V. Pattabhiramayya, J.
1. This is an industrial dispute between the workers and the management of Swadesamitran, Ltd., Madras, and it was referred for adjudication to this Labour Court by G.O. Ms. No. 2440, I.L. & C., dated 20 July 1957. The point referred for adjudication as stated in the annexure to the said Government order is:
Non-payment of increments to the working journalists from the year 1953.
* * *
4. On these contentions the following issues were settled for enquiry :
(1) Whether the action of the management in not granting increments to the working journalists from 1953 is justified?
(2) If not, to what relief are they entitled?
5. Issue (1).--Till the year 1943 all the members of the staff of this concern were not having any regular scales of pay and they were being appointed on certain fixed salaries and probably some ad hoc increments were being given to them from time to time considering their capacity, efficiency, and usefulness. In 1943 by a circular, marked as Ex. M. 1, regular time-scales were introduced for all members of the establishment. We are concerned in this dispute only with the scales fixed for the working journalists. Three grades and scales of pay were fixed for the members of the editorial section and they were as follows:
I Grade-Rs. 120-10-200.
II Grade-Rs. 75-74-120.
III Grade-Rs. 40-5-75.
At that time the persons who formed the members of the editorial section were not only fixed in one or other of these grades but their salaries in those grades were also determined. The initials of the assistant editors and sub-editors were also taken in Ex. M. 1 probably in token of their acceptance. According to the management these scales continued to be in force till 1949. But the case of the workers is that there was a revision of these scales even in August 1946 and that at that time better scales were fixed, the lowest being Rs. 75-12 1/2-100-12 1/2- 150. The working journalists have not led any evidence of the other grades. We are not much concerned in this dispute as to whether there was a revision of scales in 1946 or not. Anyhow in 1949, even according to both sides there was a revision of scales. The case of the workers is that a regular circular was issued by the management announcing those revised scales of 1949 and that the members of the editorial staff were made to sign that circular. According to the management there was no such circular at all and the scales were only mentioned in a statement prepared by the office giving particulars relating to each assistant editor and sub-editor. The statement is marked as Ex. M. 5 and the scales mentioned therein, namely, Ex. M. 5(a), are as follows:
Bs. 75--12 1/2--150.
Rs. 300--28--500. Rs. 500--50--750.
In spite of the introduction of these scales in 1949 no Increments in these scales were given to the working journalists in 1950 when they became due probably because the company incurred losses in 1949. Anyhow we are not concerned with that matter now as the reference relates only to the non-payment of increments from the year 1953. Even in the year 1950 the company incurred losses and consequently the management revised and reduced the scales of pay of the editorial staff in August 1951. These scales of 1951 were much lower than those of 1949 for all grades other than the lowest one. As regards the lowest category of sub-editors the same grade of 1949 was retained probably because they were getting very low pay and would be seriously affected by any further reduction. Even in 1951, according to the management, no regular circular was issued announcing the scales and the scales were only written in pencil by the managing director on Ex. M. 5. The scales mentioned by the managing director are marked as Ex. M. 5(b). Exhibit M. 5(6) does not mention the lowest grade probably because no change was effected in that grade and it was retained as it was. The scales of 1951 are as follows :
Grade I-Rs. 75-12 1/2-150.
Grade II-Rs. 150-15-225.
Grade III-Rs. 225-20-325.
Grade IV-Rs. 325-25-450.
Grade V-Rs. 450, selection grade.
There is nothing to show as to how the members of the editorial staff were fixed in these new scales of 1951. The management gave increments according to these scales to the editorial staff during the years 1951, 1952 and 1953. It is the admitted case of both sides that from 1954 onwards no increments were given to the Working journalists in spite of the existence of the time-scales providing for annual increments. The last increment drawn by these working journalists was in 1953.
6. The contention of the working journalists is that when time-scales are fixed and when increments have been granted to them, it amounts to conditions of service and that the management is not entitled to commit a breach of those conditions by depriving them of their increments. On the other hand the case of the management is that there was an express or at least an implied condition to the effect that the management reserved a right to suspend payments of increments in case the financial condition of the company warranted such a course and that consequently they were entitled to stop the payment of increments. It is of course their case that from 1953 onwards this concern has been having a continuous adverse trading position year after year and that therefore they could not afford to pay increments. In the absence of the special contract to the contrary pleaded by the management normally the contention of the working journalists should prevail. When a worker is employed by a concern on a particular time-scale, it must be presumed that the worker would be paid the annual increments in that scale provided of course his work and conduct are satisfactory. It is only in cases where the conduct and work of the employee are not satisfactory, that the management might be entitled to withhold the increments as a punishment to stimulate better work or behaviour. I shall therefore deal with the contention of the management regarding the condition set up by them. In Ex. M. 1, the circular of 1943, it is mentioned that one of the two reasons which prompted the managing director to introduce time-scales is as stated by him:
because the staff cheerfully submitted to salary cuts when need arose in the past and I have no doubt that they will be ready to do so again if at any time the interests of the institution require it.
This circular also expressly states as follows:
Subject to the qualification that the management reserves the right to suspend, should conditions in their view warrant it, the operation of the time-scale in whole or in part, the following scales and promotions are sanctioned with effect from 1 February 1943.
Thus it is clear that when scales were introduced in 1943 the management imposed an express term to the effect that it reserved the right to suspend the scales if it thought fit to do so. If these scales of 1943 continued to be in force, then the management would undoubtedly be within their rights when it stopped increments after 1953. But there is nothing to show that a similar condition was also stipulated by them when they revised the scales in 1949 and 1951. The contention of the management is that it must be presumed that this condition continued to apply even for those scales of 1949 and 1951 and that the working journalists are bound by it. It is of course suggested by the editorial staff that there were circulars in 1949 and 1951 mentioning the revised scales and that those circulars never contained any such condition. It is even suggested that those circulars are being suppressed by the management as they would expose the hollowness of its case. Anyhow there is absolutely no reliable evidence on the side of the management to prove its case that this condition entitling the management to withhold increments were announced to the working journalists either in 1949 or in 1951 when the scales were revised and that they agreed to abide by it. Though no doubt the working journalists must be deemed to be bound by the condition so far as 1943 scales are concerned, it is difficult to hold that this condition applies to the relevant scales of 1951 as there is no evidence on the side of the management proving that they were informed of such a condition and that they expressly or impliedly agreed to abide by it. Merely because a condition to this effect was imposed in 1943, it does not ipso facto mean that it would apply to very revision of scales during the subsequent years. If the management wanted to reserve such a right, they should have expressly informed the working journalists of such a condition and should have given them the opportunity either to accept it or reject it and seek other remedies open to them. It is not proper on the part of the management to say that they are bound by this condition in Ex. M. 1 when they had no chance of expressing their approval or disapproval of it. On the evidence I have no alternative but to find that the working journalists were not informed of this condition at least when the scales of 1951 were introduced. If they had not been informed about it, it will be idle to contend that they were consenting parties to it. As I have already stated, when time-scales are introduced and made applicable to the employees, it amounts to a representation by the management that they would be paid the increments mentioned in those scales. When the employees accept these scales and work under the management, it amounts to the acceptance of the offer of the management and under such circumstances an implied contract must be presumed and under the terms of such an implied contract the employees would be entitled to their annual increments.
7. With a view to prove its case that there was an implied contract or understanding that the management had a right to withhold increments, they have relied upon certain written representations made by the members of the staff during the years 1955 and 1956. These communications are marked as Exs. M. 6 to M. 8. Exhibits M. 6 and M. 7 are addressed by all members of the staff including the working journalists and Ex. M. 8 was sent by only the editorial staff. In these petitions or memorials the signatories have represented their grievances and have stated that they had not been given increments, that they were finding it difficult to meet their family budgets and that they were constrained to bring those facts to the notice of the managing director because of the then existing difficult circumstances. In none of these documents there is any assertion that the members of the staff were entitled to an increment as a matter of right and that the withholding of the same was not proper. Relying upon the contents of these documents it is argued for the management that the conduct of the working journalists goes to prove that they were aware of the right of the management to withhold increments and that consequently they wrote these letters in such a mild form. I am Unable to accept the argument of the management. Simply because the employees did not assert their right but requested the management to consider their case sympathetically, it does not necessarily follow that they did so being conscious of the condition relied upon by the management. Being in the service of the management they were probably not inclined to adopt a more aggressive tone. Further when Exs. M. 6 and M.7 were sent the working journalists had no recourse to any industrial law for the remedy of their grievances. They were more or lew at the sweet will and pleasure of the management and under such circumstances one could very well understand the mild tone used in these documents. Exhibit M. 8 was no doubt written after the Working Journalists (Conditions of Service and Miscellaneous Provisions) Act came into force. In this document though they complained that they were not given increments for the previous four years they have not requested for the grant of their increments. All that they wanted was the sanction of two months' wages as advance. Therefore Ex, M. 8 does not as such relate to any claim for increments. Anyhow I am not inclined to find, as stated by the management, that these documents prove or probabilize their case that working journalists were conscious of any rights of the management to withhold increments.
8. It is one of the main contentions of the management that they are not in a position to grant increments on account of the financial position of the company. To prove this case they have filed all the balance sheets and profit and loss accounts for the year 1943 to 1956. As we are concerned mainly only with the years 1953 to 1956, I give below the trading results of the company during these years. The profits are shown with the sign + and losses are shown as:
Rs. A. P.1953 ... ... ... 52,093 2 8 1954 ... ... ... 64,146 7 21955 ... ... ... 1,32,860 5 61956 ... ... ... 2,09,014 10 4--------------4,58,114 9 8--------------
Thus it will be seen from the above figures that this company had incurred losses during these four years to the tune of over 4 1/2 lakhs. Some of the balance sheets of even the prior years go to show that the company had incurred losses. Relying upon these facts it is contended for the management that a concern, which had been incurring continuous losses in this manner, cannot be compelled to pay increments as such a course would throw a heavier liability on this concern and involve it in greater losses even necessitating the closure of the newspaper establishment. There is no doubt a good deal of substance in the management's plea that this concern cannot afford to shoulder any further liability by way of increments of salaries. But it must at the same time be remembered that these working journalists are not being paid anything like living wages or even fair wages compared with their qualifications, attainments and work done by them. Their lot in life is not enviable considering the modern conditions of life. Therefore I, am inclined to hold that the management must find other ways and means of effecting economy in its affairs but not deprive these low-paid employees of their legitimate claims. Even the working journalists of this concern are well aware of the difficulties of the management and consequently they have adopted a very reasonable attitude by filing a memorandum saying that they do not press their claims for arrears of increments payable to them for the years 1954 to 1957 and that they would confine their claims for arrears from the date of reference provided of course they are paid what they would have drawn had the increments been granted regularly. I have no doubt that their request is a very modest and fair one and I see no strong grounds to reject it. I therefore direct the management to fit salaries of these working journalists at the figures which they would have drawn had they been granted their usual increments during the years 1954 to 1957 and also pay the arrears of increments from the date of the reference.
9. It is the case of the working journalists that all the grades in the 1951 scales of pay are only parts of one running scale and that a person who is drawing salary in a lower scale automatically jumps into the next higher scale after reaching the maximum of the lower scale and that the salaries should now be fixed on such a basis. Thus it is their contention that a person who starts in the lowest step of the first grade reaches the maximum of the highest grade by efflux of time without any further orders of the management. On the other hand, the case of the management is that each working journalist was fixed in a particular grade, that he could only draw the increments up to the maximum of that grade and that the management has a right either to promote him to the next higher grade or retain him in the same grade after considering his work, conduct and usefulness. I think the contention of the employees is based upon the accidental circumstance that the highest step of lower grade happens to be the lowest step of the next higher grade. Except the ipse dixit of W.W. 1, there is nothing to prove the case of the working journalists that they are entitled to such automatic promotions to the next higher grades on reaching the maximum of the grade in which they had been fixed. Promotion to the higher grade is undoubtedly a managerial function and the management has a right and a discretion either to promote a person to the higher grade or retain him in the same grade. No employee can normally claim that he is entitled to automatic promotion to a higher grade. Usually considering its means and necessities the management appoints or fixes the number of persons in each grade and it is only when a vacancy in a higher grade arises that a person is promoted from a lower one if he is qualified for promotion. If all the grades are only part of one time-scale of pay there is really no need whatsoever to have grades at all. Considering all these circumstances, I think the case of the management that each working journalist can only draw increment up to the maximum of his grade and that he has to be promoted to the next grade subsequently is well founded. Consequently it follows that the management is bound to fix the increased salaries of each of these working Journalists as on the date of the reference only up to the maximum of the grade applicable to him and not by automatic promotion to the next higher grade. It is of course open to the management to promote them or any of them to the next higher grade, if they like.
10. One of the contentions raised by Mr. K.S. Varadachari on behalf of the management is that in this dispute these working journalists cannot validly claim the increments prior to 1955. This argument is based upon the ground that the Working Journalists (Conditions of Service and Miscellaneous Provisions) Act came into force only on 20 December 1955 and that Act alone enabled the provisions of the Industrial Disputes Act to be applied to the working Journalists. It is argued that as these working journalists were not entitled to raise an Industrial .dispute prior to 1955 they cannot HOW retrospectively claim increments for the years 1954 and 1955 and that, if at all, they can do so only for the period after the Working Journalists Act came into force. I am unable to accept this argument as sound and well founded. No doubt the Working Journalists Act conferred the status of 'workmen' on the working journalists so as to enable them to raise industrial disputes under the Industrial Disputes Act. But there is nothing in either that Act or even in the Industrial Disputes Act to restrict their rights or claims only to the period after the passing of those enactments. In the Industrial Disputes Act there is no provision debarring workmen agitating their claims even for the period prior to the passing of that Act. For example, workmen of a concern who had been in service for a very long time prior to 1947, when the industrial Disputes Act was passed, could very well agitate a claim for gratuity payable for their entire period of service including the period prior to the Act. In a large number of cases such claims have been put forward and have been awarded by the industrial tribunals and Labour Appellate Tribunal. The circumstance that the working journalists could agitate disputes under the Industrial Disputes Act only after the coming into force of the Working Journalists Act does not necessarily imply that they should confine their claim only to those which arise after that Act was passed. I am unable to find any provision in the Act restricting their claims in such a manner and no such provision was pointed out to me by Mr. Varadachari. I am therefore unable to accept this contention of the management.
11. It was also argued by Mr. Varadachari for the management that this dispute relates to wages of the workmen, a matter mentioned in Sch. III to the Industrial Disputes Act, and that therefore it could be validly referred only to the industrial tribunal and not to the labour court for adjudication under Section 10(1) of the Industrial Disputes Act. Even conceding of purposes of argument that this dispute relates to a matter mentioned in the Sch. III, I think the proviso to Section 10(1) ear ables the appropriate Government to refer this dispute to a labour court. The proviso reads thus:
Provided that where the dispute relates to any matter specified in the Sch. III and is not likely to affect more than one hundred workmen, the appropriate Government may, if it so thinks fit, make the reference to a labour court under Clause (c).
Prom this proviso it is clear that though the dispute may relate to a matter specified in the Sch. III, it can be referred to a labour court provided it is not likely to affect more than 100 workmen. It is argued for the management by Mr. Varadachari that the workmen of this concern are more than 100 in number and that as they are the parties to this dispute as mentioned in the order of reference, the proviso will have no application to this case. I am unable to see any force in this argument because what is required under the proviso is not the number of persons who raise the dispute but the number of persons who are likely to be affected by the dispute. Though this dispute appears to have been raised by the workmen of this concern who may be more than 100 in number, the actual persons affected by it are only the working journalists who are less than 100. It is not stated that there are more than 100 working journalists. I am therefore of the view that the reference is quite valid and that this Court has jurisdiction to decide this dispute.
12. As all the contentions raised by the management are found against them, I hold that the management was not justified in not granting increments to the working journalists from 1954 and that they are entitled to the increment mentioned in the scales of pay fixed for the several grades in 1951. The reference appears to presume that increments were not given even in the year, 1953. Even according to both sides, the working journalists were granted increments in 1953 and it was only from 1954 that increments have been withheld and they have to be given. I have already stated that the working journalists do not press their claims for arrears of increments prior to the date of reference and that they are satisfied if their salaries are fixed as on the date of the reference taking into account the increments which they would have drawn had they been granted in the usual course. The management is therefore directed to fix their salaries accordingly and pay only what is due to them from the date of the reference of course deducting the salaries actually paid. This will be without prejudice to the claims of the working journalists under the decisions of the Wage Board. As already mentioned by me, the management is bound only to fix the salaries of each working journalist according to the grade applicable to him and that they are not compelled to give automatic promotions to the next higher grades and fix the salaries in higher grades. I pass an award on the above lines and it shall come into force after thirty days of its publication in the Fort St. George Gazette. Having regard to the circumstances of this case, I direct each party to bear its own costs.