When Termination Is Found To Be Illegal, Reinstatement With Full Back Wages Shall Not Be Awarded Mechanically: Delhi High Court Reiterates

Background Facts

Ashok Kumar (Workman) was appointed as a daily wage worker in the laundry department of AIIMS 1989. In 1995, the Workman was implicated in a theft case and an FIR was registered under sections 379 and 411 of IPC. Pursuant to the FIR, the Workman was not allowed to join services till the time he was acquitted from all the charges in 2004. In 2007, the Workman made a representation seeking to be taken back in service along with entitlement to regularisation. However, AIIMS did not reply to the representation made by the Workman.

The Workman raised an Industrial Dispute before the Joint Labour Commissioner. The Labour Court passed an award in 2022 and held that the Workman was entitled to a lump sum compensation of Rs.90,000/- in lieu of reinstatement. Thus, the writ petition was filed by AIIMS against the award of the Labour Court.

It was contended by the AIIMS that the Labour Court did not take into account the entire evidence, facts and circumstances before passing the Award. The Workman failed to explain the inordinate delay of 16 years in filing his statement of claim and further the Workman did not state whether he was gainfully employed for the 10 years he claimed to be unemployed. Further daily wage employees and regular employees are two different classed on employees. Thus, the Workman cannot be equated at par with other regular employees employed at AIIMS. It was also argued that the services of the Workman were discharged bearing in mind the charges of theft levied against him and the decision of removal from service is a purely administrative action which cannot be interfered by the court.

Findings of the Court

The court observed that the Labour Court in its award had noted that the services of the Workman were terminated based on the charges of theft levied against him. The Labour Court further noted that the Workman was acquitted from the charges of theft and his co-workers who were similarly situated had been regularized. The Labour Court thus noted that the services of the Workman would've been regularized had he not been falsely charged with theft and thus in the interest of justice, the Workman must be treated at par with his fellow workers.

The court observed that the labour court also noted that since both the parties had lost faith in each other, reinstatement was not in the best interest of the parties and thus a better alternative was grant of compensation in lieu of reinstatement.

The court relied on the judgment of State of Uttarakhand v. Raj Kumar wherein the Supreme Court had laid down as to when the relief of compensation in lieu of reinstalment must be granted by the Labour Court. The Supreme Court in the aforesaid case had held that ordinarily when the termination is found to be illegal, reinstatement with full back wages has to be granted depending upon the facts and circumstances of the case. Such relief must not be awarded mechanically. The Supreme Court had further observed that where termination of a daily-wage worker is found illegal, reinstatement with back wages is not given automatically but the workman must be granted lumpsum monetary compensation.

The court thus observed that compensation is the justified remedy for the Workman whose services were terminated prematurely on account of being falsely implicated in a case for theft. Further the Workman was employed as a daily wagerer but since his similarly situated co-workers have been regularised, it was in the interest of justice to treat him at par with them.

With the aforesaid observations, the court upheld the award of the labour court regarding the lumpsum compensation of Rs. 90,000 and dismissed the writ petition.

Case No.- W.P.(C) 5193/2024 & CM APPL. 21253/2024

Case Name- AIIMS vs Ashok Kumar

Counsel for the Petitioner- Mr. Satya Ranjan Swain, Panel Counsel-AIIMS with Mr. Ankush Kapoor, Advocate

Counsel for Respondents- Nil

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