1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY O. O. C. J. WRIT PETITION NO.54 OF 2004 WITH WRIT PETITION NO.317 OF 2004 WRIT PETITION NO.54/04 : Hindustan Lever Limited. ...Petitioner. Vs. Hindustan Lever Research Centre Employees' Union. ...Respondent. .... Mr. P.K. Rele, Senior Advocate with Ms.Mitra Das, Mr. Rajesh Rele and Mr. Piyush Shah for the Petitioner. Mr. S. K. Talsania, Senior Advocate with Mr.Kiran Bapat and Danial D'Costa for the Respondent. ..... WRIT PETITION NO.317/04: Hindustan Lever Research Centre Employees' Union. ...Petitioner. Vs. Hindustan Lever Ltd. ...Respondent. ... Mr. S. K. Talsania, Senior Advocate with Mr.Kiran Bapat and Danial D'Costa for the Petitioner. Mr. P.K. Rele, Senior Advocate with Ms.Mitra Das, Mr. Rajesh Rele and Mr. Piyush Shah for the Respondent. ..... CORAM : DR.D.Y.CHANDRACHUD, J. September 26, 2006. ORAL JUDGMENT : 2 A conspectus: I The management of Hindustan Lever Limited and the Union representing the workmen of the Research Centre are before the Court in a challenge to an award of the Industrial Tribunal dated 25th August 2003 upon a reference to adjudication under Section 10 of the Industrial Disputes Act, 1947. The dispute centers around a demand made by the Union on behalf of Laboratory Assistants engaged at the Research Centre at Andheri for a classification of their grades in parity with those granted to the Laboratory Assistants of the same management in the factory at Sewri. The grades of Laboratory Assistants in the establishment at Sewri were revised by an award of the Industrial Tribunal dated 22nd June 1984 and the Laboratory Assistants were directed to be placed in Grade T-1, on the basis that the work that was being rendered had ceased to be manual and was technical in nature. The award of the Industrial Tribunal was confirmed by this Court and by the Supreme Court. Until the award was implemented by the management in or about December 1995, there was admittedly a parity of service conditions between the workmen at the Research Centre and those in the factory at Sewri as well as the 3 Head Office. This parity, it is again an admitted position, had continued to subsist between 1958 when the Research Centre was established, until the management while implementing the award in favour of the Laboratory Assistants at the factory declined to extend the same benefits to the Laboratory Assistants at the Research Centre. On a reference to adjudication, the Industrial Tribunal has held that the Laboratory Assistants at the Research Centre are entitled to a continuation of the parity of classification with their counterparts in the factory at Sewri and that the content and quality of the respective job functions being similar, no justification for disturbing the parity that existed as a historical fact, for several decades, has been made out by the management. The management has moved this Court in a substantive challenge to the award. The Union on its part is aggrieved by that portion of the award by which the Industrial Tribunal has directed the implementation of the award from the date of the reference and not from a date anterior thereto. 2. Upon the petition of the management being admitted on 21st April 2004, an ad-interim stay of the operation of the award was refused but, there was a direction to the effect that in the event 4 that the management succeeded before this Court, the amount which was paid over to the workmen would be deducted together with interest at the rate of 12% per annum. The award has been implemented and payments have been disbursed to the workmen. 3. For the reasons which will now be elaborated, this Court has arrived at a determination, having heard Counsel appearing on behalf of the management and the workmen, that the award of the Tribunal does not warrant interference under Article 226 of the Constitution. II The dispute: 4. The dispute between the management and the workmen in the present case arises out of an order of adjudication by the Industrial Tribunal pursuant to a reference by the State Government of the following dispute : “Union demands that the grades of the Laboratory Assistants working at the Research Centre shall be upgraded as per the new grades awarded by the Industrial Tribunal in reference IT No.37 of 1976 to the Laboratory Assistants working at the Sewree Factory. The other benefits as per the award of Industrial Tribunal in reference IT NO.37 of 1976 also should be extended 5 to the Laboratory Assistants working at the Research Centre”. III Parity in Conditions of Service: 5. Hindustan Lever Limited established a Central Laboratory in 1953 at its establishment at the Factory at Sewri, Mumbai. A few years after the establishment of the Central Laboratory, a Research Centre was established in 1958 at the Sewri Factory. Appointments issued to Laboratory Assistants both at the Central Laboratory on the one hand and at the Research Centre on the other, were in similar terms; the appointments being in Grade-I to the post of Junior Laboratory Assistants. The conditions of service of the Laboratory Assistants at both the Central Laboratory and at the Research Centre were identical since the workmen were covered by the same settlement of 1954 and service between the two Sections was transferable. 6. In the year 1967, the Research Centre was shifted from the Factory at Sewri to Andheri. All the Laboratory Assistants who were engaged in the Research Centre came to be transferred on the same terms and conditions of service to Andheri. In 1969, the 6 Factory workmen at Sewri terminated the Industrial settlement of 1964 and preferred a fresh Charter of Demands which was referred to adjudication.1 In 1973, the workmen at the Research Centre also terminated the settlement of 1964 and preferred a fresh Charter of Demands. On 28th November 1973, a settlement was arrived at to govern the Charter of Demands of the workmen at the Research Centre. The management agreed to maintain a parity of service conditions in that the benefit of the industrial adjudication covering the workmen at the Sewri Factory was to govern the Research Centre. In respect of various demands, the settlement contained the following assurance by the management. “In respect of these demands the Company hereby assures the Union that whatever is the ultimate outcome of the adjudication proceedings in References Nos.IT 86/70 and 203/70 before Shri M.G. Chitale, Industrial Tribunal Maharashtra, concerning the Company's workmen in its Factory at Haji Bunder, Sewri, will be extended to the employees in Research Centre, where applicable. It is clarified that the demand concerning incentives which is pending adjudication in the above Reference IT 86 has no applicability to Research Centre.” Clause 5 of the settlement also provided thus: “It is agreed that the period of this settlement will be the same as would apply to the workmen in the Company's 1 Reference Nos.86 and 203 of 1970 7 factory at Haji Bunder, Sewri, as a result of the ultimate outcome of the adjudication proceedings in the above Reference IT 86/70 and 205/70. It is also agreed that if during the pendency of this settlement any benefit accrues to the workmen in the Company's factory at Haji Bunder, Sewri in respect of the demands 5, 6, 7, 8, 9 and 10 in the Union's letter of 24th August 1973, either as a result of any future settlement or award, this will be extended to the employees in Research Centre.” 7. On 8th August 1974, the reference to adjudication on the Charter of Demands of the workmen at Sewri Factory was disposed of by an award of the Industrial Tribunal (Chitale Award). It is an undisputed position that the Laboratory Assistants were also covered by the award. In 1974, the benefits of the Chitale Award came to be extended to the workmen at the Research Centre including the Laboratory Assistants in accordance with terms of settlement dated 28th November 1973 noted above. 8. The Chitale Award was terminated in 1975 by the workmen at the Sewri Factory. On their part, the workmen at the Research Centre terminated the settlement of 28th November 1973 on 15th September 1975. A fresh Charter of Demands was raised 8 in 1975 by the workmen at Sewri Factory on the one hand, and by the workmen at the Research Centre on the other. On 11th May 1977, the workmen at the Sewri Factory signed an Industrial settlement and parties jointly requested the State Government to refer certain demands for adjudication under Section 10 of the Industrial Disputes Act, 1947. A reference was accordingly made by the State Government on 26th May 1977 (Reference IT 123 of 1977). A parallel development had taken place on 7th July 1977 by which the management and the workmen at the Research Centre entered into a settlement. Clause 2(a) of the settlement provided that the management had agreed to extend the interim settlement arrived at for the Factory to the employees of the Research Centre at Andheri. Clause 3 of the Settlement inter alia provided that the ultimate outcome of the the adjudication proceedings concerning the factory workmen will be extended to the employees at the Research Centre. The management had in that adjudication claimed a ceiling on dearness allowance and it was accordingly clarified that the final outcome of the adjudication proceedings on the demand of the management with regard to dearness allowance would also be binding on the workmen and the management. Clause 4 of the Settlement contained a provision in 9 regard to classification which will form the subject matter of some discussion in this judgment at a subsequent stage. Hence it is not being referred to specifically here. 9. On 21st April 1979, the management and the workmen at the Sewri factory arrived at a settlement in respect of certain demands that had been referred to adjudication in Reference 123 of 1977. Adopting the terms of the settlement, the Industrial Tribunal on 27th April 1979 passed a Part-I Award in terms thereof. Close on the heels of the settlement that was arrived at for the Sewri Factory, on 11th May 1979, the management and the workmen at the Research Centre agreed to the extension of the same benefits at the Research Centre. This agreement was embodied in the Minutes of a decision taken on 11th May 1979 to the following effect : “1. The parties referred to the settlement dated 7th July, 1977, between the Company and the workmen employed in the Company's Research Unit at Andheri. They noted the recent settlement dated 21st April, 1979, between the Company and its workmen employed in the Bombay Factory of the Company covering hourly-rated staff. They also noted the order of the Industrial Tribunal dated 27th April 1979, giving an award in terms of the above Bombay Factory settlement dated 21st April 1979. -2. In terms of paragraphs 3 and 4 of the 10 settlement dated 7th July 1977, it was agreed that the terms and conditions of the Bombay Factory settlement will be extended, whenever applicable to the corresponding categories of workmen in Research Unit, and it is understood that this settlement will be operative upto 31st December, 1981, in respect of these categories of workmen in Research Unit. -3. Arrears on account of the above will be paid on or before 12th June, 1979.” (emphasis supplied). At this stage, it would be material to note that the benefits which were envisaged in the settlement of 21st April 1979 for the Hourly Rated Staff at the Factory were extended fully to the employees at the Research Centre including the Laboratory Assistants. The decision that was arrived at between the management and the workmen was that the terms of the settlement for the Sewri Factory will be extended to corresponding categories of the workmen at the Research Centre. It is an undisputed position before the Court that the benefits under the Part-I Award that were given to the Laboratory Assistants at the factory were also extended to the Laboratory Assistants at the Research Centre. Obviously, this was on the footing that the Laboratory Assistants at the Research Centre constituted a corresponding category to the Laboratory Assistants at the Sewri Factory. 11 IV The dispute relating to reclassification : 10. The Laboratory Assistants engaged in the factory at Sewri had demanded a reclassification of their grades. The Laboratory Assistants in the Factory at Sewri were placed in Grades I, K and M and the demand was for placement in what is known as T-Grades. On 13th January 1976 this demand for reclassification was referred for adjudication to the Industrial Tribunal in Reference (IT) 37 of 1976. During the pendency of the adjudication proceedings in Reference (IT) 37 of 1976 (which related to classification of Laboratory Assistants) and Reference (IT) 123 of 1976 (relating to the remaining demands in the Charter of 1976) the Hourly Rated Workmen, including the Laboratory Assistants at the Factory terminated the earlier Award and Settlement and raised a fresh Charter of Demands. On 3rd February 1982, a Charter of Demands was submitted on behalf of the employees at the Research Centre. In response to a letter addressed by the Union to the Assistant Commissioner of Labour, the management had this to say in a letter dated 29th December 12 1982: “Another point which is worth mentioning is that it was by virtue of settlement in November 1973 with the Bombay Labour Union that we extended to the Research Centre the terms and conditions of employees as awarded by the Industrial Tribunal in our Bombay Factory. On expiry of the Award, the Bombay Labour Union again submitted a Charter of Demands and after your department went into the demands it thought it fit to close the matter. However, we extended to the Research Centre the terms and conditions that we had arrived at by virtue of a settlement in our Sewri Factory in 1979. What is important to note here is that the present terms and conditions are on the basis of settlement we had in our Bombay Factory. As is well known, particularly arrangements such as wages, classification etc. are long term arrangements and simply because an Award expires or settlement expires it does not give sufficient justification for the union to raise its demand again and again as a ritual. ” (emphasis supplied). The management, therefore, clearly conceded the position that the same benefits that were extended to the employees at the Bombay Factory were being extended to the employees at the Research Centre. The management, it is important to note, accepted the position that arrangements such as wages and classification “are long term arrangements” (which do not provide a justification for fresh demands merely because a settlement or award has expired). 13 11. On 17th January 1983 during the pendency of the two References to adjudication in respect of the workmen at the Sewri factory, a settlement was arrived at in respect of the demands raised in 1982 for the Hourly Rated Workmen including Laboratory Assistants. The Union at the Research Centre and the management similarly accepted the settlement in respect of the demands raised in 1982 for the Hourly Rated workmen including the Laboratory Assistants. There is no factual dispute about the position that the management extended the same benefits that were given to the workmen at the Sewri Factory by the settlement of 17th September 1983 to the workmen at the Research Centre. At the stage when the settlement was entered into for the Research Centre on 1st December 1983, an adjudication was still pending in respect of the demands for classification made by the Sewri workmen. According to the Union, it was in these circumstances that the workmen, in the settlement at the Research Centre did not press the demands for reclassification, pending the final outcome of the adjudication proceedings. 12. On 20th November 1985 during the pendency of the adjudication in Reference (IT) 123 of 1977, a settlement was 14 entered into by the management with the monthly paid workmen at the factory. A corresponding agreement was entered into on 10th January 1986 extending to the employees of the Research Centre the benefits of the settlement of 20th November 1985. 13. On 22nd June 1984, the Industrial Tribunal passed an award in Reference (IT) 37 of 1976 and granted the demands made on behalf of the Laboratory Assistants at the Sewri establishment for being placed in the T-1 Grade. The petition filed by the management to challenge the award of the Industrial Tribunal in Reference (IT) 37/76 (the Rane Award) was admitted and the implementation of the award was stayed. The petition was eventually dismissed by a Learned Single Judge of this Court by a judgment and order dated 23rd January 1989. The judgment of the Learned Single Judge was confirmed in appeal by the Division Bench. A Special Leave Petition filed against judgment and order of the Learned Single Judge was dismissed by the Supreme Court. The Laboratory Assistants at the Research Centre had made a demand for reclassification of their grades on 3rd July 1986. The Rane Award in respect of the Laboratory Assistants at the Sewri establishment attained finality after the dismissal of the 15 Special Leave Petition by the Supreme Court. On 4th June 1991, the Union representing the Laboratory Assistants at the Research Centre reiterated its earlier demand of 3rd July 1986 for the extension of the same benefits to the Laboratory Assistants at the Research Centre. It may be noted that the management implemented on 1st January 1992, the Rane Award by placing the Laboratory Assistants in the Sewri Factory in T-1 Grade. This benefit was given with effect from 13th January 1976 in terms of the Rane Award together with the payment of arrears. In 1992, however, the management did not accept the demand of the Laboratory Assistants at the Research Centre for being granted a parity of classification with the Laboratory Assistants in the Sewri Factory. A demand was made for a reference to adjudication which ultimately resulted in Reference (IT) 96 of 1992. V 14. As noted in the earlier part of this judgment, a separate Reference, Reference (IT) 123 of 1977 was made by the State Government in respect of various demands of the workmen at the Sewri Factory. Pending a final adjudication thereof, the Industrial Tribunal had passed a Part-I Award on 27th April 1979 in terms of the settlement between the parties. As noted earlier, the same 16 benefit came to be given to corresponding categories of workmen at the Research Centre by an agreement of 11th May 1979. The proceedings arising out of Reference (IT) 123 of 1977 had resulted in an order of the Supreme Court dated 26th July 1994 remanding back the reference. Eventually, on 24th March 1995 a final award was passed by the Industrial Tribunal upon remand. The benefits of the final award were extended to the Laboratory Assistants working at the Sewri Factory in December 1995 with retrospective effect from 1st October 1979. The grievance of the Union at the Research Centre was that even though the management had specifically agreed by the settlement of 1977 and by the Minutes of the agreement dated 11th May 1979 to extend the wage scales and other benefits governed by the final award in Reference (IT)123 of 1977 to the workmen at the Research Centre, the management eventually refused to do so after the final award came in Reference (IT) 123 of 1977. VI The Award: 15. Adjudication proceedings took place before the Industrial 17 Tribunal in Reference (IT) 96 of 1992 to which the present dispute relates. Evidence was adduced on behalf of the Union in support of its plea that there was historically a parity in the conditions of service governing the workmen at the Research Centre with those at the Sewri Factory. Evidence was also adduced in regard to job content and the nature of the functions discharged by the Laboratory Assistants at the Research Centre and their counterparts at the Sewri Factory. The Industrial Tribunal by its award dated 25th August 2003 held that as a matter of historical fact, there existed a parity in the conditions of service between the two establishments. The Tribunal on a review of extensive evidence that was adduced before it came to the conclusion that the responsibilities and functions of the Laboratory Assistants at the Research Centre were similar to those at the Sewri Factory and that there was no justification on the part of the management in denying to the former, the benefits of the Rane Award. In consonance with the Rane Award, governing Laboratory Assistants at the Sewri Factory, the Tribunal granted to the Laboratory Assistants at the Research Centre, the benefits of an upgradation to T-1 Grade but with effect from the date of reference. 18 VII Submissions: 16. On behalf of the management, Senior Counsel conceded the position that right from the inception of the Research Centre, there was a parity in the conditions of service between the employees engaged in the Factory and those at the Research Centre and the Head Office. The submission, however, that was urged on behalf of the management, was that a parity of service conditions is not sufficient to justify a parity of classification and the Reference before the Tribunal was not in regard to the former, but the latter. The submission of Counsel was that a mere similarity of nomenclature, or for that matter, even a similarity of work is not sufficient to sustain a plea of equal pay for equal work. It was urged that the Tribunal had formulated the correct test in law which was whether, having regard to the educational qualifications prescribed, responsibilities placed and the actual work required of the Laboratory Assistants at the Research Centre, the same classification that governed their counterparts in the Sewri establishment should be applied. However, it was submitted that having laid down the correct test, the Tribunal misdirected itself by placing emphasis on the parity of service conditions. Counsel 19 submitted that the Tribunal (i) Ignored the difference between the Research Centre and Sewri Factory; (ii) Placed undue emphasis on the Standard Operating Procedures and the Manuals; (iii) Ignored the statement in the settlement of 1977 that it did not govern the issue of classification; (iv) Ignored the fact that the demand for reclassification was dropped in the settlement of 1983 which was to remain in force until 30th June 1986; and (v) Ignored the material difference on the basis of which Rane Award came to be delivered. 17. On the other hand, on behalf of the Union, it has been urged that (i) As a matter of historical fact, parity has always existed in all respects both in respect of classification and service conditions between the workmen of the Research Centre and the workmen of the Factory and the Head Office; (ii) The existence of this parity finds recognition in a final and binding judgment of a Learned Single Judge of this Court; (iii) The basis on which the Rane Award upgraded the classification of the Laboratory Assistants in the Sewri Factory is equally applicable to the conditions prevalent for the Laboratory Assistants in the Research Centre; (iv) The nature of the duties, responsibilities and job 20 content of the Laboratory Assistants at the Research Centre was demonstrated by cogent evidence to be similar to those of their counterparts at Sewri; and (v) In view of the existence of a parity which held the field for over 35 years, the management had not discharged the onus of establishing a valid and proper justification for disturbing this parity. VIII 18. In considering the rival submissions that have been urged before the Court, it merits emphasis that the reference to adjudication before the Tribunal was on the demand of the Laboratory Assistants working at the Research Centre to the effect that their classification should be upgraded in accordance with the award of the Industrial