Madras High Court
S.Muthuvel vs The Labour Officer (Conciliation) on 3 July, 2012
Author: P.R.Shivakumar
Bench: P.R.Shivakumar
IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 03.07.2012 CORAM THE HONOURABLE MR. JUSTICE P.R.SHIVAKUMAR W.P.No.9724 of 2009 and M.P.Nos.1 and 2 of 2009 1.S.Muthuvel 2.Arikrishnan 3.M.Vellu 4.Ramachandran 5.C.Vijayarangam 6.S.Gobi 7.N.Manikandan 8.R.Balamurugan 9.J.Krishnan 10.Durairaj 11.P.Murugan 12.A.Murugan 13.R.Muthu 14.D.Venkatesan 15.T.Sivaprakasam 16.E.Meganathan 17.M.Subash 18.D.Muthuvel (All are workers working in Omkar Fine Organics Pvt. Ltd. No.23/2 Mangalam Road Uruvaiyar, Villianur Commune Pondicherry .. Petitioners Vs. 1.The Labour Officer (Conciliation) No.1, Rue Suffren Pondicherry - 605 001 2.The Secretary to the Government Labour Department Government of Pondicherry 3.Omkar Fine Organics Pvt. Ltd, Rep by its Managing Director No.23/2 Mangalam Road Uuruvaiyar Villianur Commune, Pondicherry - 605 110 .. Respondents Writ petition filed under Article 226 of the Constitution of India praying for Writ of Mandamus directing the 1st respondent conciliation officer to conclude the conciliation proceeding and file a report within a stipulated time before the government under section 12(4) of the Industrial Dispute Act and consequently direct the 2nd respondent to exercise the power under section 12(5) of the Industrial Dispute Act, 1947 to refer the dispute before the Labour court for adjudication and further direct the 3rd respondent not to remove the machineries, materials from the 3rd respondent's factory premises, without prior permission of the 1st respondent Labour Officer Conciliation while the conciliation proceeding is pending before him. For Petitioners : Mr.P.R.Thiruneelakandan For Respondent : Mr.D.Srinivasan, Govt. Pleader (Pondy) for R1&R2 Mr.L.Swaminathan for R3 O R D E R
18 workers who were employed in M/s.Omkar Fine Organics Pvt. Ltd., arrayed as the third respondent, have come forward with the present writ petition for the issuance of a writ of mandamus directing the first respondent to conclude the conciliation proceedings and file a report within a stipulated time before the government under section 12(4) of the Industrial Disputes Act, 1947 and also consequently directing the second respondent, namely the secretary to the government, Law Department, Government of Puducherry to exercise the power under section 12(5) of the Industrial Disputes Act, 1947 and refer the dispute to the Labour Court for adjudication. The petitioners have also prayed for a mandamus directing the third respondent management not to remove the machineries and materials from the third respondent's factory premises without the permission of the first respondent, namely the Conciliation Officer, before the conclusion of the conciliation proceedings and also for such further or other orders as this Hon'ble Court may deem fit in the facts and circumstances of the case.
2. The facts leading to the filing of the writ petition, in brief, are as follows:
(i) The petitioners 1 to 18 and others were employed as workers in M/s.Omkar Fine Organics Pvt. Ltd., namely the third respondent herein. They had put in more than seven years of service in the factory of the third respondent. The management of the third respondent issued a circular dated 30.04.2009 to the effect that the total value of export consignment should not be taken into account for sales incentives, since those consignments did not earn profit margin as in the local sales and that the same will contribute to the profits which will earn performance incentive at the end of the financial year. The management had expressed its view that incentive on loss sales was not intelligible. The management also informed the workers by the said circular that those workers who accept the said condition alone could continue to work. The relevant part of the contents of the circular is extracted hereunder:-
"the total value of the export consignment are not to be taken for sales incentive since these consignments do not earn the profit margin as in local sales. These will contribute to the profits which will earn the performance incentive at the end of the financial year. Incentive on loss sales is not intelligible. Those who accept the above condition can continue to work."
(iii) Sensing trouble and that, apprehending if denied payment of monthly production incentive, the workers' wages would come down to 50% and the workers would even get less than the minimum wages, the workers refused to accept the above said condition stipulated by the management of the third respondent. Pursuant to the same, only those workers who opted to accept the condition and signed the undertaking letters were allowed to work in the third respondent's factory and others were denied employment. Hence the workers, who were denied such employment, made a complaint to the Labour Officer (Conciliation), namely the first respondent, on 14.05.2009 and also to the Labour Commissioner, Puducherry on 15.05.2009 to intervene in the matter and resolve the dispute. The management also made a complaint to the first respondent (Conciliation Officer) that the workers were on illegal strike and therefore they had locked out the production unit. The Labour Officer (Conciliation), namely the first respondent, started conciliation proceedings by issuing a notice to the third respondent management and a conciliation meeting was held on 21.05.2009. As the conciliation did not result in an agreement and the third respondent walked out, the conciliation proceedings before the first respondent did not come to a logical conclusion. Under such circumstances, according to the petitioners, the management of the third respondent factory, tried to remove certain machineries and materials from the factory premises for which the workers raised objection stating that the same should not be done without getting proper permission from the labour authorities. As per the case of the petitioners, as against the workers who did not accept the condition of 50% wage cut, the management of the third respondent enforced undeclared lock-out in the production unit. While the matter was thus pending before the conciliation officer, the petitioners joined together and formed a trade union in the name and style of "Omkar Fine Organics Pvt. Ltd Thozhilalargal Sangam" and submitted an application before the concerned authority for its registration under the Trade Unions Act, 1926. Since the matter was pending before the registering authority, petitioners could not file the writ petition in the name of the trade union. Hence all the 18 petitioners have joined together and filed the present writ petition seeking the above mentioned reliefs.
3. A counter was filed on behalf of the first and second respondents, which contains the following averments:
The third respondent management on 30.04.2009 issued a circular to all its employees informing them that the total value of the export consignments would not be taken into account for incentive since it did not earn the profit margin as in local sales, but the same would contribute to the profits which would earn the performance incentive at the end of the financial year. The management also informed the workers that those who would accept the said condition could continue to work. As against the said circular, the writ petitioners raised industrial dispute by their representation dated 04.05.2009 in ID No.992/2009/LO(C)/AIL over the non-employment and loss of incentive to the employees. Based on the representation of the workers, the first respondent initiated conciliation proceedings on 06.05.2009 and issued notice to both parties. During the enquiry in the conciliation proceedings, one Thiru.Krishna Baliga, Managing Director of the third respondent management and Thiru.Panneerdasan, workers' representative took part in the conciliation proceedings. The management was advised by the first respondent to revoke the refusal of employment and to maintain industrial harmony in the factory premises and the enquiry had been adjourned to 21.05.2009. On 21.05.2009, the representative of the management boycotted the conciliation proceedings stating that the employees were represented by a third party, namely Panneerdasan. Hence the employees were advised to file a form as per the provisions of the Industrial Disputes Act, 1947 for representation and advising both parties to cooperate to maintain industrial peace, the enquiry was adjourned to 04.06.2009. On 04.06.2009, the above said management representative was present and one Muthuvel and Harikrishnan were present as representatives of the workers. After protracted discussion, the first respondent understood the implication of the disputed notice and advised the management not to victimize any worker for not agreeing for the condition and for not giving such an undertaking. The first respondent also informed the management that it was at liberty to take a disciplinary action if any misbehaviour or misconduct would be noticed by the management,. Similarly, the workers were advised not to involve in any untoward action so as to destroy the industrial peace and harmony in the work spot. Both the parties agreed for the suggestion and the workers agreed to withdraw the present writ petition which had been filed by then. Based on the agreement, the industrial dispute was closed. Subsequently, by a letter dated 07.06.2009, the management of the third respondent company forwarded a letter to the first respondent that the consensus arrived at in the conciliation had not resulted in putting an end to the differences and the workers did not report for duty on 05.06.2009 due to a scuffle between two groups of workmen. Meanwhile the employees of M/s.Omkar Fine Organics Pvt. Ltd. formed a trade union and got it registered in RTU No.1607/RTU/2009. The said union raised another industrial dispute regarding the unfair labour practice and refusal of employment to 16 workmen belonging to that union. Based on the representation, the first respondent conducted enquiry and during the enquiry on 30.10.2009 both parties informed that they were ready for bilateral discussion separately and hence the enquiry was adjourned to various dates, namely 18.11.2009, 30.11.2009, 17.12.2009, 29.12.2009 and 18.01.2010. On 19.01.2010, the conciliation authority, namely the first respondent found that there was no possibility of arriving at an amicable settlement. Subsequently, both the parties met the conciliation authority, namely the first respondent and requested not to issue a failure report as the bilateral discussion was in progress and they appeared on 17.03.2010 and requested the reopening of the conciliation proceedings for final settlement. The union insisted for compensation under voluntary retirement scheme and assured that if that was done they would not claim any employment against the management. The workers agreed to tender their resignations on getting voluntary retirement scheme compensation as agreed between the parties as per the terms of settlement dated 23.03.2010 entered into between the parties under section 12(3) of the Industrial Dispute Act, 1947. Accordingly, a copy of the settlement was also forwarded to the appropriate government on 19.04.2010. Hence there was no need to send a failure report under section 12(4) of the Industrial Dispute Act, 1947.
4. The third respondent filed a counter containing the following averments:
i) The Labour Officer (Conciliation), after holding enquiry on 04.06.2009, closed the conciliation proceedings with the observation that the workers expressed their willingness to work in the factory in a smooth manner and to maintain industrial harmony in the work spot and that the management representatives were advised not to victimize any workman but the management was free to take disciplinary action against the indisciplined workmen as per the procedure for illegal activities of the workmen in future. It was also observed by the Conciliation Officer that the request made by the management to the workmen for submitting individual undertaking regarding maintenance of industrial harmony in the work spot was agreed by the workers and they expressed their consent to withdraw the writ petition filed before the High Court and that since both the parties agreed to run the factory in a smooth manner, the industrial dispute was being closed. A copy of the said order of the conciliation officer was given to the third respondent management on 09.06.2009. That being so, the writ petition has become infructuous and despite the said fact, the writ petitioners have failed and neglected to withdraw the writ petition as agreed by them in the conciliation proceedings. Further a writ petition under Article 226 of the Constitution of India against a private industry is not maintainable. The prayer of the writ petitioners seeking a direction to Labour Officer (Conciliation) to conclude the conciliation proceedings and submit a report before the Government under Section 12(4) of the Industrial Disputes Act, 1947 for referring the dispute to the Labour Court could have been done without impleading the third respondent herein, which is a private industry. To coerce the third respondent to yield to the unwarranted demands of the writ petitioners, the third respondent has been arrayed as a party.
ii) In addition, the writ petitioners have approached this Court with unclean hands by suppression of vital information that they had proceeded on strike without notice to the management as contemplated under Section 22 of the Industrial Disputes Act. The writ petitioners herein had also prevented the ingress and egress of loyal workmen/executives/senior officials from discharging their duties. The petitioners herein had not submitted any of their grievances in writing to the management and without doing so, they directly approached the Labour Officer (Conciliation), Puducherry for the reasons best known to them. Section 23 of the Industrial Disputes Act prohibits strikes once the Labour officer (Conciliation) is seized of the matter. During the initial stage of the conciliation proceedings, the Labour Officer (Conciliation) advised the writ petitioners not to continue their strike and directed them to report for duty pending conciliation. However, the writ petitioners were adamant in continuing their agitation which resulted in the issuance of a general notice on 08.05.2009 by the management informing the writ petitioners that they would not be entitled to any wages under the concept of "No Work No Pay". Senior officials of the Police Department were also approached by the Management for providing police bandobust for transporting finished goods lying inside the factory and also to provide adequate police force in front of the factory premises to prevent any casuality. A detailed letter dated 11.05.2009 was submitted to the Labour Officer (Conciliation) highlighting the chronological factual circumstances and allegations against the writ petitioners. The writ petitioners were also sitting inside the factory premises and were creating unruly scenes, which made the management to approach the police for protection. The writ petitioners were also appraised by the third respondent that their strike under mis-guided illusion would result in failure of the conciliation and the same was also intimated to the Labour Officer (Conciliation) on 21.05.2009. The management also fairly and reasonably submitted a letter dated 01.06.2009 addressed to the Labour Officer (Conciliation) to the effect that the management would never victimize any of the writ petitioners and they would be taken into service if they give individual undertaking.
iii) On 09.06.2009, the writ petitioners individually submitted their apology to the management and agreed to withdraw the writ petition and also agreed to have discussions with the management and if necessary, to approach the Labour Officer (Conciliation). Contrary to their undertaking, they failed to withdraw the writ petition and hence, the writ petition should be dismissed with cost.
5. The arguments advanced by Mr.P.R.Thiruneelakandan learned counsel for the petitioners, by Mr.D.Srinivasan, Govt. Pleader (Pondy) for Respondents 1 and 2 and by Mr.L.Swaminathan, learned counsel for the third respondent were heard. The materials available on record were also perused.
6. The writ petitioners, totally 18 in number, are the workers of M/s.Omkar Fine Organics Private Limited, Puducherry, the third respondent Management. Since certain dispute arose between the workers and the management, conciliation proceedings came to be initiated before the Labour Officer (conciliation), Puducherry, the first respondent herein. Noting that the management and the workers agreed for certain terms and both of them were advised to create a congenial atmosphere for the smooth running of the factory, the first respondent, namely the Labour Officer (Conciliation), Puducherry simply closed the conciliation proceedings under an order dated 04.06.2009. Since the Conciliation Officer could not bring about a settlement and also failed to submit a report to the Government under Section 12(4) of the Industrial Disputes Act 1974, the writ petitioners chose to approach this Court by way of the present writ petition invoking the extraordinary jurisdiction of this Court under article 226 of the Constitution of India for the issue of Writ of Mandamus directing the first respondent/Conciliation Officer to conclude the conciliation proceedings and file a report within a stipulated time before the Government under Section 12(4) of the Industrial Disputes Act, 1947 and directing the Secretary to the Government, Labour Department, Government of Puducherry, the second respondent herein, to exercise the power under Section 12(5) of the Industrial Disputes Act to refer the dispute to the Labour Court for adjudication and for a further direction to the management, namely the third respondent, not to remove the machineries and materials from the third respondent's factory premises without prior permission of the Labour Officer (Conciliation), the first respondent herein during the pendency of the conciliation proceedings and pass such other order or further direction as the Court may deem fit.
7. The learned counsel for the petitioners would submit that a conciliation proceedings initiated before the Conciliation Officer shall be brought to an end either by a settlement in terms of section 12(3) of the Industrial Disputes Act or by the submission of a report to the Government to the effect that the conciliation failed, based on which the dispute may be referred by the Government to the Labour Court. According to the submission made by the learned counsel for the petitioners, the first respondent/Labour Officer (Conciliation), without adopting either of the procedures, chose to simply close the proceedings without either submitting the settlement in terms of Section 12(3) or a failure report to the Government under Section 12(4) of the Industrial Disputes Act and hence, it has become necessary for the Court to issue a Writ of Mandamus directing the first respondent to file a report and the second respondent to refer the dispute to the Labour Court for adjudication.
8. Though the learned Government Pleader (Puducherry) intially took a stand that since the parties themselves had agreed for certain terms, there was no need for the Labour Officer (conciliation) to submit a report under Section 12(4) of the Industrial Disputes Act to the Government and that therefore, the prayer in the writ petition could not be granted, subsequently when appraised of the scope of the proceedings before the Conciliation Officer and the manner in which the conciliation proceedings could be brought to an end, the learned Government Pleader would submit that the Conciliation Officer did not follow either of the procedures and chose to simply close the conciliation proceedings tendering advise to the parties to the proceedings regarding the manner in which they had to act to maintain industrial peace. Having admitted the fact that the first respondent has not acted in accordance with the provisions of law regarding termination of the conciliation proceedings, the learned Government Pleader made an attempt to contend that since the writ petitioners are said to have agreed to withdraw the writ petition, nothing survives in the writ petition to be adjudicated upon and this Court should dismiss the writ petition on that score alone.
9. Exactly the same happened to be the contention raised on behalf of the third respondent management. Besides such a contention, the third respondent management also took a stand that the writ petition could not be maintained against the third respondent, a private industry and that therefore, the writ petition should be dismissed. However, the question to be answered in this writ petition is, whether there was any settlement during the pendency of this writ petition under which the writ petitioners agreed to withdraw the writ petition.
10. Now this Court has to consider the sustainability of the above said objections raised on behalf of the respondents.
11. Regarding payment of incentives to the workers, the third respondent management chose to issue a circular on 30.04.2009 to all the employees to the following effect:
"The total value of the export consignments are not to be taken for sales incentive since these consignments do not earn the profit margin as in local sales. These will contribute to the profits which will earn the performance incentive at the end of the financial year.
Incentive on loss sales is not intelligible.
Those who accept the above condition can continue to work"
The third respondent also wanted the workers to give an undertaking containing 14 clauses. Since the workers did not agree for the same, they were allegedly denied employment. On the other hand, the management contended that the workers proceeded on an illegal strike.
12. All the 18 petitioners, workers of the third respondent industry, raised an industrial dispute before the first respondent complaining non-employment by a letter dated 04.05.2009. Meanwhile, the third respondent management also enforced a lockout, pursuant to which another letter dated 15.05.2009 came to be issued by the workers to the first respondent and to the Joint Director, Labour Department, Puducherry. Based on the same, the first respondent/Labour Officer (Conciliation), issued a notice dated 05.05.2009 for enquiry/conciliation to the parties. As an objection was raised on behalf of the management that the workers were not represented properly by authorized representatives, the writ petitioners/workers, later on formed a trade union and got it registered as Omcar Fine Organics Workers Union. Thereafter, during the conciliation proceedings, the management offered sum package for voluntary retirement for the workers, who were not inclined to accept the conditions put forth by the management by the general circular dated 30.04.2009 regarding incentive. It is the contention of the third respondent that except the writ petitioners, who are 18 in number, all other workers agreed for the terms and they got the package allowed by the management. It is contended on behalf of third respondent that the petitioners also agreed to maintain industrial harmony in the work spot and to withdraw the present writ petition pending before this Court and that after giving such a consent, the petitioners have gone back from their commitment and failed to withdraw the writ petition.
13. On the other hand, it is contended by the petitioners that the observation made by the first respondent / Labour Officer (Conciliation) on 04.06.2009 closing the conciliation proceedings will not amount to a settlement enforceable under the provisions of the Industrial Disputes Act and that therefore, the respondents cannot plead such an arrangement or settlement as a defence in the writ petition. It is also contended on behalf of the petitioners that the management, after giving an undertaking before the Labour Officer (Conciliation) not to victimize the workmen, later on refused to allow them to enter the factory to do work unless and until they would give an undertaking accepting the conditions as proposed by the management and that since the management had not kept its words, the petitioners had to keep the writ petition alive and pray for the relief sought for in the writ petition. It is their further contention that the order of the conciliation officer is not the one contemplated under the provisions of the Industrial Disputes Act and it can never amount to a settlement which is enforceable. It is pointed out that a settlement can be voluntary or at the intervention of the conciliation officer, in which case, the settlement has to be filed with the Government, published in the gazette. It is the contention of the petitioners that the order of the first respondent dated 04.06.2009 cannot be construed to be a settlement. The order as passed by the first respondent as per the averments found in the counter affidavit of the third respondent reads thus:
"The Labour Officer (Conciliation) after holding Enquiry Proceedings on 04.06.2009 had closed the Conciliation Proceedings with the following observation:
".........Workers expressed their willingness to work in the factory in a smooth manner and will maintain industrial harmony in the working spot. Labour Officer (Conciliation) advised the Management representatives not to victimize any Workmen for the reason whatsoever. Further advised that the Management is free to take Disciplinary Action against the in disciplined Workmen as per the procedure in future for illegal activities by the workmen.
Management requested individual undertaking from each workmen regarding maintenance of Industrial harmony in the Working spot. Workers also agreed to do with the same. Workers side expressed their consent to withdraw the Writ Petition filed before the High Court, Chennai.
Both Parties agreed to run the factory in Smooth manner.
Accordingly this Industrial Dispute was closed......"
14. Upon perusing the same, this Court is of the view that the same is not in tune with the manner in which the conciliation proceedings can be terminated. A conciliation proceedings has to be terminated either by arriving at a settlement and filing the report signed by the parties before the Government or by submitting a failure report to the Government so as to enable the Government to refer the dispute to the Labour Court for adjudication. In this case, there is no settlement signed by the parties as per Section 12(3) of the Industrial Disputes Act. Under such circumstances, the way in which, the first respondent/Labour Officer Conciliation has closed the conciliation proceedings, is not the manner known to law. Hence, this Court has to accept the contention of the learned counsel for the writ petitioners that though the other workers might have agreed for an out of Court settlement with the management, such a settlement cannot be thrust upon the petitioners against their consent; and that there is no settlement between the management and the writ petitioners which can be enforced in law and that under such circumstances, the conciliation officer ought not to have chosen to close the conciliation proceedings without aiming at arriving at a settlement or in case of failure of settlement by submitting a failure report to the Government. In view of the same, this Court is convinced with the tenability of the prayer made by the petitioners. Accordingly, there shall be a direction to the first respondent to conclude the conciliation proceedings within a time to be fixed by this Court and submit a report to the Government under Section 12 (4) of the Industrial Disputes Act, a further direction to the second respondent to exercise the power under Section 12(5) of the Industrial Disputes Act, 1947 and refer the dispute before the Labour Court for adjudication on receipt of such a report from the first respondent and also a direction to the third respondent not to remove the machineries and materials from the third respondent's factory premises without prior permission of the 1st respondent Labour Officer (Conciliation), during the pendency of the conciliation proceeding before him.
15. In the result, the writ petition is allowed and the first respondent is directed to conclude the conciliation proceedings and file a report within two months from the date of receipt of a copy of this order and the second respondent shall refer the dispute to the Labour Court for adjudication exercising its power under Section 12(5) of the Industrial Disputes Act. Further, the third respondent is directed not to remove the machineries except the finished materials from the factory without the prior permission of the first respondent, Conciliation Officer during the pendency of the conciliation proceedings. No costs. Consequently, the connected miscellaneous petitions are closed.
gpa To
1.The Labour Officer (Conciliation) No.1, Rue Suffren Pondicherry - 605 001
2.The Secretary to the Government Labour Department Government of Pondicherry
3.Omkar Fine Organics Pvt. Ltd, Rep by its Managing Director No.23/2 Mangalam Road Uuruvaiyar Villianur Commune, Pondicherry 605 110