Employers Can't Dispute Employees' Date Of Birth At Fag End Of Their Service : Supreme Court

The Supreme Court has held that the rule that employees cannot raise a dispute relating to date of birth at the fag end of their service is equally applicable to employers as well.

A bench comprising Justices DY Chandrachud and Aniruddha Bose set aside the decision of Hindustan Copper Ltd, a Public Sector Undertaking, to reduce the VRS benefits to an employee by altering his date of birth.

The employee's stand was that his date of birth is September 21, 1949. However, the employer reckoned his date of birth as September 21, 1945 for computing the benefits of Voluntary Retirement Scheme (VRS). If the latter date, i.e. 21st September, 1949 was accepted by the employer to be his date of birth, his financial benefits from the said scheme would have been higher, as he would have had longer service tenure left.

He approached the High Court challenging the company's action. After being unsuccessful there, he approached the Supreme Court. The High Court had held that there were no records to prove that his date of birth was in 1949.

The admitted position was that 21st September 1949 was recorded as his date of birth in his service book. This was opened in 1975.The appellant claimed that at the time of his voluntary retirement, he came to learn for the first time that his date of birth was being changed to 21st September 1945. The "Form B" in the records reflected the 1945 date of birth. The employer maintained that the entry in the service book was an error which was corrected later.

The Supreme Court observed that "the authorities proceeded in this matter in a rather mechanical manner and embarked on a unilateral exercise of correcting the age entry in the service book on their perception that an error was being corrected".

"This exercise was conducted without giving any opportunity of hearing to the appellant and at the fag end of his service tenure. Otherwise, various documents including the L.I.C. policy consistently reflect 21st September 1949 to be the appellant's birthdate", the Court observed.

"This is not a case where a workman is seeking to change his date of birth to his benefit at the end of his career. This is a case where the employer is altering the records at the end of the career of the workman to his detriment on taking unilateral decision that the date of birth specified in the appellant's service book was erroneous, relying on a date disclosed in a statutory form", the Court noted.

The Court observed that the employer changed the date of birth without giving an opportunity of hearing to the employee. The Court added that VRS benefits are covered under the Right to Property under Article 300A of the Constitution.

"VRS benefit is an entitlement and assumes the character of property to the employee concerned once his application for VRS is accepted. It is the right of a person under Article 300A of the Constitution of India to have the VRS benefit to be given on accurate assessment thereof, the employer here being a public sector unit. If at the time of quantifying the VRS benefit after accepting an employee's application for voluntary retirement, the employer take any step that would reduce such benefit in monetary terms, such step shall have to be taken under the authority of law.

We find the action of the employer lacking in authority of law in this case on two counts. First, it fails for not adhering to the principles of natural justice. The decision not to follow the service book recordal was taken without giving an opportunity of hearing to the appellant. The opportunity of hearing of the appellant also accrued because the employer themselves had proceeded on the basis that the later date i.e., 21st September 1949 was the birthdate of the appellant and this was a long established position. Moreover, since in the own records of the employer two dates were shown, under normal circumstances it would have been incumbent on their part to undertake an exercise on application of mind to determine in which of these two records the mistake had crept in. That process would also have had to involve participation of the appellant, which would have been compatible with the principles of natural justice.

There are several authorities in which this Court has deprecated the practice on the part of the employees at the fag end of their career to dispute the records pertaining to their dates of birth that would have the effect of extension of the length of their service. The very reasoning on which an employee is not permitted to raise age­-correction plea at the fag end of his service to extend his tenure should also apply to the employer as well. It is the employer here who had proceeded on the basis of age of the appellant reflected in his service book during the latter's service tenure and they ought not to be permitted to fall back on the Form "B" which would curtail the VRS benefit of the appellant".

Allowing the appeal, the Court directed the respondents to extend the benefits of VRS to the appellant treating his date of birth as 21st September 1949.Such benefits shall be extended to him within a period of four months, upon deducting therefrom the sum already paid to him. The differential amount shall carry simple interest at the rate of seven percent (7%) per annum to be computed from 3rd October 2002, being the date on which he was released from service, till the date of actual payment to him in terms of this judgment. 

Case Title : Shankar Lal versus Hindustan Copper Ltd and others

Citation : 2022 LiveLaw (SC) 407

Head Notes

Voluntary Retirement Scheme - VRS benefit is an entitlement and assumes the character of property to the employee concerned once his application for VRS is accepted. It is the right of a person under Article 300A of the Constitution of India to have the VRS benefit to be given on accurate assessment thereof, the employer here being a public sector unit. If at the time of quantifying the VRS benefit after accepting an employee's application for voluntary retirement, the employer take any step that would reduce such benefit in monetary terms, such step shall have to be taken under the authority of law (Paragraph 21).

Service Law - There are several authorities in which this Court has deprecated the practice on the part of the employees at the fag end of their career to dispute the records pertaining to their dates of birth that would have the effect of extension of the length of their service. The very reasoning on which an employee is not permitted to raise age­-correction plea at the fag end of his service to extend his tenure should also apply to the employer as well(Paragraph 21).

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