Case: Bharatiya Kamgar Sena Vs. Otis Elevator Employees Union &amp; Others

1. The petitioner and the first respondent are registered under the Trade Union Act, 1926. Respondent No.2 is the Otis Elevator Company (India) Limited, Western Region, which is one of the undertakings of M/s. Otis Elevator Company (India) Limited.2. The petitioner has challenged an order of the Industrial Court declaring the firstas the recognized union under section 11 of the Maharashtra Recognition of Trade UnionPrevention of Unfair Labour Practices Act, 1971 (hereinafter referred to as "the Act") in respect of the second respondents undertaking known as M/s. Otis Elevator Company (India) Limited (Western Region).3(A). By an application dated 29th January, 2005, the first respondent sought to be declared as the recognized union under section 11 of the said Act. The application stated as follows.Over 50% of the employees in the said undertaking were members of the first respondent for the whole of the period of six calendar months immediately preceding the month in which the application was made i.e. from July, 2004 to December, 2004. This fulfills the requirement of section 11(1) which entitles a union to apply for being registered as a recognized union of an undertaking only if it has a membership of not less than 30 per cent of the total number of employees employed in the undertaking.The list of 272 employees of the undertaking who were the members of the first respondent was furnished. This fulfills the requirement of section 10 which makes Chapter III applicable to undertakings wherein 50 or more employees are employed at the relevant time.The membership of respondent No.1 is more than the membership of the petitioner entitling respondent No.1 to be preferred for recognition in view of section 12(3).The said undertaking had full and complete control over the said members / employees inasmuch as their activities, work, wages, allowances, bonus,leave, work norms and all other service conditions were directed and controlled by and from the said undertaking. The recognition was sought only in respect of the said undertaking located at Malad in Mumbai. It is not necessary to refer to the other averments, including regarding the constitution of the firstas the same were not in dispute.(B). The petitioner filed a written statement / objections to the first respondents application for recognition under the Act.

Court's reasoning:
The finding of the Industrial Court that the field workers were attached to and were under the supervision and control of the Western Region must be sustained. The findings do not warrant any interference. The Industrial Court has answered this issue in the affirmative after considering the evidence and the material on record. We see no reason to take a different view.9. The first respondent claimed that 272 workers of the Western Region Office were its members at the relevant time. A report was also prepared by the Investigating Officer of the Industrial Court. Assuming that the field workers are to be considered, four issues of fact are established viz. (i) There were more than 50 employees employed in the undertaking. (ii) The first respondents membership exceeded 30% of the employees in the undertaking. In fact, it was over 50%. (iii) The first respondents membership is larger than the membership of the petitioners. (iv) The 272 workers listed in the application for recognition were the first respondents members is not disputed. If however, the field workers are not to be considered, the first respondents application would not be maintainable as in view of section 10, Chapter III would not be applicable as there were less than 50 employees employed in the undertaking. Admittedly without the field workers, there were less than 50 employees employed in the undertaking.Considering the nature of the activities, especially of the field workers, it is obvious that they do not attend the Western Region office daily. The nature of their work requires their presence at the relevant site where the companys activities are actually being carried out. They are spread over the city at the various sites. It has come on record that the company also has four depots located at Colaba, Breach Candy, Andheri and Kandivali. They are looked after by Assistant Managers. About 5 to 6 persons worked under each of these Managers who are posted at particular depots. The field workers reported to these persons and also collected material from them as well as from the other stores. The workers are also controlled by the Model Standing Orders as well as the Industrial Employment Of Standing Orders Act. The Model Standing Orders are applicable to establishments where 50 or more workers are working. The Industrial Court, therefore, justifiably considered this to be a factor in favour of the first respondents contention that the said undertaking had 50 or more workers. This was, however, not the only basis on which the Industrial Court came to the conclusion that the said undertaking had 50 or more workers. The conclusion was also arrived at for various other reasons which are as follows.12. The evidence of the witnesses, including the companys officers, establish certain crucial factors which establish that the field workers concerned were supervised, controlled by and were otherwise attached to the undertaking. The said field workers were appointed by the Western Region Office. Their pay slips were issued from the Western Region Office. Disciplinary action was also taken against these workers by the Western Region Office. The Western Region Office was responsible for preparing the details relating to the salaries of the said field workers. Instructions for the change in location of the field workers were given by the Western Region Office. Thus, the Western Region Office looked after, controlled and directed the appointment, transfers, payment of wages, disciplinary action and the leave record in respect of these field workers.The depots were not separate undertakings. As the sites were at various locations at a considerable distance from each other and from the Western Region Office, it is understandable that the workers assembled at the depots and collected the material from the depots and other stores. It is also understandable in these circumstances that they did not report to the Western Region Office daily. In these circumstances, it would make no difference even if the wages were handed over to them at convenient locations other than at the Western Region Office itself.13. Theof one of the petitioners witnesses is important and instructive. The petitioners witness admitted inion used to correspond with the company at the Western Region Office. He further admitted that all the activities of the company were carried out at the Western Region Office. Even the charter of demands and grievances of the employees were addressed to and dealt with at the Western Region Office. Theitself signed agreements at the address of the Western Region Office. He also admitted that the computation of wages, deduction from the salary and the maintenance of records with regard to the salary was maintained at the Western Region Office. Leave applications of the employees used to be sent to the Western Region Office. The leave records were maintained at the Western Region Office. He further admitted that disciplinary action was taken at and controlled from the Western Region Office. Show cause notices were issued from there. Letters of promotions and transfers were also issued from the Western Region Office. The time ticket record used to be maintained at the Western Region Office. It is on the basis thereof that the salary used to be computed.Mr. Bapat submitted that a large part of the impugned order is nothing, but a reproduction of the earlier order which had been set aside by the Division Bench with a direction to pass a fresh order. He submitted that the impugned order was passed without adverting to the relevant evidence. He, therefore, submitted that we ought to set aside the order and remand the matter once again to the Industrial Court.Even assuming that the submission is well founded, we see no purpose in remanding the matter. It has already been remanded once. Remanding it again would cause unnecessary inconvenience and expense to both the parties. We, therefore, allowed Mr. Bapat to address us on the facts as well.15. The Industrial Court was therefore, justified in concluding that the said field workers were under the supervision and control of the Western Region Office. The Industrial Court cannot be faulted for having rejected the petitioners contention that these workers were not attached to the depots as contended by the petitioner. We are, therefore, entirely in agreement with the Industrial Court that the said field workers were attached to, controlled and supervised entirely by the Western Region Office i.e. the undertaking in respect whereof the recognition has been granted to the first respondent.We are unable to agree with Mr. Bapats contention that field workers cannot be said to be employed in the undertaking or in the precincts thereof. As the short title itself suggests, the Act is, interalia, for the recognition of trade unions. The preamble opens by saying that it is an Act to provide for recognition of trade unions. It also states the purpose for which the recognition is granted to the trade union. It is to facilitate collective bargaining for certain undertakings, to state their rights and obligations, to confer certain powers on unrecognized unions, to define and provide for the prevention of certain unfair labour practices, to prohibit and declare certain rights and lockouts as illegal strikes and lockouts and to constitute courts for carrying out the purposes of according recognition to trade unions and for enforcing the provisions relating to unfair practices and to provide for matters connected therewith. It is necessary to emphasize the fact that the main purpose of the Act is the recognition of Trade Unions and to regulate the rights and obligations of a recognized union and its members.As rightly submitted by Mr. Singhvi, the learned counsel appearing on behalf of the respondent No.1, the Act does not in so many words exclude from its ambit, employees such as field workers who are not present and do not work physically in the premises of the undertaking concerned or within the precincts thereof. Mr. Bapat has not invited our attention to any such provision either. He, however, submits that this is the effect of the words "employees employed in any undertaking". There is no reason why the legislature would have intended excluding from the ambit of the MRTUPULP Act, field workers. There is no reason why field workers would be excluded from the benefit of the Act. Section 3(5) of the MRTUPULP Act, which defines the term "employee" does not exclude from its purview, field workers. The plain language does not exclude them. There is nothing in the section that persuades us to take the view that field workers are impliedly excluded therefrom.As also rightly submitted by Mr. Singhvi, the preposition "in" is elastic and can mean both inside a place or in regard thereto or with respect thereto. Considering the provisions of the Act and the Legislative intent behind it, we are of the view that the preposition "in" in section 11 and in particular in the words "employees employed in any undertaking" refers to employees actually physically present and working in the premises of the undertaking as well as employees working outside the premises but whose work relates to, is connected with and is in relation to the work of the undertaking and such employees are connected to the undertaking. Considering the purpose of the Act which is,to provide for the recognition of a trade union for facilitating collective bargaining for certain undertakings and to regulate the rights and obligations of the unions, the members of the union and the employer, the broader view proposed by Mr. Singhvi commends itself to us. The Act is a welfare legislation. The purpose of the Act would be better served by including, rather than excluding, the employees from the purview thereof.The advantages of including them are obvious. The provisions of the Act have not been challenged. The legislature obviously thought it in the interest of the employers and the employees to have only one recognized union for the purpose of the Act. If we were to accept Mr. Bapats submission, the purpose of the legislation would be defeated. It would lead to several unions operating in respect of the same undertaking. Mr. Bapat has not indicated any advantage with the existence of several unions. We see no advantage in excluding from the purview of the Act, field workers. No reason has been indicated by Mr. Bapat. He merely stated that the Act does not include within its ambit, such employees. There is no reason then why field workers ought to be denied the benefit of the Act. There is no reason why they ought to be denied benefits as members of the recognized union, including their ability for collective bargaining. Indeed their bargaining power would be enhanced if they were part of the recognized union. It is reasonable to presume that the recognized union would be in a better position while bargaining on behalf of the employees. This is for the obvious reason that under section 12(3), it is the union with the largest number of members that is entitled to recognition provided it fulfills all the other requirements of the Act.24. Section 3(15), which defines the term "undertaking", really provides that any concern in industry shall be one undertaking for the purpose of Chapter III and entitles the Government to notify a group of concerns owned by the same employer in any industry to be one undertaking for the purpose of that chapter. We do not see how section 3(15) even impliedly excludes field workers from the ambit of Chapter III.25. Mr. Bapats interpretation of the provisions of the Act, if accepted, would cause difficulties and uncertainties in determining the employees who could be said to be employed or working in the undertaking. There are some employees, such as field workers, who would seldom have to visit the premises of the undertaking itself. There are some employees who would have to visit the undertaking more often, but not at all times. They may not even have to visit the undertaking for a substantial part of their working hours and days. For instance, drivers and attendants of buses meant to transport the employees from the undertaking to their respective destinations outside the premises would spend a part of the day outside the premises and a part of the day within the premises. Similarly, drivers of cars of the employees of the undertaking would also spend varying amounts of time within the premises and outside the premises. Sales executives would also spend a part of their working hours within the premises and a part outside the premises. The number of hours spent by such employees within the premises would also vary. The amount of time spent in the premises would vary on account of innumerable factors. All these employees may well travel even outside the city regularly. Where does one draw the line  The Act does not provide any guidelines to determine the same. The legislature, as we noted earlier, was obviously of the view that it is desirable to facilitate and encourage not merely the formation of unions, but the recognition of only one union in respect of an undertaking. The validity of this view is not under challenge. That being so, the interpretation of Mr. Bapat would run contrary to the purpose of the legislation.Mr. Singhvis reliance upon the judgment of the Supreme Court in J.K. Cotton SpinningWeaving Mills Co. v. Labour Appellate Tribunal of IndiaOrs. AIR 1964 SC 787   = 1963 II LLJ, 436, is well founded.While we are dealing with this point it is necessary to bear in mind that the bungalows are owned by the appellant and they are allotted to the officers as required by the terms and conditions of the officers employment. Since the bungalows are allotted to the officers, it is the duty of the appellant to look after the bungalows and take care of the gardens attached to them. If the terms and conditions of service require that the officers should be given bungalows, it is difficult to see why in the case of Malis who are employed by the appellant, are paid by it, and who work subject to its control and supervision and discharge the function of looking after the appellants property, it should be said that the work done by them has no relation with the industry carried on by the appellant. The employment is by the appellant, the conditions of service are determined by the appellant, the payment is substantially made by the appellant, the continuance of service depends upon the pleasure of the appellant, subject, of course, to the Standing Orders prescribed in that behalf, and the work assigned to the Malis is the work of looking after the properties which have been allotted to the officers of the appellant. Like the transport amenity provided by a factory to its employees, bungalows and gardens are also a kind of amenity supplied by the employer to his officers and the drivers who look after the buses and the Malis who look after the gardens must, therefore, be held to be engaged in operations which are incidentally connected with the main industry carried on by the employer. It is true that in matters of this kind it is not easy to draw a line, and it may also be conceded that in dealing with the question of incidental relationship with the main industrial operation, a limit has to be prescribed so as to exclude operations or activities whose relation with the main industrial activity may be remote, indirect and farfetched. We are not prepared to hold that the relation of the work carried on by the Malis in the present case can be characterised as remote, indirect orThat is why we think that the Labour Appellate Tribunal was right in coming to the conclusion that Malis are workmen under the Act.Bapat fairly conceded that the judgment does not cover the case before us. He, however, submitted that the observations therein would apply with equal force to the provisions of the MRTUPULP Act.The definition of a worker in the Factories Act, 1948, is different from the definition of an employee which falls for consideration before us. Section 2(l) of the Factories Act defines the nature of work and section 2(m) defines a factory. The Supreme Court expressly held that it is "the combined operation of these definitions" that must be considered. It is upon a combined operation of these definitions that the Supreme Court came to the conclusion that the provisions of the Factories Act are intended to benefit only workers employed in a factory i.e. on the precincts or premises of a factory. It is also not possible to apply the definition under the Factories Act to the MRTUPULP Act for, as noted by the Supreme Court itself, the diverse provisions of the Factories Act are intended only to benefit workers employed in the factory i.e. precincts or premises of a factory.The provisions of the MRTUPULP Act, however, do not indicate that they apply only to persons working inside or within the undertaking. The definition of undertaking in section 3(15) of the MRTUPULP Act is entirely different from the definition of a factory in section 2(m) of the Factories Act.28. Mr. Bapat then contended that section 12 and regulation 85 establish that field workers cannot be said to be employed in any undertaking. Section 12 provides that a notice of an application from a union for recognition under section 11 is to be displayed on the notice board of the undertaking. The employees concerned are also entitled to show cause as to why the recognition should not be granted to theRegulation 85 also requires the employer whosehas applied for recognition to display on the notice board at a conspicuous place of the premises of the undertaking, such an notice. He submitted that it would be impossible for the field workers to see the notice if they do not attend the premises of the undertaking itself. This he submitted supports his contention.29. Firstly, it is not necessary that a field worker would not ever attend the undertaking. Secondly, it is always possible for a field worker to come to know of the same through others. Thirdly, in any event, this would at the highest be a situation which is for the legislature to take care of. The provisions do not militate against our interpretation of the provisions of the Act.30. The Western Region office dealt with the entire Western region, which included the whole of Maharashtra and parts of Gujarat and Madhya Pradesh. There was no separate office for the Mumbai region. However, an overwhelming majority workers are at sites in Mumbai. The impugned order grants recognition only in respect of the field workers in Mumbai city. The first respondent has not challenged this part of the order.31. Mr. Bapat however, submitted that the first respondent made the application for recognition in respect of the entire Western Region Office. The Western Region Office comprises of employees, not merely in Maharashtra, but in parts of Gujarat and Madhya Pradesh as well. The Industrial Court has granted recognition only insofar as it concerns the employees in the city of Mumbai. According to him, the application having been for the entire undertaking, it was not open to the Industrial Court to sanction only a part thereof.32. The firsthas not challenged this restriction. Mr. Bapat, in fact, rightly agreed that if it is held that field workers are covered by the provisions of Chapter III, then even field workers connected to the said undertaking, though deployed in other States, ought also to be considered, as the recognition is qua the undertaking.The error if any in the order then prejudices not the petitioner, but the first respondent. In any event, an overwhelming majority of the first respondents members are from Mumbai itself. The first respondent cannot then be prejudiced further.33. The inclusion of the sales promotion employees in the definition of employee in section 3(5) is of no assistance to the petitioner. Nor is the use of the term "means" in section 3(5) of any assistance to the petitioner. Section 5(e) provides that employee means an employee as also defined in section 3(13) of the Bombay Industrial Relations Act and section 2(s) of the Industrial Disputes Act. The Act does not contain any bar against field workers being members of a union which is entitled to seek recognition under section 11. Section 2(s) of the Industrial Disputes Act, we have already seen, includes employees working outside the premises.34. In that view of the matter, field workers ought not to be excluded from the ambit of Chapter III of the Act.