Allowed

M/S Biesse Manufacturing Company Ltd., v. Sri Omkaramurthy T.G.

Karnataka HC8 Feb 2024WP/42746/2018

Case brief

AI extract

What is this about?

The High Court of Karnataka quashed a Labour Court award reinstating a terminated ITI Technician Trainee. The Court held the respondent was not a 'workman' under the ID Act, received a stipend rather than wages, and his termination upon contract expiry was valid.

What did the court decide?

The writ petition was allowed and the impugned order of the Labour Court dated 24.07.2018 directing reinstatement was set aside.

M/S Biesse Manufacturing Company Ltd., Vs Sri… — Service and Employment | Karnataka HC (2024)

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NC: 2024:KHC:5581 WP No. 42746 of 2018

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU

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DATED THIS THE 8^TH DAY OF FEBRUARY, 2024

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BEFORE

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THE HON'BLE MRS JUSTICE K.S. HEMALEKHA

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WRIT PETITION NO.42746 OF 2018 (L-RES)

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BETWEEN:

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M/S. BIESSE MANUFACTURING COMPANY LTD., SURVEY NO.32, NO.649, JAKKASANDRA GRAMA, NELAMANGALA, BENGALURU RURAL – 562 123. GENERAL MANAGER–HR. ... PETITIONER (BY SRI C.K. SUBRAHMANYA, ADVOCATE FOR SRI B.C. PRABHAKAR, ADVOCATE)

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AND:

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Digitally signed by MAHALAKSHMI B M Location: HIGH COURT OF KARNATAKA

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SRI OMKARAMURTHY T.G. S/O. GANGADHARAIAH, NO.156/1, SUNANDAMMA BUILDING, 5^TH CROSS, VIDYANAGAR, T. DASARAHALLI, BENGALURU – 560 057. ... RESPONDENT

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(BY SRI H.V. BHANUPRAKASH, ADVOCATE)

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THIS WRIT PETITION IS FILED UNDER ARTICLE 226 OF THE CONSTITUTION OF INDIA, PRAYING TO CALL FOR RECORDS LEADING TO THE PASSING OF THE AWARD DATED 24.07.2018, PASSED BY FIRST ADDITIONAL LABOUR COURT BANGALORE, IN REF.NO.15/2014 VIDE ANNEXURE-P; QUASH THE AWARD DATED 24.07.2018, PASSED BY THE FIRST ADDITIONAL LABOUR COURT, BANGALORE, IN REF NO.15/2014 VIDE ANNEXURE-P.

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THIS WRIT PETITION COMING ON FOR DICTATING ORDERS, THIS DAY, THE COURT MADE THE FOLLOWING:

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ORDER

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Respondent was appointed as ITI Technician Trainee

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for a fixed term of one year from 13.09.2010 on the terms and conditions that “your engagement will be for a fixed term period of 12 months from the date of your reporting for duty. During the period of your engagement, your service are liable to be terminated by giving 15 days’ notice on either side or 15 days salary in lieu of notice. However, if you are found guilty of misconduct, you are liable to be dismissed without notice or payment in lieu of notice”. Respondent accepted the appointment on terms and conditions stipulated in the appointment order, the training of the respondent was extended from time to time, since his performance was not satisfactory, the period of training was not renewed beyond 24.09.2013.

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Respondent raised dispute which came to be referred for adjudication by the Labour Court on the following points of dispute:

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“1. Whether the management of M/s BIESSE Manufacturing Company Limited, Bangalore is justified in terminating the services of Sri Omkaramurthy, son of Gangadharaiah with effect from 25.09.2013?

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2. If not what relief the workman is entitled to?”

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Respondent filed claim statement seeking to set

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aside the order of termination and grant him the relief of reinstatement along with all benefits. The petitionermanagement filed objections/counter statement resisting the claim of the respondent, the Labour Court by the impugned order set aside the order of termination and directed the management to reinstate the respondent with continuity of service and all other consequential benefits for the purpose of terminal benefits, however, the Labour Court held that the respondent is not entitled for backwages.

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Heard Sri C.K. Subrahmanya, learned counsel

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for Sri B.C. Prabhakar, learned counsel for the petitioner

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and Sri H.V. Bhanuprakash, learned counsel for the respondent-workman. .

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Learned counsel for the petitioner would contend that the respondent was appointed as a ITI Technician trainee and it is crystal clear that the respondent has consciously accepted the post of trainee for the fixed period and the respondent was fully aware of the consequences after the fixed period of training is over. Learned counsel for the petitioner would contend that the termination of a trainee on the expiry of the prescribed period will not amount to termination since such termination is excluded under Clause (bb) of Section 2(oo) of the Industrial Disputes Act, 1947 (‘the ID Act’ for short) and hence, the Labour Court could not have granted relief when the trainee challenges his termination. Learned counsel would contend that the Labour Court lacks the jurisdiction to entertain the claim statement as the respondent does not fall under the definition of the ‘workman’ as envisaged under Section 2(s) of the ID Act.

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Per contra, learned counsel for the respondent

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would justify the order of the Labour Court and would contend that the respondent has rendered services as an ITI Technician and was performing the clerical functions and as such, he was covered under Section 2(s) of the ID Act. Learned counsel, while justifying the order of the Labour Court, would contend that the Labour Court has rightly held that the respondent is a workman and that the respondent has worked for 240 days and the termination of his service is contrary to the provisions of Section 25F of the ID Act, the Labour Court has rightly directed reinstatement of the workman and the same does not warrant any interference.

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This Court has carefully considered the rival contentions urged by the learned counsel for the parties and perused the material on record.

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The question that falls for consideration before this Court is:

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“Whether an “ITI Technician Trainee” would be covered under the definition of ‘workman’ under Section 2(s) of the ID Act and whether the services of the said trainee could not be terminated without compliance of Section 25F of the ID Act and whether the termination of the trainee after the expiry of the prescribed period will not amount to termination and would exclude under Clause (bb) of Section 2(oo) of the ID Act?”

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9. The standing orders of the petitioner-company

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was certified by the Certifying Officer under the Industrial Employment (Standing Orders) Act, 1946 on 15.04.2011 and while certifying the standing orders, the fixed term category employees was deleted. In addition to engaging regular employees in various categories the petitioner’s management is also having the training scheme called “Trainees Deployment and Development Procedure”. The objective of the Trainee Development Procedure is to ensure effective development of trainees of the petitionercompany and development of skill sets out to obtain suitable jobs within and outside the company. The

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following types of trainees has to be engaged as per the procedure adopted by the company:

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a) ITI Trainees;

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b) Diploma Trainees;

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c) Technical Graduation Trainees;

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d) Graduate Trainees

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The minimum training period is 12 months and

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maximum period is 36 months. It is submitted that ITI candidates were deputed to training in machine shop, assembly and warehouse. As per Clause 13 of the Engagement Order, the engagement will automatically come to an end at the termination of contractual period of fixed term and Clause 14 of the order stipulates that in case, the terms and conditions of the trainee engagement are acceptable to the respondent, the respondent has to return the copy of the engagement letter after affixing the signature. The respondent has accepted all the terms and conditions of the engagement letter and gave a clear declaration and acceptance. Thereafter, respondent was

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issued with the ITI Technician Trainee appointment by issuing the Engagement Letter dated 09.09.2010 for the period of 12 months.

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The respondent was unable to learn or effectively perform in the subsequent training modules in spite of extension given to him until September 2013 and since the performance of the trainee between March 2013 and September, 2013 was not satisfactory and he has failed to complete the training module even after the extended period, the management took a decision to put an end to his training in September, 2013 and his training was not extended beyond September, 2013.

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The dispute that was referred for adjudication was whether the termination of service of the petitioner was justified. Learned counsel appearing for the petitioner would urge that the respondent does not come under the definition of the ‘workman’ under Section 2 (s) of the ID Act as the respondent being a trainee. Learned counsel appearing for the respondent would contend that the

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respondent has worked for more than 240 days and as such, the termination of his service is contrary to the provisions of Section 25F of the ID Act, the order of employment clearly sets out the terms therein, which make it clear that the facility of providing training to the respondent would come to an end at the expiry of 12 months from the date of reporting for duty and it also further mentions that if the respondent is found guilty of the misconduct, he is liable to be dismissed without notice or payment in lieu of notice. The standing order of the company states at clause No.3.3, which reads as under:

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“3.3 TRAINEE: A trainee is one to whom training is imparted (not under the Apprentices Act 1961). The trainee shall have no claim for employment after completion of the period of training. The Management shall decide the period of training. The period of training shall not exceed maximum Two years in all and the trainee is bound by the rules framed by the Management for that purpose notwithstanding anything contrary contained in these standing orders. A trainee shall not be a workman merely because ‘Trainee’ is defined under

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classification of workmen. It is not obligatory by the Company to employ a trainee on completion of his period of training. The Management at its sole discretion can appoint suitable trainee as a probationer on completion of his training period. A stipend will be paid during the training period.”

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The said clause refers to the fact that the period of training shall not exceed the maximum period of two years in all and the trainee is bound by the rules framed by the company for that purpose, notwithstanding anything contrary contained in the standing orders. A trainee shall have no claim for employment after completion of period of training. It is clear that the petitioner was not satisfied with the work of the respondent and as such, notice intimating the completion of training period was issued which clearly states that the management has reviewed his performance during the work period and found that his performance is not satisfactory and refused to extend further period of training and the training period stands ceased from 13.09.2013.

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Thus, the respondent’s service was terminated and has not extended further. In such a case, question of issuance of notice before terminating the service as claimed by the respondent does not arise and the respondent cannot claim that the termination of his service is contrary to the provisions of Section 25F of the ID Act.

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Insofar as the arguments advanced by the petitioner to the effect that the respondent does not come under the definition of ‘workman’ as defined under Section 2(s) of the ID Act, it is relevant to observe the definition of Section 2(s) as below:

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“ 2. Definitions.— In this Act, unless there is anything repugnant in the subject or context,—

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(s) “workman” means any person (including an apprentice) employed in any industry to do any manual, unskilled, skilled, technical, operational, clerical or supervisory work for hire or reward, whether the terms of employment be express or implied, and for the purposes of any proceeding under this Act in relation to an industrial dispute, includes any such person who has been dismissed, discharged or retrenched in connection with, or as

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a consequence of, that dispute, or whose dismissal, discharge or retrenchment has led to that dispute, but does not include any such person—

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(i) who is subject to the Air Force Act, 1950 (45 of 1950), or the Army Act, 1950 (46 of 1950), or the Navy Act, 1957 (62 of 1957); or

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(ii) who is employed in the police service or as an officer or other employee of a prison; or

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(iii) who is employed mainly in a managerial or administrative capacity; or

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(iv) who, being employed in a supervisory capacity, draws wages exceeding ten thousand rupees per mensem or exercises, either by the nature of the duties attached to the office or by reason of the powers vested in him, functions mainly of a managerial nature.”

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The determinative factor is the main duties

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performing by the employee and not some work done incidentally. The nature of the duties performed by the workman is a question of fact and the same sets up by pleading, evidence thereof.

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The work undertaken by the respondent is that of an ITI Technician trainee and though the trainee is doing clerical work, the facility of training given to him is only for the purpose of carrying out the assignment during the said period and it does not confer any right on the respondent to claim employment. The trainee gets a stipend, not wages. The person who gets a stipend does not come under the purview of ‘workman’ under Section 2(s) of the ID Act.

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Insofar as termination of the respondent is concerned, the order of employment itself clearly sets out the terms therein, which makes it clear that the facility of providing training to the respondent could be put to an end at any time without assigning any reason whatsoever and his services could be regularized only on satisfactory completion of the training period. When the terms and conditions of training categorically state that there is no guarantee in absolving the trainee after completion of his

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training as a regular employee, such a trainee cannot seek employment after termination of the training arrangement.

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Mere completion of the training conferred no right on the respondent to claim appointment. The employment was accepted fully knowing the nature of the work and the consequences flowing from it, even otherwise, while accepting the employment, the person concerned knows the nature of his employment and it is not an appointment to a post in the real sense of the term, since the appointment of the petitioner was for a temporary period and petitioner notices engagement as contractual or casual workman as per the terms of the engagement.

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The termination of service of the respondent after the expiry of the training period agreed upon or such appointment being terminated would fall under Exception to clause (bb) of Section 2(oo) of the ID Act. The termination of an employee on expiry of the prescribed period will not amount to termination since such

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termination is excluded under Clause (bb) of Section 2(oo) of the ID Act, for the foregoing reasons, the point framed for consideration is answered accordingly and this Court pass the following:

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ORDER

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