Dos and Don’ts for a Labour Court as per The Hon’ble Supreme Court

The Hon’ble Supreme Court on 20.09.2018, in the matter of M.L. Singla v. Punjab National Bank and Anr. observed:

When a dismissal order is based on a domestic enquiry, it is obligatory upon the Labour Court to first decide the question as a preliminary issue as to whether the domestic enquiry was legal and proper.  (Para 20)

If the domestic enquiry is legal and proper, the next question which should be considered by the Labour Court is whether the punishment of dismissal from the service is commensurate with the gravity of the charges or is disproportionate, requiring interference in its quantum by the Labour Court.  (Para 22)

If the punishment of dismissal from the service is disproportionate, the Labour Court is entitled to interfere in the quantum of punishment by assigning reasons and substituting the punishment. This, the Labour Court can do by taking recourse to the powers under Section 11­A of the Industrial Disputes Act.  (Para 23)

While deciding the question that whether the punishment of dismissal from the service is commensurate with the gravity of the charges or is disproportionate requiring interference in its quantum by the Labour Court, the enquiry for deciding the question should be confined to the factors such as what is the nature of the charge(s), its gravity, whether it is major or minor as per rules, the findings of the Enquiry Officer on the charges, the employee’s overall service record and the punishment imposed etc. (Para 24)

Where Labour Court comes to a conclusion that the domestic enquiry is illegal because it was conducted in violation of the principles of natural justice thereby causing prejudice to the rights of the employee,  the employer is under legal obligation to prove the misconduct (charges) alleged against the employee before the Labour Court provided he had sought such opportunity to prove the charges on merits. (Para 25)

If the Labour Court finds that the domestic enquiry is illegal because it was conducted in violation of the principles of natural justice thereby causing prejudice to the rights of the employee, then the Labour Court is under legal obligation to give such opportunity and then decide the question as to whether the employer was able to prove the charges against the employee on merits or not.  (Para 26)

In case the charges against the employee are held proved, the next question to be examined is in relation to the proportionality of the punishment given to the employee. (Para 27)

But where the charges against the employee are held not proved, the employee is entitled to claim reinstatement with back wages either full or partial depending upon the case made out by the parties on the issue of back wages. (Para 28)

(Para 30) The Labour Court cannot

  • proceed to examine the findings of the Enquiry Officer on the charges, like an Appellate Court.
  • appreciate the evidence adduced before the Enquiry Officer and the one adduced before it for coming to a conclusion that the findings of the Enquiry Officer are perverse.

It is obligatory upon the Labour Court to first frame the preliminary issueon the question of legality and validity of the domestic enquiry and confine its discussion only for examining the legality and propriety of the enquiry proceedings. (Para 31)

Depending upon the finding on the preliminary issue on the legality of the enquiry proceedings, the Labour Court should proceed to decide the next questions. The Labour Court while deciding the preliminary issue can only rely upon the evidence, which is relevant for deciding the issue of legality of enquiry proceedings but not beyond it. (Para 32)

In order to claim back wages, it is necessary for the employee to plead and prove that he was not gainfully employed after his dismissal with the aid of evidence. (Para 35)

Copy of the Judgement: Judgement 20-Sep-2018

-Tushar Kaushik

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