Madras High Court Upholds Arbitral Award Granting Relief To 93 Chennai Port Spillage Workers

The Madras High Court on Wednesday rejected a petition filed by the Chennai Port Authority, refusing to set aside an arbitral award that directed the port to reinstate spillage-handling workers and grant back wages, gratuity and other service benefits to 93 workers.

A single bench of Justice N Anand Venkatesh held that the award did not suffer from any jurisdictional error or patent illegality and did not conflict with public policy.

The court observed that the Port Trust, as a State instrumentality, is “is expected to act with a higher degree of fairness than ordinary employers”.

The dispute goes back more than four decades. In 1981, the Chennai Port Trust engaged workers to clear iron ore spillages inside the port. Initially around 160 workers were employed for this purpose. In the early 1990s, the Port Trust asked these workers to form an association, later registered as the Madras Port Spillages Handling Workers Association, through which their engagement continued.

The workers maintained that despite this arrangement, they worked under the supervision and control of the Port Trust and performed the same duties year after year.

In 2011, while dealing with public interest petitions on pollution caused by dusty cargo, a Division Bench of the Madras High Court ordered that coal, iron ore, and other dusty cargo be shifted from Chennai Port to Ennore Port. Importantly, the bench directed that not a single employee should be retrenched or made to lose their livelihood because of the cargo shift.

Despite this, the Chennai Port Trust terminated the workers' engagement in December 2012 and later again in August 2016.The litigation moved through the High Court before reaching the Supreme Court of India. The Supreme Court held that the dispute involved contested questions of facts and referred the matter for arbitration.

Pursuant to the apex court's directions, a sole arbitrator, former Supreme Court judge Justice F.M. Ibrahim Kalifulla, was appointed. In an award dated June 14, 2023, the arbitrator granted relief to 93 workers.

In the award, the workers were grouped into three categories, those who had died, those who had retired, and those who still had service left. Workers who were eligible for reinstatement were reinstated into service. Others were granted back wages, gratuity and other benefits.

Aggrieved, the Port authority approached the High Court challenging the award.

It further contended that issues such as reinstatement and unfair labour practices could be decided only by industrial tribunals.

It was also argued that reinstatement was contrary to settled law on public employment and amounted to unlawful specific performance.

Senior counsel appearing for the workers contended that earlier High Court orders had expressly barred any retrenchment and that the arbitrator's conclusions were based on evidence and binding directions of the Supreme Court.

Upholding the award, the High Court noted that the arbitral tribunal had clearly found, on the basis of documentary material, that the association was formed at the behest of the Port Trust.

The court accepted the finding that the workers were under the “supervision and control” of the Port Authority and said the arbitrator had balanced the rights of workers who had served the port for decades. The bench also recorded that the Port Authority had participated in the arbitration without raising any jurisdictional objection at the appropriate stage and could not later “turn around and question the very forum whose jurisdiction it had accepted.”

Finding no patent illegality or violation of public policy, the High Court dismissed the petition and upheld the arbitral award, directing the Chennai Port Authority to implement the directions relating to payment of arrears and protection of the workers' service conditions.

Case Title: The Chairperson, Chennai Port Authority v. V. Manoharan & Ors.

Citation: 2026 LiveLaw (Mad) 18

Citation : 2026 LLBiz HC (MAD) 9

Case Number: Arb O.P(COM.DIV.) No. 509 of 2023

For Petitioner: Additional Solicitor General. A.R.L. Sundaresan,

For Respondents: Senioer Advocates R Vaigai, V Prakash and K M Ramesh.

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