Allowed

Hindustan Steel Construction Ltd., Employee Union affiliated v. The Hindustan Steel Works Construction Ltd.

Telangana HC7 Jun 2013WP/19206/2000

Case brief

AI extract

What is this about?

This order allowed a writ petition challenging a circular that withdrew certain benefits offered under a Voluntary Retirement Scheme. The court held that once benefits were lured workers to opt for the scheme, the employer could not retrospectively withdraw them later.

What did the court decide?

Pending Circular No.PER/RR/531/ 2000/3007 dated 28.08.2000 issued by the first respondent set aside.

Hindustan Steel Construction Ltd… — Pension and Retirement Benefits | Telangana HC (2013)

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THE HON’BLE SRI JUSTICE B.CHANDRA KUMAR WRIT PETITION No.19206 of 2000

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ORDER:-

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This writ petition has been filed by M/s. Hindustan Steel Construction Limited Employees Union, represented by its General Secretary, seeking a Writ of Mandamus declaring the circular issued by the first respondent vide Circular No.PER/RR/531/ 2000/3007 dated 28.08.2000 as illegal and arbitrary.

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The brief facts of the case are as follows:-

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The respondent company, which is a public sector enterprise under the Ministry of Steel, Government of India, is a construction company having its 70 project units spread all over India including project units situated as different steel plants of SAIL, viz., Bokaro, Bhilai, Durgapur, Rourkela, Vizag, etc. It appears that 80% of the employees of the respondent company are deployed at the steel plant project units.

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While so, the respondent company, vide impugned circular, has introduced Voluntary Retirement Scheme to its employees on certain terms and conditions. The benefits offered under the said scheme include the following:-

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3.1 Travelling & Transportation expenses for settlement:-

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At present, the employees on superannuation or separation through VRS are given reimbursement of travelling expenses and cost of transportation of personal effects (by the shortest route) to the recorded hometown only (as per entitlement). This payment is being released as one time payment at the time of such separation.

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If employees are opting for VRS, they will be entitled to reimbursement of travelling expenses and the cost of transportation of personal effects (by shortest route and as per entitlement) either to recorded home town or to the place where children of the employee settled or to any other place in India on the employee’s certification as to the intended place of settlement except for fetched places like Andaman and Nicobar, Lakshadweep, to be treated as one time payment.

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3.2 Half-pay Leave:-

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Employees opting for V.R. will be permitted to encash half-pay leave subject to the condition that commutation leave during the entire period of service shall be limited to a maximum of 180 days. For the purpose of encashment commuted leave already availed of will be deducted from the limit of 180 days. For this purpose, for the workmen who are covered by Standing Orders, Administrative Orders, the accumulation and commutation of half pay leave shall be governed by the provisions of such orders of the specified units/offices.

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3.3 Earned Leave for Workmen:-

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Such workmen as are covered by Standing Orders / Administrative Orders of the specified Units/Offices and who opt for V.R. will be deemed to have earned, for the period prior

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to 1.10.89, additional 15 days earned leave or equivalent thereof per year corresponding to earning of 1 day’s earned leave for every 20 days of actual work performed, and such additional leave may be permitted to be encashed. This is, however, subject to an accumulation of 240 days as per rules.

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Benefit of this additional leave and its encashment is only in the event of Voluntary separation under this scheme by such workmen within 31.12.93.

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For the period with effect from 1.10.89, the existing rules will continue to prevail, i.e., the additional leave of maximum 15 days shall not be allowed to be accumulated or encashed.

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Subsequent to the introduction of the said Scheme extending certain benefits as referred above, many workers have opted for the said Scheme during the period from 18.11.1993 to 28.08.2000 and many of the workers who opted for the said Scheme were also extended benefits as per the provisions of the Scheme. Then, the first respondent issued the impugned circular withdrawing certain benefits of the Scheme, which are as follows:-

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1. The travelling expenses and cost of transportation of personal belongings (household goods) to any place in India, with retrospective effect, will be paid to the employees opting for V.R. on submission of the employees actual claim and not on the basis of certification, in supercession of all earlier decisions circulated from time to time.

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2. The encashment of half pay leave in respect of employees opting for V.R. with

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retrospective effect, will not be permitted for CDA pattern employees in supercession of all earlier decisions in this regard circulated from time to time.

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3. In supercession of earlier decisions, with retrospective effect, the company will recover from time to time, the amount payable to the employees who have made fraudulent certification, if any.

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4. The Board, in supercession of earlier decisions, has further decided that encashment of additional leave prior to 1.10.89 in respect of workmen (opting for V.R.) covered by Standing Orders / Administrative Order will not be allowed.

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The aforementioned decisions of the Board are to be complied with strictly by all concerned.

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The petitioner Union challenges the said circular in this writ petition.

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Sri N. Krishna Murthy, learned counsel for the petitioner submitted that the respondents, having offered certain benefits to the workers under Voluntary Retirement Scheme, cannot withdraw those benefits by issuing another circular. It is also his submission that in view of the benefits extended under the said Scheme, many workers have opted for voluntary retirement from service and most of them would not have opted for the same, had the original Scheme did not contain the benefits which are subsequently withdrawn by the impugned circular. Learned counsel for the petitioner

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had also relied on the judgment of the Calcutta High Court in Writ Petition No.12502 of 2001 and batch, whereunder, a single Judge of the Calcutta High Court, by order dated 13.02.2002, has accepted the contention of the petitioners therein. It was observed that the right of the workers has been crystallized as per the Scheme and after giving them allurement, the respondents may not be justified to say that certain benefits under the Scheme are withdrawn. It was further observed that the subsequent impugned notice cannot have any retrospective operation.

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As seen from the counter, the stand of the respondents is that subsequently, they noticed certain irregularities in implementation of Circular dated 18.11.1993 and apprehended that more and more separate employees will make fraudulent claims of transportation charges (personal effects) and Railway Fares unless immediate steps are taken to stop them.

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Having considered the rival claims, the only point that arises for consideration in this writ petition is whether the respondents are justified in withdrawing the benefits conferred on the employees under Voluntary Retirement Scheme by issuing another circular.

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It has to be seen that even as per the original Scheme, the respondents have given benefit of reimbursement of personal expenses and cost of transportation expenses by the shortest route to the

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recorded home town only.

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Voluntary Retirement Scheme gives an opportunity to the workers to retire from service voluntarily. The workers, if satisfied with the benefits offered to them under the said Scheme, would apply for Voluntary Retirement from the service. Having offered certain benefits by circular dated 18.11.1993, the respondents are not justified in withdrawing the same by issuing another circular dated 28.08.2000. The workers would be attracted by the offerings and certain benefits conferred under the Scheme. Having lured the workers by certain benefits and offerings if they opt for Voluntary Retirement Scheme, the respondents cannot withdraw the same at a subsequent stage and the same would amount to withdrawing a promise made or violating the original terms and conditions of the Scheme. Similar view was taken by the Calcutta High Court in the batch of writ petitions referred supra and I do not see any reason to take contra view.

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In view of the above, the writ petition is allowed by setting aside the Circular No.PER/RR/531/ 2000/3007 dated 28.08.2000 issued by the first respondent. There shall be no order as to costs.

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Miscellaneous petitions, if any, pending in this writ petition shall stand closed.

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_________________________ Justice B.Chandra Kumar

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07^th June, 2013

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Bvv

Hindustan Steel Construction Ltd., Employee Union affiliated v. The Hindustan Steel Works Construction Ltd.

Case brief

What is this about?

What did the court decide?

Hindustan Steel Construction Ltd., Employee Union affiliated v. The Hindustan Steel Works Construction Ltd.

Case brief

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