No Right To Regularization For Casual Workers Without Proper Recruitment Process: Delhi HC

Background

Manoj Kumar, employed as a sweeper by PNB between September 1993 and December 1997, was terminated without notice in January 1998. Kumar filed an industrial dispute challenging his termination as violative of Section 25F of the Industrial Disputes Act, 1947 (ID Act). The Central Government Industrial Tribunal-cum-Labour Court ruled in his favor, granting reinstatement with full back wages, though denying his plea for regularization. PNB, in its writ petition, challenged the order of reinstatement, while Kumar sought regularization of his services. The court heard both petitions together.

Arguments

PNB contested the tribunal's order on several grounds: Firstly, it argued that Kumar was employed purely on an ad-hoc basis, without formal recruitment, and his engagement was a stopgap arrangement, not regular employment. His appointment lacked the procedure mandated by the Shastri and Desai Awards governing banking employment. Secondly, that the tribunal erred by ordering reinstatement despite finding no material supporting Kumar's formal appointment. PNB cited the Supreme Court's judgment in State of Karnataka v. Uma Devi (2006) 4 SCC 1, which held that casual workers are not entitled to regularization, and Jagbir Singh v. Haryana State Agriculture Marketing Board (2009) 15 SCC 327 to argue that in cases of illegal termination under Section 25F of the ID Act, compensation is the appropriate relief, not reinstatement with full back wages.

Manoj Kumar, represented by Mr. Barun Kumar Sinha, argued that his termination violated Section 25F of the ID Act, as no notice or compensation was given. Kumar further contended that he was eligible for regularization, having served continuously for more than four years. He pointed out that similarly situated sweepers had been regularized and argued that PNB's refusal to regularize him was arbitrary and discriminatory, in violation of Article 14 of the Constitution of India. Kumar's counsel further argued that under the principle laid down in Uma Devi, the court should consider regularization as a one-time measure for workers who have been employed for over ten years.

Court's Reasoning

The court examined two key issues: (1) whether Manoj Kumar was entitled to reinstatement with full back wages, and (2) whether the tribunal erred in denying regularization of his services.

On the first issue, the court found that while Kumar's termination violated Section 25F of the ID Act, reinstatement was not the automatic remedy. The court noted a shift in judicial opinion, where courts now prefer granting monetary compensation rather than reinstating ad-hoc or temporary employees whose services were terminated due to procedural defects. Citing Jagbir Singh v. Haryana State Agriculture Marketing Board, the court emphasized that reinstatement with back wages is no longer automatically granted in cases involving casual workers. Instead, compensation should meet the ends of justice. Applying this principle, the court concluded that reinstating Kumar, who was employed on a stopgap basis and not formally recruited, would be inappropriate. The tribunal's order of reinstatement was set aside, and in its place, the court awarded Kumar Rs. 2.5 lakh as compensation.

On the second issue of regularization, the court upheld the tribunal's denial of regularization. It reiterated the Supreme Court's ruling in Uma Devi, which established that casual or temporary workers cannot claim regularization unless their appointment followed a proper recruitment process. The court underscored that mere continuation in service does not confer a right to regularization. Furthermore, the court observed that Kumar's appointment was not made against any sanctioned post and that his service was on a purely temporary basis. Justice Singh found no evidence that Kumar's employment followed the bank's recruitment policy, and thus, his claim for regularization could not be sustained. The court also noted that Uma Devi allows for regularization only as a one-time measure for employees who have served more than ten years, which was not applicable in Kumar's case, as he had only served for four years.

The court further dismissed Kumar's argument that his juniors had been regularized, holding that public employment must adhere to the principles of equality and due process, as mandated by Articles 14 and 16 of the Constitution. Thus, the court, while recognizing the wrongful nature of Kumar's termination, found that reinstatement was not an appropriate remedy and instead awarded him monetary compensation.

Date: 16 October 2024

Citation: 2024:DHC:7993

Counsel for the Petitioner (PNB): Mr. Swarnil Dey

Counsel for the Respondent (Manoj Kumar): Mr. Barun Kumar Sinha with Mrs. Pratibha Sinha and Mr. Sneh Vardhan