Absence Of Proof In Employee's Engagement In Dual Employment, Kerala HC Directs Employer To Pay Salary

Background Facts

The respondent was employed by Quattro Investments Pvt. Ltd. as an Area Sales Manager starting from March 3, 2009. His compensation included a monthly salary of ₹22,000 and ₹20,000 per month for expenses. The respondent claimed that he was not paid his salary, prompting him to resign from his position. He subsequently filed a claim petition (No. 19/2011) with the Labour Court in Ernakulam, seeking arrears of salary amounting to ₹2,58,000.

In the Labour Court, the respondent provided evidence, including his testimony and documents, to support his claim. The Labour Court ruled in favor of respondent, ordering the Managing Director (MD) of Quattro Investments Pvt. Ltd. (Petitioner) to pay the arrears of ₹2,58,000 with 9% interest per annum from the date of the order until the amount was paid. Aggrieved by the same, MD approached the High Court of Kerala, challenging the Labour Court's order.

It was contended by the MD that respondent did not qualify as a "workman" under Section 2(s) of the Industrial Disputes Act. They argued that his role as an Area Sales Manager was supervisory and managerial, which excluded him from being classified as a workman. The MD asserted that respondent had a fixed annual salary of ₹2,64,000, and in addition, he was entitled to performance-based incentives. This compensation structure was presented to argue that his role was not that of a workman.

It was alleged by the MD that respondent was employed by another company during his tenure with Quattro Investments Pvt. Ltd. This contention was used to challenge the legitimacy of his claim for salary arrears. The MD claimed that respondent did not submit a formal resignation letter as alleged. This was aimed at questioning the validity of his resignation and subsequent claim for unpaid salary. It was further argued that respondent did not provide daily or weekly performance reports during his employment, which was used to question his work commitment and performance. The MD invoked the principle of "no work, no pay," suggesting that respondent was not entitled to salary arrears for the period he allegedly did not work.

It was contended by the respondent that he fell within the definition of a "workman" under Section 2(s) of the Industrial Disputes Act, despite the MD's assertions to the contrary. He maintained that his duties and responsibilities were in line with those of a workman rather than a supervisory or managerial role. The respondent refuted the MD's allegation that he was employed by another company during his tenure with Quattro Investments Pvt. Ltd. It was argued that there was no oral or documentary evidence to support the claim of dual employment. It was highlighted by the respondent that the MD failed to provide substantive evidence to prove that respondent was performing a supervisory role or was engaged in dual employment.

Findings of the Court

It was observed by the court that the MD failed to provide sufficient evidence to support their claim that respondent did not qualify as a "workman" under Section 2(s) of the Industrial Disputes Act. There was no material evidence presented to prove that respondent's role was supervisory or managerial in nature.

It was noted by the court that although the MD presented an appointment letter indicating an annual salary of ₹2,64,000, this alone was not enough to establish that respondent's role excluded him from being classified as a workman. The court found no evidence on record to demonstrate that respondent was employed by another company during his tenure with Quattro Investments Pvt. Ltd. It was highlighted by the court that the MD did not examine any witnesses or produce any documentary evidence in the Labour Court to substantiate their claims against respondent. The lack of evidence from the MD weakened their case and supported the Labour Court's findings.

It was further observed by the court that the principle of 'no work no pay' was not applicable in this case, as there was no evidence to suggest that respondent did not work during the period for which he claimed salary arrears. It was found by the court that the Labour Court had properly appreciated the evidence and materials on record to arrive at its decision. The Labour Court's order directing the MD to pay ₹2,58,000 in salary arrears, along with 9% interest per annum from the date of the order till realization, was deemed appropriate and legally justified.

With these observations, the petition filed by the Managing Director of Quattro Investments Pvt. Ltd. was dismissed. The Labour Court's order confirming that respondent was entitled to the claimed salary arrears and interest, was upheld by the High Court.

Case No. : OP(LC) NO. 2019 OF 2013

Counsel for the Petitioner : Santhosh Mathew, Arun Thomas, Jennis Stephen Adv.

Counsel for the Respondents : A.K.Preetha