Supreme Court Affirms Uttarakhand HC Judgment On Regularisation Of UNPL Workers

The Supreme Court recently upheld the 2018 judgment passed by the Uttarakhand High Court which directed that the Uttarakhand Purva Sainik Kalyan Nigam Limited (UPNL) workers are employees of the State.

On November 12, 2018, the High Court passed several directions including regularisation of the UPNL employees, who have served for 10 years or more, in a phased manner within 1 year as per various regularisation schemes framed from time to time. It held that the UPNL workers were entitled to get a minimum pay scale with dearness allowance along with arrears to be paid within 6 months.

For context, the present-day UPNL was established by the State Government in 2004 to employ ex-servicemen and their dependents.

A bench of Justices Vikram Nath and P.B. Varale passed the order affirming the rights of UPNL workers. 

Brief background

Various petitions were filed by the UPNL workers before the High Court seeking minimum of pay scale. In one of the cases, the High Court on November 29, 2017 directed State authorities to pay workers appointed on a temporary basis minimum pay scale for the post of Lab Technician.

This was challenged by the State before the division bench of the High Court, which was dismissed on June 12, 2018. The State filed a special leave petition before the Supreme Court, which came to be dismissed by a three-judge bench on November 2, 2018.

The State preferred another SLP before the Supreme Court without placing the November 2 order of dismissal. In this SLP, vide order dated November 13, 2018, the Supreme Court issued notice and granted a stay of operation of the June 12 order.

Arguments of the parties

In the present case, the counsel for the respondents (UPNL workers) alleged that the November 13 order was a result of 'suppression' and 'misrepresentation' of facts that a three-judge bench of the same Court had already dismissed the SLP.

As per the respondent's plea, the Uttarakhand Government formulated Regularisation Rules, 2013 which provides that employees, who have severed for 10 years, are entitled to regularisation. 

Just because they are contractual employees, their plea for equal pay for equal work cannot be rejected as the services rendered by them are exactly the same rendered by regular State employees.

They relied on the State of Karnataka v. Umadevi (2006), in which it was stated: "The question of regularisation of the services of such employees may have to be considered on merits in the light of the principles settled by this Court in the cases abovereferred to and in the light of this judgment. In that context, the Union of India, the State Governments and their instrumentalities should take steps to regularise as a one-time measure, the services of such irregularly appointed, who have worked for ten years or more in duly sanctioned posts but not under cover of orders of the courts or of tribunals and should further ensure that regular recruitments are undertaken to fill those vacant sanctioned posts that require to be filled up, in cases where temporary employees or daily wagers are being now employed."

As per their plea, the State Government through various orders authorised the State Departments to fill the vacancies through UPNL. It advertised the vacancies, eligible candidates are scrutinised based on the requirements of various departments, and even the reservation in appointment is followed.

After doing the entire process of selection, then only the names of the candidates are sponsored by the UPNL. Therefore, the State is the Principal employer and the UPNL is the recruitment agency of the State.

Against these contentions, the State argued the employees sponsored by UPNL are only outsourced employees, who are appointed in various departments on a need basis and not against any sanctioned or vacant posts.

Their honorarium is also paid by the departments under the head of 'honorarium' and not under 'salary' head. Therefore, their work and responsibilities are also not similar to those of regular employees. Therefore, they cannot said to be State employees and such cannot be regularised.

It was also argued that such employees are appointed without following any procedure, without any advertisement or open competition, their initial appointment is in violation of Articles 14 and 16 of the Constitution. Therefore, their regularisation shall be in violation of law declared in Uma Devi v. State of Karnataka (2006).

Their reliance on Uma Devi was: "It has also to be clarified that merely because a temporary employee or a casual wage worker is continued for a time beyond the term of his appointment, he would not be entitled to be absorbed in regular service or made permanent, merely on the strength of such continuance, if the original appointment was not made by following a due process of selection envisaged by the relevant rules." 

Case Details: The State of Uttarakhand & Ors.v. Kundan Singh & Anr, SLP (C) No. 2388 of 2019

Appearances: Senior advocate Dinesh Diwedi  Abhishek Atrey and Vanshaja Shukla standing Counsel for State of Uttarakhand; Senior advocate JM Sharma and Ankur Yadav AOR for Respondents