New Delhi, July 15: The Supreme Court today ruled that full back wages need not be given to an employee whose dismissal from service in a company has been set aside by a court.
The ruling follows an apex court verdict delivered yesterday that daily wage earners could not be on a par with regular employees with regard to the principle of equal pay for equal work.
In today’s judgment, a division bench of Justices Doraiswamy Raju and Arijit Passayat said award of full back wages is not the “natural consequence” of an employee whose dismissal has been set aside by the court. Full back wages from the date of dismissal have till now been ordered to be given if after an employee is dismissed a court sets aside the dismissal.
The apex court said a payment as back wages that would “meet the ends of justice” was enough. This concept has been developed keeping in mind that an employee does not work during the dismissal period and also gets 50 per cent of the wages in that period.
A Madhya Pradesh State Electricity Board employee, Habib Khan, had been dismissed as a departmental inquiry had found him responsible for the theft of a large quantity of aluminium wire.
However, the labour court in Bhopal said the dismissal was “bad” in the eye of law and ordered the restoration of his services. Both the industrial court and Madhya Pradesh High Court ruled in favour of the employee. “When a charge was never established at all and the order of removal is set aside, award of back wages was the natural consequence,” said the high court.
On an appeal by the electricity board, the apex court said the high court had erred in holding that award of full back wages was the “natural consequence” and that an amount “that would meet the ends of justice” would be enough in such cases.
It said Rs 85,000 would meet the ends of justice and ordered that the payment be made within eight weeks from the date of the judgment. “If any payment has been made in excess of the amount, the (electricity) board shall be entitled to a refund thereof,” ruled the Supreme Court.
Yesterday, a division bench of Justices Raju and Passayat set aside a ruling by Punjab and Haryana High Court that had ordered daily wage earners in the state roadways department to be given pay equal to that of regular employees. The bench held that daily wage earners were entitled to “minimum wages” but not “equal pay” like regular staff, as the daily wager “could not be held to hold a post”.
“A scale of pay is attached to a definite post and in case of a daily wager, he holds no post. The respondent workers cannot be held to hold any posts to claim even any comparison with the regular and permanent staff for any or all purposes, including a claim for equal pay and allowances,” said Justice Passayat.