Case: Hindustan Times Limited, New Delhi Vs. Their Workmen

1. These two appeals by special leave, one by the employer and the other by the workmen, arise out of an industrial dispute that was referred for adjudication to the Industrial Tribunal, Delhi by an order made on January 23, 1958 by the Chief Commissioner, Delhi. The Tribunal made its award on March 16, 1959. Out of the numerous matters that were included in the terms of reference, we are concerned in these appeals only with a few. The employer challenges the award as regards: (1) Scales of pay, (2) Dearness allowance, (3) Adjustments, (4) Leave Rules, (5) Gratuity and (6) Retrospective effect of the award. The workmen also attacked the award as regards the scales of pay and dearness allowance. In addition, they have attacked the award as regards the working hours, leave rules, night shift allowance, retirement age and procedure for taking disciplinary action. At the time of the hearing before us however the learned Attorney-General, appearing for the workmen, did not press their claim For modification of the award as regards night shift allowance, leave rules and procedure for taking disciplinary action and working hours.2. It appears that when the dispute was before the Conciliation Officer, Delhi, for settlement an interim agreement was arrived at between the parties on December 20, 1957 by which the management agreed to give certain interim reliefs, ranging between Rs. 6/- to Rs. 10/- per month from the month of November 1957. On of the terms of the agreement was that this payment "will be adjusted against the final out come of the demands by constitutional means". The Tribunal has in its award given a direction that this interim relief shall remain unaffected. Taking this to be a direction that the adjustment as agreed upon of payments under the interim arrangement shall not be made, the employer has in its appeal challenged the correctness of this direction also.The most important of the matters in dispute are the question of the wage scale, the dearness allowance and the adjustment of existing employees into the new scales. It appears that from 1946 onwards the Companys workmen have had a consolidated wage scale, no distinction being made between the basic wage and the dearness allowance. This wage scale has remained practically unaltered except for some special increments given in the year 1948. By the award the Tribunal has introduced new wage scales for certain existing categories of workmen and in some cases has introduced new scales, after amalgamating more than one category. Thus certain railway despatchers, advertisers, Box No. sorters, filing clerks and bank clerks who were formerly in the scale of Rs. 50- 4-90 EB-4-115 and Junior Clarks etc., who had a scale of Rs. 60-100 EB-1-115 have all been put on a new scale of Rs. 70-5-100 EB-5-150. There has been a similar amalgamation of clerks, assistants, cashiers, record keepers and others some of whom were on Rs. 80-175 and some on Rs. 80-200 scale, all of them being now put on a new scale of Rs. 90-200. In both cases the starting salary has been raised; the maximum has been raised for the first category. Supervisors and others who were formerly on three different scales, some on Rs. 125-350, some on Rs. 125-300, and some on Rs. 100-250, have all been amalgamated and have been put on a new scale of Rs. 100-350. Obviously, this would mean a lower starting salary for some and maximum for some. Job Daftries some of whom were on Rs. 70-115 scale and others on Rs. 100-155 have all been put on a new scale of Rs. 80 to Rs. 155, resulting thus in a lowering of starting salary for some and a rise of a higher maximum for all. A similar lowering in the starting salary has also occurred in cases of some of the job-machinemen. They were formerly on two scales, one of Rs. 100-175 and the other of Rs. 75-175. The Assistant Foreman in the Job Department formerly on Rs. 125-175 are put on a scale of Rs. 125-202. Where there has been no amalgamation the new scale has resulted in a slight increase in some cases both in the starting salary and the maximum. In some catagories, no change has been made at all.

Court's reasoning:
4. It is unnecessary to give more details of the difference between the old scale and the new scale as what has been mentioned above is sufficient to indicate that there has been some change in favour of the workmen, though this charge is not much.On an examination of the tribunals award as regards the wage scale, we are satisfied that all the considerations mentioned above were present in the mind of the adjudicator and we are of opinion that there is nothing that would justify us in modifying the award either in favour of the employer or in favour of themere passage of time and these revolutionary changes would be sufficient to convince any right thinking man of the need for revision of wage scales which, on the face of it, were far below the "living wage" and mostly also below the "fair wage", provided the industry could bear the additional burden. The case for revision becomes irresistible when one takes into consideration the further fact that the cost of living rose steeply during this period. On the basis of 1939 cost as 100, the index for 1946 was 282. By 1958 it had risen to 389. It may be mentioned that since then there has been further rise. Nor can it be seriously suggested that this concern cannot bear the burden of an increased wage scale. The Tribunal was, in our opinion, right in its conclusion that the material on record shows that the Company has been prospering and has financial stability. We have for ourselves examined the balance -sheets and the other materials on the record and have no hesitation in agreeing with that conclusion. Mr. Pathaks uphill task in the face of these balance-sheets already on the record shows that the Company would not be able to bear the burden of an increased wage scale has been made more difficult by the discovery that even after the implementation of the award the Company has made large profits during the years 1959-60, 1960-61 andis reasonable to think that with the progress of education in the country and the increasing news mindedness of the people the future prospects of the Company are no less bright. On a consideration of all this, we are clearly of opinion that Mr. Pathaks contention that the wage scale fixed by the Tribunal is too heavy for the Company to bear, must be rejected.10. Equally unacceptable is Mr. Pathaks next contention that the wage scale fixed by the Tribunal operates unfavorably on this Company vis-a-vis two other concerns in Delhi region, viz., The Times of India, Delhi and the Statesman, Delhi. We have compared the wage scales in these two concerns, viz, The Times of India, Delhi and the Statesman, Delhi, with the wage scale under the award and have for the purpose of comparison taken into consideration the dearness allowance as fixed by the Tribunal. The comparison shows that while in some cases the Company (the Hindustan Times) will have to pay more to its workmen that what is being paid to workmen of the same category by the Times of India, Delhi and the Statesman, Delhi, in several cases it will be less. It has also to be borne in mind that the Times of India, Delhi and the Statesman, Delhi, are much smaller units of the newspaper industry than the Hindustan Times.These companies are mere adjuncts to the Times of India, Bombay and the Statesman, Calcutta, respectively. Therefore, even if for same categories the wage scale under the award is higher than that in the Times of India, Delhi and the Statesman, Delhi, that would be no ground for modifying the award in favour of the Company. We have therefore come to the conclusion that there is no ground whatsoever for modifying the wage scale fixed by the award in favour of theis undoubtedly some force in the contention and it may be said that the Tribunal has been rather cautious in the matter of revision of wage scales. Even so, it has to be remembered that where, as in the present case, the proper principles have been applied by the Tribunal, it is not the practice of this Court to interfere, ordinarily, with details of this nature when exercising its special jurisdiction under Art. 136 of the Constitution. It also appears to us that the very fact that the Tribunal has been cautious in the matter of raising the wage scales has influenced it in the directions it has given onthe question ofadjustment of the present employees into the wage scale. In this way some relief has been given to the present employees which might otherwise have been given by raising the wage scale. On a consideration of all these facts we have reached the conclusion that it will not be proper for us to modify the wage scales fixed by the Tribunal in favour of the workmen also.13. Onthe question ofdearness allowance it is not disputed before us that in the circumstances of the present case the Tribunal acted rightly in awarding dearness allowance at a flat rate for all categories ofargument however overlooks the fact that the reference as regards the dearness allowance was in respect of all categories of workmen, though the reference as regards scales of pay did not cover some categories, viz., mazdoors and canteen boys. They therefore continue to remain on their old scale of Rs. 50-3-85. When the Tribunal in consideringthe question ofdearness allowance was thinking of the starting pay of the lowest paid worker it had obviously these categories in mind. Having concluded that the lowest paid worker should start at Rs. 75/- as the total amount of basic pay and dearness allowance the necessary conclusion reached by the Tribunal was that Rs. 25/- should be fixed as the dearness allowance. It is, in our opinion, proper and desirable that the dearness allowance should not remain fixed at this figure but should be on a slidingare not impressed by thisthese circumstances, we do not see any justification for interfering with the directions given by the Tribunal in the matter ofthe agreement therefore what has been received by the workmen as advance payment at Rs. 6/- or Rs. 7/- or Rs. 8/- or Rs. 10/- per month as interim relief has to be adjusted against what is due to be paid to them under the award. In other words, the Company is entitled under the agreement to deduct the payments made as interim relief from what is payments made as interim relief from what is payments made as interim relief from what is payable to these very employees under the award. The Tribunals direction that the interim unaffected is in effect an order that term (ii) of the agreement need not be complied with. We can find no justification for such an order. While it is true that industrial adjudication can and often has to modify existing contracts between an employer and its workmen, there can be no justification for modification of an agreement of this nature pending final settlement of a dispute such a direction that the solemn words of therepresentatives that interim relief which may be given will be adjusted against the relief finally given need not be complied with is not unfair to the employer but is also not calculated collated to serve the best interests of the workmen themselves. For one thing, an order of this nature in one case by a Tribunal that such an undertaking need not be carried out is likely to hamper interim settlements generally; it is also not desirable that workmen should be encouraged to treat their undertakings as of no value. Industrial adjudication must be careful not to encourage bad faith on the part of the workmen or the employer. A direction as given by the Tribunal in this case that the term in the agreement that payments made will be adjusted against the first outcome need not be complied with is unfortunately likely to have such effect on workmen. We therefore set aside the Tribunals direction that interim relief will remain unaffected and direct that adjustments should be made interim of the said interimappears that at present the Management grants 10 days, casual leave to the business staff and 7days casual leave to all the other categories and there is no sick leave facilityis difficult to see however how the benefit that the workmen will get under this Act can affectthe question ofsickness leave being provided for the workmen. This Act it has to be noticed does not provide for any leave to the workmen on the ground of sickness. It provides in S. 46(1) (a) for periodical treatment of any insured person in case of this sickness if certified by a duly appointed medical practitioner. It is unnecessary to mention here the several provisions in the Act; viz. Sections, 47, 48 and 49 which deal with the eligibility of workmen for sickness benefit and the extent of the benefit that may be granted Section 56 of the Act provides for medical benefits to the insured workmen or in certain cases to the members of his family. It appears to us clear however that in providing for periodical payments to an insured worker in case of sickness (sickness benefit) or for medical treatment or attendance to him or the members of his family, the legislature did not intend to substitute any of these benefits for the workmens right to get leave on full pay on the ground ofis thus clear that as regards those workmen to whom the Delhi Shops and Establishments Act, 1954 applies the Tribunal has acted illegally in fixing the period of sick leave at 15 days and permitting accumulation. We therefore set aside this direction in the award and direct instead that the Company shall allow to the workmen to whom the Delhi Shops and Establishments Act, 1954 applies, sickness or casual leave of a total of 12 days with full pay and allowance and that such leave shall not be accumulated. We are also of opinion that it will not be right to have two separate leave rules for the two classes of workmen one to whom the Delhi Shops and Establishments Act 1954 applies and the other to whom it does not apply. For that is likely to be a source of much discord and heart burning. Therefore, in respect also of those workmen to whom the Delhi Shops and Establishments Act, 1954 does not apply, we think that the same period of 12 days in a year with full pay and allowances should be fixed for sickness or casual leave, and there should be no accumulation of such leave; and we direct accordingly.22. We cannot find any justification for the direction of the Tribunal that the practice of insistence on previous application for the purpose of casual leave should be relaxed in cases where it cannot possibly be so done in emergent and unforeseen circumstances and that upto 3 days no medical certificate should be asked for. The leave rules of the Company as they now stand provide that ordinarily previous permission of the head of the department and the establishment Manager shall be obtained before casual leave is taken but that when this is not possible due to sudden illness, the head of the Department or the Manager as soon as may be practiable should be informed in writing of the absence from work and of the probable duration of such absence. In our opinion, this provision is reasonable and is calculated to meet the needs of workmen for taking leave without previous permission, in case of emergency. In these circumstances the further directions as regards this that have been given by the Tribunal appear to us to be unnecessary and are hereby sethave already expressed our agreement with the Tribunals conclusion that the Companys financial resources are strong and stable and that not only has the Company been prospering in recent years but that its future prospects are also bright. Therefore, we do not think that the scheme of gratuity as framed by the Tribunal is unduly favourable to the workmen or that it places any undue strain on the Companys financial resources.24. One provision in the gratuity scheme which ought to be mentioned is that under it an employee who is dismissed for misconduct shall not be entitled to any gratuity. It has been pointed out by this Court in more than one case that having regard to the nature of gratuity it will not be proper to deprive an employee of the gratuity earned by him because of his dismissal for misconduct and the proper provision to make in this connection is that where an employee is dismissed for misconduct which has resulted in financial loss to the employer the amount lost should be deducted from the amount of gratuity due. As however in the present case, the workmen have not appealed against the award as regards the gratuity scheme framed by the Tribunal, it will not be proper for us to make the modification as indicated above.25. Coming now tothe question ofretirement age on which the workmen have appealed, we find there is some controversy as regards the existingis not clear, therefore, how onthe question ofretirement age the Tribunal proceeded on the basis that the "existing retirement" age is 55. Proceeding on this basis the Tribunal directed "that the existing retirement age at 55 years should continue but the workers may be allowed to remain in employment and work upto 60 years if found fit. The question of the further extension should rest with the discretion of the Management.Assuming therefore that for the majority of the employees there is no existing retirement age it would on the authority of the above case, be open to the Tribunal to fix the age of superannuation even with respect to them. As however the Tribunals decision that this age should be 55 is vitiated by the incorrect assumption that there is an existing retirement age of 55 it has been necessary for us to consider the question for ourselves. It appears that before the Tribunal the Unions representative himself desired that the retirement age should be fixed at 58 years which may be extended upto 60 years in fit cases. Before us the Counsel for the Company did not seriously contest that in consideration of the present day circumstances in the country it would be fair to fix the retirement age at 58. Accordingly, we set aside the Tribunals award on thisquestion of retirementage and fix the age at 58 years, subject to the proviso that it will be open to the Company to continue in its employment a workman who has passed that age. This rule should apply to all the employees of thee not impressed by thisargument. No general formula can be laid down as to the date from which a Tribunal should make its award effective. That question has to be decided by the Tribunal on a consideration of circumstances of each case. There have been cases where this Court has made an award effective from the date when the demand was first made. There are other cases where the orders of the Tribunal directing the award to be made effective from the date of the award has not been interfered with. It is true that in some cases this Court has modified the Tribunals award in such case. But it does not appear however that any general principles have been laid down. Indeed, it is difficult and not even desirable that this Court should try to lay down general principles on such matters that require careful consideration of the peculiar circumstances of each case for the exercise of discretion. It is sufficient to say that we find no reason to interfere with the Tribunals direction in this case that the reliefs given by it would become effective from the date of the reference.