Air India Employees Can't Demand Pre-Decisional Hearing In Economic Policy Matters Like Disinvestment: Madras High Court

While dismissing the plea filed by the Air Corporation Employees Union for the protection of their service conditions in light of Air India's disinvestment, the Madras High Court ventured to discuss the moot points raised in the petition elaborately with reference to the obligations of the employer.Justice V. Parthiban went on to hold that the interests of the employees were sufficiently protected by the measures taken by the Government before and after the signing of the Share Purchase Agreement (SPA) with Talace Private Limited, a special purpose vehicle of Tata Group.On the preliminary question of whether the employees should have been given due notice/ pre-decisional hearing before the signing of the Share Purchase Agreement, the bench referred to Balco Employees' Union vs. Union of India (2002) and All India ITDC Worker's Union vs. ITDC & Ors. (2006). It underlined that employees are devoid of any right to demand a pre-consultation hearing when its a disinvestment policy emanating from the economic decisions of the government. According to the single-judge bench, Articles 14 and 16 does not mean that prior notice of hearing must be given to the workers before a decision is taken to disinvest.In large economic policy decisions like disinvestment in the public sector, the government cannot conduct business while 'sitting in the crossroads with the public' and the requirement of transparency is only limited to the manner in which the decision is made known, Justice V. Parthiban observed."The Courts have recognized larger public interest involved in such policy decisions and have consistently held that judicial review in such matters is almost impermissible except when the decision is stated to be smacked of total arbitrariness, unconstitutional or illegal", the court added.The court refused to accept the petitioner's contentions based on the judgments in H.L. Trehan and Others v. Union of India and Others, (1989) and Balco Captive Power Plant Mazdoor Sangh and Ors. v. National Thermal Power Corporation and Ors. (2007(14) SCC 234). The bench noted that the latter actually challenged the service conditions that were altered and the former judgment was restricted to the factual matrix of the case, not challenging the economic policy taken."The quintessence legal principle viz., law of the land as on date is that an economic policy decision in furtherance of larger public interest cannot be subjected to judicial audit habitually or routinely merely on the ground that there was no opportunity of hearing afforded to the employees. Therefore, it is too late in the day to stall the process of disinvestment merely on such a slippery challenge", the bench underscored.On the second issue of whether employees are required to be given prior notice under Section 9A of the Industrial Disputes Act and whether its absence would vitiate the process of disinvestment or not, the court said that such contentions cannot be countenanced in law. The court specifically referred to the averment that some of the suggestions of the bilateral committee were not there in the Share Purchase Agreement. When the employees raised their apprehensions about the same, it was duly put to rest by the respondent Union Government, the court inferred from the Counter Affidavit and written submissions made on behalf of the Government.Employees' right to be heard is not 'sacrosanct' or 'inviolable' in the face of a 'monumental economic policy decision', the court reiterated its stand in reference to the application of Section 9A."The judicial review in such matters ought to be oriented towards balancing the paramount public interest and the interest of the employees and in such consideration even if this Court finds any infraction in complying with any statutory provisions, public interest must be allowed to prevail"The petitioner had contended that alteration of service conditions pertaining to medical, passage and housing will always be under the scanner of Section 9A and referred to the judgment in Life Insurance Corporation of India v. D.J.Bahadur and Ors (1981) where the court held that LIC Act cannot substitute special legislation governing the service conditions of employees and notice under Section 9A of ID Act was mandatory. Reliance was also placed on Film Factory Workers Union, rep. By its General Secretary v. Government of India, Department of Heavy Industries, (2016) where the Supreme Court held that a settlement between the employer and the workmen is sacrosanct which cannot be government directives even if the company was wholly owned by the Government.Before examining the contention, the court also pointed out that Section 9A was brought in by the petitioner only as a response to the counter and Solicitor General's submission that there was change in employment but merely a change in the share pattern. The petitioner has not resorted to Section 9A previously in the affidavit filed in support of the writ petition, it...

Air India Employees Can't Demand Pre-Decisional Hearing In Economic Policy Matters Like Disinvestment: Madras High Court

Sebin James

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