efficiency and preventing prolonged sickness and absenteeism in the workers on that account is obvious enough. If a worker with a slight ailment is compelled to work when he cannot get any leave his health may further deteriorate. That is bound to result in prolonged sickness and his long absence. The Tribunal's direction as regards the grant of seven days' sick leave to the workers must, therefore, be upheld.

10. For the foregoing reasons, the Tribunal's award in so far as it relates to the fixation of wage-rates for different classes of workers including mines managers, the payment of retention allowance and the workerswho are eligible for retention allowance being made permanent, is quashed. In the circumstances of the case, there will be no order as to costs. The outstanding amount of security deposit shall be refunded to the petitioners.


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