Full Judgment Text
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PETITIONER:
BANK OF INDIA
Vs.
RESPONDENT:
T.S. KELAWALA AND ORS.WITHS.U. MOTORS PRIVATE LTD.V.THE WORK
DATE OF JUDGMENT04/05/1990
BENCH:
SAWANT, P.B.
BENCH:
SAWANT, P.B.
KULDIP SINGH (J)
CITATION:
1990 SCR (3) 214 1990 SCC (4) 744
JT 1990 (2) 339 1990 SCALE (1)140
ACT:
Payment of Wages Act, 1936: Sections 7(2) and 9--Absence
from work or indulging in go-slow tactics--Pro-rata deduc-
tion/non-payment of wages by employer--Whether justified.
HEADNOTE:
In the former appeal, the appellant is a nationalised
Bank. In 1977, some demands for wage revision made by the
employees of all Banks were pending and in support of their
demands, a call for a country wide strike was given. The
appellant-Bank issued a Circular on September 23, 1977 to
its managers and agents directing them to deduct wages of
the employees for the days they go on strike. The respondent
Unions gave a car for a four hour strike on December 29,
1977. Two days before the strike, the appellant-Bank issued
an Administrative Circular warning the employees that if
they participate in the strike, they would be committing a
breach of their contract of service and they would not be
entitled to salary for the full day and they need not report
for work for the rest of the working hours on that day.
However, the employees went on strike as scheduled, for four
hours which included banking hours of the public, and re-
sumed duty thereafter. The appellant-Bank did not prevent
them from doing so. The appellant Bank by its circular di-
rected the managers and agents to deduct the full day’s
salary of those employees who participated in the strike. On
a writ petition filed by the respondents, the High Court
quashed the said Circular. The Letters Patent Appeal filed
by the appellant was dismissed. Hence, the appeal by the
Bank.
In the latter appeal, the appellant is a company whose
workers had indulged in "go-slow" in July 1984, thereby
bringing down production. The workers did not attend to
their work and were loitering in the premises and were
indulging in go-slow tactics to pressurise the
215
company to concede their demands. The company suspended its
operation by giving a notice of lock out. It did not pay
wages to the workers for July , 1984 on the ground that they
did not work during all the working hours and had not their
wags. The workers’ union filed a complaint before the Indus-
trial Court complaining that the appellant company had
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indulged in unfair labour practice and that the lock-out
declared was illegal- The Industrial Court held that the
deduction of wages for July, 1984 on account of the go-slow
was not justified- It also declared that the company had
committed an unfair labour practice by not paying full
monthly wages to the workers and directed the company to pay
the said wages for the month of July, 1984. Aggrieved, the
appellant company has preferred the appeal.
Allowing the appeals, this Court,
HELD: 1.1 There is no doubt that whenever a worker
indulges in a misconduct such as a deliberate refusal to
work, the employer can take disciplinary action against him
and impose on him the penalty prescribed for it which may
include some deduction from his wages. However, when miscon-
duct is not disputed but is, on the other band, ’ admitted
and is resorted to on a mass scale such as when the employ-
ees go on strike, legal or illegal, there is no need to hold
an inquiry. To insist on an inquiry even in such cases is to
pervert the very object of the inquiry. In a mass action
such as strike it is not possible to hold an inquiry against
every employee nor is it necessary to do so unless, of
course, an employee contends that although he did not want
to go on strike and wanted to resume his duty, he was pre-
vented from doing so by the other employees or that the
employer did not give him proper assistance to resume his
duty though he had asked for it. That was certainly not the
situation in the present case in respect of any of the
employees and that is not the contention of the employees
either. It is true that in the present case when the employ-
ees came back to work after their four-hours strike, they
were not prevented from entering the Bank premises. But
admittedly, their attendance after the four-hours strike was
useless because there was no work to do during the rest of
the hours. It is for this reason that the Bank had made it
clear, in advance, that if they went on strike for the
four-hours as threatened, they would not be entitled to the
wages for the whole day and hence they need not report for
work thereafter- Short of physically preventing the employ-
ees from resuming the work which it was unnecessary to do,
the Bank had done all hi its power to warn the employees of
the consequences of their action and if the employees, in
spite of it, chose to enter the Bank’s premises where they
had no work to do, and in fact did not
216
do any, they did so of their own choice and not according to
the requirement of the service or at the direction of the
Bank. In fact, the direction was to the contrary. Hence, the
later resumption of work by the employees was not in fulfil-
ment of the contract of service or any obligation under it.
The Bank was therefore not liable to pay either full day’s
salary or even the pro rata salary for the hours or work
that the employees remained in the Bank premises without
doing any work. It is not a mere presence of the workmen at
the place of work but the work that they do according to the
terms of the contract which constitutes the fulfilment of
the contract of employment and for which they were entitled
to be paid. [222E-H; 223A-F]
1.2 Although the service regulations do not provide for
a situation where employees on a mass scale resort to ab-
sence from duty for whole day or a part of the day whether
during crucial hours or otherwise they do provide for treat-
ing an absence from duty of an individual employee as a
misconduct and for taking appropriate action against him for
such absence. [224D-E]
2.1. When the contract, Standing Orders, or the service
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rules/ regulations are silent, but enactment such as the
payment of Wages Act providing for wage-cuts for the absence
from duty is applicable to the establishment concerned, the
wages can be deducted even under the provisions of such
enactment. [231F]
2.2. The working class has indisputably earned the right
to strike as an industrial action after a long struggle, so
much so that the relevant industrial legislation recognises
it as their implied right. However, the legislation also
circumscribes this right by prescribing conditions under
which alone its exercise may become legal. Whereas, there-
fore, a legal strike may not invite disciplinary proceed-
ings, an illegal strike may do so, it being a misconduct.
However, whether the strike is legal or illegal, the workers
are liable to lose wages for the period of strike. The
liability to lose wages does not either make the strike
illegal as a weapon or deprive the workers of it. When
workers resort to it, they do so knowing full well its
consequences. During the period of strike the contract of
employment continues but the workers withhold their labour.
Consequently, they cannot expect to be paid. [232C-E]
2.3. The contract, which is this case is monthly, cannot
be subdivided into days and hours. If the contract comes to
an end amidst a month by death, resignation or retirement of
the employee, he would not be entitled to the proportionate
payment for the part of the month
217
he served. If the employment-contract is held indivisible,
it will be so for both the parties. There is no difficulty,
inequity or impracticability in construing the contract as
divisible into different periods such as days and hours for
proportionate reimbursement or deduction of wages, which is
normally done in practice. [232G-H; 233A]
2.4. The contract of employment, Standing Orders or the
service rules provide for disciplinary proceedings for the
lapse on the part of a particular individual or individuals
when the misconduct is disputed. As things stand today, they
do not provide a remedy for mass-misconduct which is admit-
ted or cannot be disputed. Hence, to drive the management to
hold disciplinary proceedings even in such cases is neither
necessary nor proper. The service conditions are not expect-
ed to visualise and provide for all situations. When they
are silent on unexpected eventualities, the management
should be deemed to have the requisite power to deal with
them consistent with law and the other service conditions
and to the extent it is reasonably necessary to do so. The
pro rata deduction of wages is not an unreasonable exercise
of power on such occasions. Whether on such occasions, the
wages are deductable at all and to what extent will, howev-
er, depend on the facts of each case. Although the employees
may strike only for some hours but there is no work for the
rest of the day as in the present case, the employer may be
justified in deducting salary for the whole day. On the
other hand, the employees may put in work after the strike
hours and the employer may accept it or acquiense in it. In
that case the employer may not be entitled to deduct wages
at all or be entitled to deduct only for the hours of
strike. If statutes such as the Payment of Wages Act or the
State enactments like the Shops and Establishments Act
apply, the employer ,may be justified in deducting wages
under their provisions. Even if they do not apply, nothing
prevents the employer from taking guidance from the legisla-
tive wisdom contained in it to adopt measures on the lines
outlined therein, when the contract of employment is silent
on the subject. [233B-F]
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V.T. Khanzode & Ors. v. Reserve Bank of India & Anr.,
[1982] 3 SCR 411; Paluru Ramkrishnaiah & Ors. etc. v. Union
of India & Anr. etc., [1989] 1 JT 595 and Senior Superin-
tendent of Post Office & Ors. v. lzhar Hussain, [1989] 3 JT
411, relied on.
Buckingham and Carnatic Co. Ltd. v. Workers of the
Buckingham and Carnatic Co. Ltd., [1953] SCR 219; V. Ganesan
v. The State Bank of India & Ors., [1981] 1 LLJ 64; State
Bank of India, Canara Bank, Central Bank etc. & Ors. v.
Ganesan, Jambunathan, Venkatara-
218
man, B.V. Kamath, V.K. Krishnamurthy, etc. & Ors., [1989] 1
LLJ 109; Sukumar Bandyopadhyyay & Ors. v. State of West
Bengal & Ors., [1976] IX LIC 1689; Algemene Bank Nederland,
N.V. v. Central Government Labour Court, Calcutta & Ors.,
[1978] II LLJ, 117; V. Ramachandran v. Indian Bank, [1979]
I LLJ 122; Dharam Singh Rajput & Ors. v. Bank of India,
Bombay & Ors., [1979] 12 LIC 1079; R. Rajamanickam, for
himself and on behalf of other Award Staff v. Indian Bank,
[1981] II LLJ 367; R.N. Shenoy & Anr. etc. v. Central Bank
of India & Ors. etc., [1984] XVII LIC 1493; Prakash Chandra
Johari v. Indian Overseas Bank & Anr., [1986] II LLJ 496;
Workmen of M/s. Firestone Tyre & Rubber Co. of India (P)
Ltd. v. Firestone Tyre & Rubber Co., [1976] 3 SCR 369;
Krishnatosh Das Gupta v. Union of India & Ors., [1980] 1 LLJ
42; Sant Ram Sharma v. State of Rajasthan & Anr., [1968] 1
SCR 111; Roshan Lal Tandon v. Union of India, [1968] 1 SCR
185; Secretary of State for Employment v. Associated Society
of Locomotive Engineers and Firemen and Ors. (No. 2), [1972]
2 All ER 949; Miles v. Wakefield Metropolitan District
Council, [1989] I LLJ 335 and Cutter v. Pwell, [1795] 6 TR
320, referred to.
3.1. There cannot be two opinions that go-slow is a
serious misconduct being a covert and a more damaging breach
of the contract of employment. It is an insidious method of
undermining discipline and at the same time a crude device
to defy the norms of work. It has been roundly condemned as
an industrial action and has not been recognised as a legit-
imate weapon of the workmen to redress their grievances. In
fact the model standing orders as well as the certified
standing orders of most of the industrial establishments
define it as a misconduct and provide for disciplinary
action for it. Hence, once it is proved. those guilty of it
have to face the consequences which may include deduction of
wages and even dismissal from service. [237G-H; 238A]
3.2. The proof of go-slow, particularly when it is
disputed, involves investigation into various aspects such
as the nature of the process of production, the stages of
production and their relative importance, the role of the
workers engaged at each stage of production, the pre-produc-
tion activities and the facilities for production and the
activities of the workmen connected therewith and their
effect on production, the factors hearing on the average
production etc. The go-slow further may be indulged in by an
individual workman or only some workmen either in one sec-
tion or different sections or in one shift or both shifts
affecting the output in varying degrees and to different
extent depending upon the nature of product and the produc-
tive process. Even where it is admitted, go-slow may in some
case present
219
difficulties in determining the actual or approximate loss,
for it may have repercussions on production after the go-
slow ceases which may be difficult to estimate. The deduc-
tion of wages for go-slow may, therefore, present difficul-
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ties which may not be easily resoluble. When, therefore,
wages are sought to be deducted for breach of contract on
account of go-slow, the quantum of deduction may become a
bone of contention in most of the cases inevitably leading
to an industrial dispute to he adjudicated by an independent
machinery statutory or otherwise as the parties may resort
to. The simplistic method of deducting uniform percentage of
wages from the wages of all workmen calculated on the basis
of the percentage fail in production compared to the normal
or average production may not always be equitable. It is,
therefore, necessary that in all cases where the factum of
go-slow and/or the extent of the loss of production on
account of it, is disputed, there should he a proper inquiry
on charges which furnish particulars of the go-slow and the
loss of production on that account. The rules of natural
justice require it, and whether they have been followed or
not will depend on the facts of each case. [238B-G]
3.3. In the instant case, there is a finding recorded by
the Industrial Court that there was a go-slow resorted to by
the workmen resulting in loss of production during the said
period. Since the said finding is not challenged, it is not
possible to interfere with it in this appeal. Though the
appellant is justified in deducting wages for the said
period, in the facts and circumstances of the case it is
directed that it will not deduct more than 5 per cent of the
wages of the workmen for the month of July, 1984 when they
indulged in go-slow tactics. [239D-F]
M/s. Bharat Sugar Mills Ltd. v. Shri Jai Singh & Ors.,
[1962] 3 SCR 684; T.S. Kelwala & Ors. v. Bank of India &
Ors., [1981] 43 FLR 341 and Apar (Pvt) Ltd. v.S.R. Samant &
Ors., [1980] II LLJ 344, referred to.
JUDGMENT:
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 2581 of
1986.
Appeal by Certificate from the Judgment and Order dated
15.10.1985 of the Bombay High Court in Appeal No. 547 of
1984.
WITH
Civil Appeal No. 855 of 1987.
220
From the Judgment and Order dated 8.12.1986 of the
Industrial Court, Maharashtra, Bombay in Complaint (ULP) No.
1202 of 1984.
Ashok Desai, Attorney General, G.B. Pai, J. Ramamurthy,
Jitendra Sharma, B.N. Dutt, H.S. Parihar, Vipin Chandra,
R.F. Nariman, P.H. Parekh, N.K. Sahu, Mrs. Urmila Sirur and
Raj Birbal for the appearing parties.
The Judgment of the Court was delivered by
SAWANT, J. These are two appeals involving a common
question of law, viz., whether an employer has a right to
deduct wages unilaterally and without holding an enquiry for
the period the employees go on strike or resort to go-slow.
In CA No. 2581 of 1986 we are concerned with the case of a
strike while in the other appeal, it is a,case of a go-slow.
By their very nature, the facts in the two appeals differ,
though the principles of law involved and many of the au-
thorities to be considered in both cases may be the same.
For the sake of convenience, however, we propose to deal
with each case separately to the extent of the distinction.
Civil Appeal No. 2581 of 1986
2. The appellant in this case is a nationalised bank,
and respondents 1 and 2 are its employees whereas respond-
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ents 3 and 4 are the Unions representing the employees of
the Bank. It appears that some demands for wage-revision
made by the employees of all the banks were pending at the
relevant time, and in support of the said demands the All
India Bank Employees’ Association had given a call for a
countrywide strike. The appellant-Bank issued a circular on
September 23, 1977 to all its managers and agents to deduct
wages of the employees who would participate in the strike
for the days they go on strike. Respondents 3 and 4, i.e.,
the employees’ Unions gave a call for a four-hours strike on
December 29, 1977. Hence, the Bank on December 27, 1977
issued an Administrative Circular warning the employees that
they would be committing a breach of their contract of
service if they participated in the strike and that they
would not be entitled to draw the salary for the full day if
they did so, and consequently, they need not report for work
for the rest of the working hours on that day. Notwithstand-
ing it, the employees went on a four hours strike from the
beginning of the working hours on 29th December 1977. There
is no dispute that the banking-hours for the public covered
the said four hours. The employees, however, resumed
221
work on that day after the strike hours, and the Bank did
not prevent them from doing so. On January 16, 1978, the
Bank issued a Circular directing its managers and agents to
deduct the full day’s salary of those of the employees who
had participated in the strike. The respondents filed a writ
petition in the High Court for quashing the circular. The
petition was allowed. The Bank preferred a Letters Patent
Appeal in the High Court which also came to be dismissed.
Hence, the present appeal.
The High Court has taken the view, firstly, that neither
regulations nor awards nor settlements empowered the Bank to
make the deductions, and secondly, in justice, equity and
good conscience the Bank could not by the dictate of the
impugned circular attempt to stifle the legitimate weapon
given by the law to the workers to ventilate their griev-
ances by resorting to strike. The High Court further took
the view that since strikes and demonstrations were not
banned in the country and despite the inconvenience that
they may cause, they were recognised as a legitimate form of
protest for the workers, the circular acted as a deterrent
to the employees from resorting to a legally recognised mode
of protest. According to the High Court, the circular even
acted as an expedient to stifle the legitimate mode of
protest allowed and recognised by law. The deduction of the
wages for the day according to the Court amounted to unilat-
erally changing the service conditions depriving the workers
of their fixed monthly wages under the contract of service.
The Court also reasoned that under the conditions of serv-
ice, wages were paid not from day to day or hour to hour but
as a fixed sum on a monthly basis. The contract between the
Bank and the workers being not a divisible one, in the
absence of a specific term in the regulations, awards and
settlements, the Bank could not unilaterally reduce the
monthly wage and thus give the employees lesser monthly
wages than the one contracted. The non-observance by the
employees of the terms of the contract may give the employer
a cause of action and a right to take appropriate remedy for
the breach, but the employer was not entitled to deduct any
part of the wages either on a pro rata basis or otherwise.
The High Court further opined that the Bank was not without
a remedy and the employees cannot hold the bank to ransom.
The Bank could get the four-hours strike declared illegal by
recourse to the machinery provided by law or put the erring
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workers under suspension for minor misconduct under Regula-
tion 19.7, hold an enquiry and if found guilty, impose
punishment of warning, censure, adverse remarks or stoppage
of increment for not more than six months as prescribed by
Regulation 19.8. The High Court also rejected the contention
of the Bank that the Bank was entitled to make
222
deductions under Section 7(2) of the Payment of Wages Act,
1936 by holding that the provision enabled the employer to
deduct wages only if the Bank had power under the contract
of employment.
4. The principal question involved in the case, accord-
ing to us, is, notwithstanding the absence of a term in the
contract of employment or of a provision in the service
rules or regulations, whether an employer is entitled to
deduct wages for the period that the employees refuse to
work although the work is offered to them. The deliberate
refusal to work may be the result of various actions on
their part such as a sit-in or stay-in strike at the work-
place or a strike whether legal or illegal, or a go-slow
tactics. The deliberate refusal to work further may be legal
or illegal as when the employees go on a legal or illegal
strike. The legality of strike does not always exempt the
employees from the deduction of their salaries for the
period of strike. It only saves them from a disciplinary
action since a legal strike is recognised as a legitimate
weapon in the hands of the workers to redress their griev-
ances. It appears to us that this confusion between the
strike as a legitimate weapon in the hands of the workmen
and the liability of deduction of wages incurred on account
of it, whether the strike is legal or illegal, has been
responsible for the approach the High Court has taken in the
matter.
5. It is necessary to clear yet another misconception.
There is no doubt that whenever a worker indulges in a
misconduct such as a deliberate refusal to work, the employ-
er can take a disciplinary action against him and impose on
him the penalty prescribed for it which may include some
deduction from his wages. However, when misconduct is not
disputed but is, on the other hand, admitted and is resorted
to on a mass scale such as when the employees go on strike,
legal or illegal, there is no need to hold an inquiry. To
insist on an inquiry even in such cases is to pervert the
very object of the inquiry. In a mass action such as a
strike it is not possible to hold an inquiry against every
employee nor is it necessary to do so unless, of course, an
employee contends that although he did not want to go on
strike and wanted to resume his duty, he was prevented from
doing so by the other employees or that the employer did not
give him proper assistance to resume his duty though he had
asked for it. That was certainly not the situation in the
present case in respect of any of the employees and that is
not the contention of the employees either. Hence, in cases
such as the present one, the only question that has to be
considered is whether, when admittedly the employees refuse
to work by going on strike, the employer is entitled to
deduct wages for the relevant period or not. We
223
thought that the answer to this question was apparent enough
and did not require much discussion. However, the question
has assumed a different dimension in the present case be-
cause on the facts, it is contended that although the em-
ployees went on strike only for four hours and thereafter
resumed their duties, the Bank has deducted wages for the
whole day. It is contended that in any case this was imper-
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missible and the Bank could at the most deduct only pro rata
wages. Normally, this contention on the part of the workers
would be valid. But in a case such as the present one, where
the employees go on strike during the crucial working hours
which generate work for the rest of the day, to accept this
argument is in effect to negate the purpose and efficacy of
the remedy, and to permit its circumvention effectively. It
is true that in the present case when the employees came
back to work after their four-hours strike, they were not
prevented from entering the Bank premises. But admittedly,
their attendance after the four-hours strike was useless
because there was no work to do during the rest of the
hours. It is for this reason that the Bank had made it
clear, in advance, that if they went on strike for the
four-hours as threatended, they would not be entitled to the
wages for the whole day and hence they need not report for
work thereafter. Short of physically preventing the employ-
ees from resuming the work which it was unnecessary to do,
the Bank had done all in its power to warn the employees of
the consequences of their action and if the employees, in
spite of it, chose to enter the Bank’s premises where they
had no work to do, and in fact did not do any, they did so
of their own choice and not according to the requirement of
the service or at the direction of the Bank. In fact, the
direction was to the contrary. Hence, the later resumption
of work by the employees was not in fulfilment of the con-
tract of service or any obligation under it. The Bank was
therefore not liable to pay either full day’s salary or even
the pro rata salary for the hours of work that the employees
remained in the Bank premises without doing any work. It is
not a mere presence of the workmen at the place of work but
the work that they do according to the terms of the contract
which constitutes the fulfilment of the contract of employ-
ment and for which they are entitled to be paid.
6. It is also necessary to state that though, before the
High Court, reliance was placed by the Bank on the provi-
sions of Section 7(2)(b) read with Section 9 of the Payment
of Wages Act, 1936 for a right to deduct the wages for
absence from duty, there is nothing on record to show that
the provisions of the said Act have been made applicable to
the Bank. However, assuming that Act was applicable to the
Bank, we are of the opinion that the relevant discussion of
the
224
High Court has missed the contentions urged by the Bank on
the basis of the said provisions. What was urged by the Bank
was that the said provisions enabled it to deduct wages for
absence from duty. Hence, even if the Service rules/regula-
tions were silent on the point, the Bank could legally
deduct the wages under the said provisions. The High Court
has reasoned that the power given by the said provisions
come into play only when the employer has power to do so,
probably meaning thereby, the power under the Service
rules/regulations. We are unable to appreciate this reason-
ing, which to say the least, begs the question. It is,
therefore, necessary to point out that if the Act was ap-
plicable, the Bank would certainly have had the power to
deduct the wages under the said provisions in the absence of
any service rule regulation to govern the situation.
7. Since the admitted position is that the service rules
do not provide for such a situation, the question as stated
earlier which requires to be answered in the present case,
is whether there exists an implied right in the employer-
Bank to take action as it has done. There is no dispute that
although the service regulations do not provide for a situa-
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tion where employees on a mass scale resort to absence from
duty for whole day or a part of the day whether during
crucial hours or otherwise, they do provide for treating an
absence from duty of an individual employee as a misconduct
and for taking appropriate action against him for such
absence. Since the High Court has indicated a disciplinary
action under the said provision even in the present circum-
stances, we will also have to deal with that aspect. But
before we do so, we may examine the relevant authorities
cited at the Bar.
8. In Buckingham and Carnatic Co. Ltd. v. Workers of the
Buckingham and Carnatic Co. Ltd., [1953] SCR 219 the facts
were that on 1st November, 1948 the night-shift operatives
of the carding and spinning department of the appellant-
Mills stopped work, some at 4 p.m., some at 4.30 p.m. and
some at 5 p.m. and the stoppage ended at 8 p.m. in both the
departments, and at 10 p.m. the strike ended completely. The
apparent cause for the strike was that the management of the
Mills had expressed its inability to comply with the request
of the workers to declare the forenoon of the 1st November,
1948 as a holiday for solar-eclipse. On 3rd November, 1948,
the management put up a notice that the stoppage of work on
the 1st November amounted to an illegal strike and a break
in service within the meaning of the Factories Act and that
the management had decided that the workers who had partici-
pated in the said strike would not be entitled to holidays
with pay as provided by the Act. The disputes having thus
arisen,
225
the State Government referred the matter to Industrial
Tribunal. The Tribunal held that the workers had resorted to
an illegal strike and upheld the view of the management that
the continuity of service of the workers was broken by the
interruption caused by the illegal strike and as a result
the’ workers were not entitled to annual holidays with pay
under Section 49-B(1) of the Factories Act. The Tribunal,
however, held that the total deprivation of leave with pay
was a severe punishment and reduced the punishment by 50 per
cent and held that the workers would be deprived of only
half their holidays with pay. In the appeal before the then
Labour Appellate Tribunal, the Tribunal held, among other
things, that what happened on the night of the 1st November
did not amount to a strike and did not cause any interrup-
tion in the workers’ service. The Tribunal observed that "It
would be absurd to hold that non-permitted absence from work
even for half an hour or less in the course of a working day
would be regarded as interruption of service of a workman
for the purpose of the said section (i.e., Section 49-B(1)
of the Factories Act). We are inclined to hold that the
stoppage of work for the period for about 2 to 4 hours in
the circumstances of the ease is not to be regarded as a
strike so as to amount to a break in the continuity of
service of the workman concerned". In the result, the Tribu-
nal allowed the Union’s appeal and ordered that holidays at
full rates as provided for in Section 49-A of the Factories
Act will have to be calculated on the footing that there was
no break in the continuity of service. This Court set aside
the finding of the Appellate Tribunal by holding that it
could not be disputed that there was a cessation of work by
a body of persons employed in the Mills and that they were
acting in combination and their refusal to go back to work
was concerted, and the necessary ingredients of the defini-
tion of "strike" in Section 2 (q) of the Industrial Disputes
Act existed and it was not a ease of an individual worker’s
failure to turn up for work. Hence, it was an illegal strike
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because no notice had been given to the management, the
Mills being a public utility industry.
In Secretary of State for Employment v. Associated
Society of Locomotive Engineers and Firemen and Ors. (No.
2), [1977] 2 All ER 949, Lord Denning MR observed:
"...It is equally the case when he is employed as one of
many’s to work in an undertaking which needs the service of
all. If he, with the others, takes steps wilfully to disrupt
the undertaking to produce chaos so that it will not run as
it should. then each one who is a party to those steps is
guilty
226
of a breach of his contract. It is no answer for any one of
them to say ’I am only obeying the rule book’, or ’I am not
bound to-do more than a 40 hour week’. That would be all
very well if done in good faith without any wilful disrup-
tion of services; but what makes it wrong is the object with
which it is done. There are many branches of our law when an
act which would otherwise be lawful is rendered unlawful by
the motive or object with which it is done. So here it is
the wilful disruption which is the breach. It means that the
work of each man goes for naught. It is made of no effect. I
ask: is a man to be entitled to wages for his work when he,
with others, is doing his best to make it useless? Surely
not. Wages are to be paid for services rendered, not for
producing deliberate chaos. The breach goes to the whole of
the consideration, as was put by Lord Campbell CJ in Cuckson
v. Stones, [1858] 1 E & E 248 at 255, (1983-60) All ER Rep
390 at 392 and with other cases quoted in Smith’s Leading
Cases (13th Edn., Vol. 2, p. 48), the notes to Cutter v.
Power, [1795] 6 Term Rep 320, (1775-1802)All ER Rep 159)".
In Miles v. Wakefield Metropolitan District Council, [
1989] I LLJ 335 the facts were that the plaintiff, Miles was
the Superintendent Registrar in the Wakefield Metropolitan
District Council. His duties included performing marriages.
As part of trade union action, he declined to perform mar-
riages on Saturdays which day was very popular with marrying
couples. However, on that day he performed his other duties.
The Council, not wanting to terminate his services, imposed
a cut in his remuneration. He sued the Council for payment
but failed. He appealed to the Court of Appeal and was
successful. The appellate court held that he was a statutory
official and there was no contractual relation and the only
action against him was dismissal. Aggrieved by this appel-
late decision, the Council went before the House of-Lords in
appeal. The House of Lords held that the salary payable to
the plaintiff was not an honorarium for the mere tenure of
office but had the character of remuneration for work done.
If an employee refused to perform the full duties which
could be required of him under his contract of service, the
employer is entitled to refuse to accept any partial per-
formance. In an action by an employee to recover his pay, it
must be proved or admitted that the employee worked or was
willing to work in accordance with the contract of employ-
ment or that such service as was given by the employee, if
falling short of. his contractual obligations was accepted
by the
227
employer as sufficient performance of the contract. In a
contract of employment wages and work go together. The
employer pays for the work and the worker works for his
wages. If the employer declines to pay, the worker need not
work. If the worker declines to work, the employer need not
pay- In an action by a worker to recover his pay, he must
allege and prove that he worked or was willing to work. In
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the instant case, the plaintiff disentitled himself to
salary for Saturday morning because he declined to work on
Saturday morning in accordance with his duty. Since the
employee had offered only partial performance of his con-
tract, the employer was entitled, without terminating the
contract of employment, to decline partial performance, and
in that case the employee would not be entitled to sue for
his unwanted service.
In this connection, Lord Templeman stated as follows:
"The consequences of counsel’s submissions demonstrate
that his analysis of a contract of employment is
deficient. It cannot be right that an employer should be
compelled to pay something for nothing whether he dismisses
or retains a worker. In a contract of employment wages and
work go together. The employer pays for work and the worker
works for his wages. If the employer declines to pay, the
worker need not work. If the worker declines to work, the
employer need not pay. In an action by a worker to recover
his pay he must allege and be ready to prove that he
worked or was willing to work ..... "
It may be mentioned here that on the question whether
the employee engaged in some kind of industrial action can
claim wages on the basis of quantum meruit, only two of the
Law Lords expressed themselves in favour, while the other
three did not want to express any definite opinion on the
question.
9. Among the decisions of the various High Courts
relied upon by the parties in support of the respective
cass, we find that except for the decision in V. Ganesan v.
The State Bank of India & Ors., [1981] 1 LLJ 64 given by the
learned Single Judge of the Madras High Court and the deci-
sion of the Division Bench of the same Court in that matter
and other matters decided together in State Bank of India,
Canara Bank, Central Bank etc. & Ors. v. Ganesan,-Jambuna-
than, Venkataraman, B.V. Kamath, V.K. Krishnamurthy, etc. &
Ors., [1989] 1 LLJ 109, all other decisions, namely, (i)
Sukumar Bandyo-
228
padhyyay & Ors. v. State of West Bengal & Ors., [1976] IXLIC
1689; (ii) Algemene Bank Nederland, N.V. v. Central Govern-
ment Labour Court, Calcutta & Ors., [1978] II LLJ, 117;
(iii) V. Ramachandran v. Indian Bank, [1979] 1 LLJ 122; (iv)
Dharam Singh Rajput & Ors. v. Bank of India, Bombay & Ors.,
[1979]12 LIC 1079; (v) R. Rajamanickam, for himself and on
behalf of other Award Staff v. Indian Bank, [1981] II LLJ
367; (vi) R.N. Shenoy & Anr. etc. v. Central Bank of India &
Ors. etc., [1984] XVII LIC 1493 and (vii) Prakash Chandra
Johari v. Indian Overseas Bank & Anr. [1986] II LI J 496,
have variously taken the view that it is not only permissi-
ble for the employer to deduct wages for the hours or the
days for which the employees are absent from duty but in
cases such as the present, it is permissible to deduct wages
for the whole day even if the absence is for a few hours. It
is also held that the contract is not indivisible. Some of
the decisions have also held that the deduction of wages can
also be made under the provisions of the Payment of Wages
Act and similar statutes where they are applicable. It is
further held that deduction of wages in such cases is not a
penalty but is in enforcement of the contract of employment
and hence no disciplinary proceedings need precede it.
Even in V. Ganesan v. The State Bank of India & Ors.,
(supra), it was not disputed on behalf of the employees that
the employer, namely, the Bank had no fight to deduct pro
rata the salary of the officers for the period of absence
from duty. What was contended there was that the Bank was
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not entitled to deduct the salary for the whole three days
on which the employees had staged a demonstration for a
duration of 30 minutes during working hours on two days and
for an hour, on the third day. The learned Judge held that
by permitting the employees to perform their work during the
rest of the day and by accepting such performance the bank
must be deemed to have acquiesced in the breach of contract
by the employees. It is on this fact that the learned Judge
held that the right to deduct salary (obviously for the
whole day) on the principle of "no work no pay" could be
exercised only when there was a term in the contract or when
there was a statutory provision to that effect. The Division
Bench of the said Court in appeal against the said decision
and similar other matters (supra) confirmed the reasoning of
the learned Judge and held that in the absence of either a
term in the contract of service stipulating that if an
employee abstains from doing a particular work on a particu-
lar day, he would not be entitled to emoluments for the
whole day or in the absence of a statutory provision laying
down such a rule, it was impermissible for the employer to
deduct or withhold the emoluments
229
of the employees even for the hours during which they
worked. Having accepted the performance of work from the
employees for the rest of the day, the Banks are bound to
compensate the employees for the work performed by them. In
that very case, the Court also held, on the facts arising
from the other matters before it, that the refusal to per-
form the clearing-house work can only be the subject matter
of a disciplinary action and it cannot straightaway result
in the withholding of the wages for the whole day. Non-
signing of the attendance register and doing work is also
work for which the employees should be compensated by pay-
ment of remuneration.
10. On the specific question whether the management can
take action in situations, where either the contract, Stand-
ing Order or rules and regulations are silent, both parties
relied on further authorities.
In Workmen of M/s. Firestone Tyre & Rubber Co. of India
(P) Limited v. Firestone Tyre & Rubber Co., [1976] 3 SCR 369
on which reliance was placed on behalf of the workmen it was
held that under the general law of master and servant, an
employer may discharge an employee either temporarily or
permanently but that cannot be without adequate notice. Mere
refusal or inability to give employment to the workmen when
he reports for duty, on one or more grounds mentioned in
clause (kkk) of Section 2 of the Industrial Disputes Act is
not a temporary discharge of the workmen. Such a power,
therefore, must be found out from the terms of the contract
of service or the Standing Orders governing the establish-
ment- Hence, even for lay-off of the workmen there must be a
power in the management either in the contract of service or
the standing orders governing the establishment. Ordinarily,
the workmen, therefore, would be entitled to their full
wages when the workmen are laid off without there being any
such power. There was no common law right to lay off the
workmen, and, therefore, no right to deny the workmen their
full wages.
In Krishnatosh Das Gupta v. Union of India & Ors.,
[1980] 1 LLJ 42, it was a case of the employees of the
National Test House, Calcutta who had staged demonstration
after signing the attendance register to register their
protest against suspension of some of their colleagues.
Though the employees signed the attendance register and
attended the office, they did no work on the relevant day.
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As such, a circular was issued by the Joint Director inform-
ing the employees that they would be considered as "not on
duty". By a subsequent circular the same Joint Director
notified to all departments concerned the decision of the
Cabinet that there shall not be pay for no work. Relying on
the said
230
circular the Management of the National Test House effected
on a mass-scale pay-cut from the pay and allowances of the
concerned employees. The circular was challenged by the
employees by a writ petition before the High Court. The High
Court held that in order to deduct any amount from salary,
there must be specific rules relating to the contract of
service of the person concerned.
On behalf of the employers, reliance was placed on a
decision of this Court in Sant Ram Sharma v. State of Rajas-
than & Anr., [1968] 1 SCR 111 for the proposition laid down
there.that in the absence of any statutory rules or a spe-
cific provision in the rules, the Government can act by
administrative instructions. The Court has held there that
though it is true that the Government cannot amend or super-
sede statutory rules by administrative instructions, if the
rules are silent on any particular point, Government can
fill up the gaps and supplement the rules and issue instruc-
tions not inconsistent with the rules already framed.
In Roshan Lal Tandon v. Union of India, [1968] 1 SCR
185, this Court has stated that although the origin of
Government service is contractual in the sense that there is
an offer and acceptance in every case, once appointed to his
post or office, the Government servant acquires a status,
and his rights and obligations are no longer determined by
consent of both parties but by statute or statutory rules
which may be flamed or altered unilaterally by the Govern-
ment. In other words, the legal position of the Government
servant is more of status than of contract. The hallmark of
status is the attachment to legal relationship of rights and
duties imposed by the public law and not by mere agreement
of the parties. The relationship between the Government and
the servant is not like an ordinary contract of service
between a master and servant. The legal relationship is
something entirely different, something in the nature of
status.
In V.T. Khanzode & Ors. v. Reserve Bank of India & Anr.,
[1982] 3 SCR 411, this Court has reiterated that so long as
Staff Regulations are not flamed, it is open to issue admin-
istrative circulars regulating the service conditions in the
exercise of power conferred by Section 7(2) of the Reserve
Bank of India Act, 1934 so long as they do not impinge on
any regulations made under Section 58 of the Act.
The same view with regard to power to issue administra-
tive instructions when rules are silent on a subject has
been reiterated by the Court in Paluru Ramkrishnaiah & Ors.
etc. v. Union of India &
231
Anr. etc., [1989] 1 JT 595 and in Senior Superintendent of
Post Office & Ors. v. Izhar Hussain, [1989] 3 JT 411.
11. The principles which emerge from the aforesaid
authorities may now by stated. Where the contract, Standing
Orders or the service rules/regulations are silent on the
subject, the management has the power to deduct wages for
absence from duty when the absence is a concerted action on
the part of the employees and the absence is not disputed.
Whether the deduction from wages will be pro rata for the
period of absence only or will be for a longer period will
depend upon the facts of each case such as whether where was
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any work to be done in the said period, whether the work was
in fact done and whether it was accepted and acquiesced in,
etc.
It is not enough that the employees attend the place of
work. They must put in the work allotted to them. It is for
the work and not for their mere attendance that the
wages/salaries are paid. For the same reason, if the employ-
ees put in the allotted work but do not, for some
reason--may be even as a protest--comply with the formali-
ties such as signing the attendance register, no deduction
can be effected from their wages- When there is a dispute as
to whether the employees attended the place of work or put
in the allotted work or not, and if they have not, the
reasons therefore etc., the dispute has to be investigated
by holding an inquiry into the matter. In such cases, no
deduction from the wages can be made without establishing
the omission and/or commission on the part of the employees
concerned.
When the contract, Standing Orders, or the service
rules/regulations are silent, but enactment such as the
Payment of Wages Act providing for wage-cuts for the absence
from duty is applicable to the establishment concerned, the
wages can be deducted even under the provisions of such
enactment.
12. Apart from the aforesaid ratio of the decisions and
the provisions of the Payment of Wages Act and similar
statutes on the subject, according to us, the relevant
provisions of the major legislation governing the industrial
disputes, viz., the InduStrial Disputes Act, 1947 also lend
their support to the view that the wages are payable pro
rata for the work done and hence deductible for the work not
done. Section 2 (rr) of the said Act defines "wages" to mean
"all remuneration .... which would, if terms of employ-
ment, expressed or implied, were fulfilled, be payable to
workman in respect of his employment or work done in such
employment ..." while Section
232
2(q) defines "strike" to mean "cessation of work" or "refus-
al to continue to work or accept employment by workman".
Reading the two definitions together, it is clear that wages
are payable only if the contract of employment is fulfilled
and not otherwise. Hence, when the workers do not put in the
allotted work or refuse to do it, they would not be entitled
to the wages proportionately.
13. The decisions including the one impugned in this
appeal which have taken the view which is either contrary to
or inconsistent with the above conclusions, have done so
because they have proceeded on certain wrong presumptions.
The first error, as we have pointed out at the outset, is to
confuse the question of the legitimacy of the strike as a
weapon in the workers’ hands with that of the liability to
lose wages for the period of strike. The working class has
indisputably earned the right to strike as an industrial
action after a long struggle, so much so that the relevant
industrial legislation recognises it as their implied right.
However, the legislation also circumscribes this right by
prescribing conditions under which alone its exercise may
become legal. Whereas, therefore, a legal strike may not
invite disciplinary proceedings, an illegal strike may do
so, it being a misconduct. However, whether the strike is
legal or illegal, the workers are liable to lose wages for
the period of strike. The liability to lose wages does not
either make the strike illegal as a weapon or deprive the
workers of it. When workers resort to it, they do so knowing
full well its consequences. During the period of strike the
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contract of employment continues but the workers withhold
their labour. Consequently, they cannot expect to be paid.
The second fallacy from which the said decisions suffer
is to view the contract of employment as an indivisible one
in terms of the wageperiod. When it is argued that the wages
cannot be deducted pro rata for the hours or for the day or
days for which the workers are on strike because the con-
tract, which in this case is monthly, cannot be subdivided
into days and hours, what is forgotten is that, in that case
if the contract comes to an end amidst a month by death,
resignation or retirement of the employee, he would not be
entitled to the proportionate payment for the part of the
month he served. This was the iniquitous and harsh conse-
quence of the rule of indivisibility of contract laid down
in an English case, Cutter v. Powell, [1795] 6 TR 320 which
was rightly vehemently criticised and later, fortunately not
followed. If the employment-contract is held indivisible, it
will be so for both the parties. We are also unable to see
any difficulty, inequity or impracticability in construing
the contract as divisible into different
233
periods such as days and hours for proportionate reimburse-
ment or deduction of wages, which is normally done in prac-
tice.
The third fallacy was to equate disputed individual-
conduct with admitted mass conduct. A disciplinary proceed-
ing is neither necessary nor feasible in the latter case.
The contract of employment, Standing Orders or the service
rules provide for disciplinary proceedings for the lapse on
the part of a particular individual or individuals when the
misconduct is disputed. As things stand today; they do not
provide a remedy for mass-misconduct which is admitted or
cannot be disputed. Hence, to drive the management to hold
disciplinary proceedings even in such cases is neither
necessary nor proper. The service conditions are not expect-
ed to visualise and provide for all situations. Hence, when
they are silent on unexpected eventualities, the management
should be deemed to have the requisite power to deal with
them consistent with law and the other service conditions
and to the extent it is reasonably necessary to do so. The
pro rata deduction of wages is not an unreasonable exercise
of power on such occasions. Whether on such occasions the
wages are deductible at all and to what extent will, howev-
er, depend on the facts of each case. Although the employees
may strike only for some hours but there is no work for the
rest of the day as in the present case, the employer may be
justified in deducting salary for tile whole day. On the
other hand, the employees may put in work after the strike
hours and the employer may accept it or acquiesce in it. In
that case the employer may not be entitled to deduct wages
at all or be entitled to deduct them only for the hours of
strike. If further statutes such as the Payment of Wages Act
or the State enactments like the Shops and Establishments
Act apply, the employer may be justified in deducting wages
under their provisions. Even if they do not apply, nothing
prevents the employer from taking guidance from the legisla-
tive wisdom contained in it to adopt measures on the lines
outlined therein, when the contract of employment is relent
on the subject.
14. It is, however, necessary to reiterate that even in
cases such as the present one where action is resorted to on
a mass scale, some employees may not be a party to the
action and may have genuinely desired to discharge their
duties but could not do so for failure of the management to
give the necessary assistance or protection or on account of
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other circumstances. The management will not be justified in
deducting wages of such employees without holding an in-
quiry. That, however, was not the grievance of any of the
employees in the present case, as pointed out earlier.
234
15. Hence, we are unable to sustain the impugned deci-
sion which is untenable in law. The decision is accordingly
set aside with no order as to costs.
Civil Appeal No. 855 of 1987
16. The facts in this case are different from those in
the earlier appeal. In this case, the allegation of the
employer Company is that the workers had indulged in "go-
slow" and as a result there was negligible production in the
month of July 1984. The workers did not attend to their duty
and only loitered in the premises and indulged in go-slow
tactics only with a view to pressurise the Company to con-
cede demands. The Company was, therefore, compelled to
suspend its operation by giving a notice of lock out. Ac-
cording to the Company, therefore, since the workers had not
worked during all the working hours, they had not earned
their wages. Hence, the Company did not pay the workers
their wages for the entire month of July 1984. The workers’
Union, therefore, filed a complaint before the Industrial
Court under the Maharashtra Recognition of Trade Unions and
Prevention of Unfair Labour Practices Act, 1971 (MRTU & PULP
Act, for short) complaining that the Company had indulged in
unfair labour practice mentioned in Item 9 of Schedule 4,
from 7th August, 1984 which was the date for payment of
salary for the month of July 1984, and under Item 6 of
Schedule 2 of the Act with effect from 14th August, 1984
since the Company had declared a lock-out from that day. It
was also alleged that since no specific date of the com-
mencement of the alleged lock-out had been specified, it was
an illegal one.
17. It appears that the Company had declared the lock-
out by notice dated July 30, 1984 and the lock out was
effected from August 14, 1984. Subsequently, there were
negotiations between the Union and the Company, and a set-
tlement was reached on October 15, 1984 as a result of which
the lock out was lifted with effect from October 16, 1984.
The terms of the settlement were formally reduced to writing
on November 30, 1984.
18. In this appeal, we are not concerned with the lock-
out and the subsequent settlement. The question that falls
for consideration before us is whether the Company was
justified in denying to the workers the full monthly wages
for the month of July 1984. On this question, the Industrial
Court accepted the oral testimony of the Company’s witnesses
that the workmen had not at all worked for full eight hours
on any day in July 1984 and that they were working intermit-
235
tently only for some time and sitting idle during the rest
of the day. On an average the workers had not worked for
more than one hour and 15 to 20 minutes per day, during that
month. The Industrial Court did not accept the evidence of
the Union’s witness that the witness and the other workmen
had worked on all the days during the entire month of July
1984 because he admitted that after the Company told the
workers that it could not concede to the demands, the work-
ers had started staging demonstration. Although the witness
denied that from July 3, 1984, the workers started indulging
in go-slow, he admitted that the Company was displaying
notices from time to time with effect from July 4, 1984
alleging that the workers were not giving production and
that they were loitering here and there. According to the
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Industrial Court in the circumstances, it did not see any
good reason to disbelieve the Company’s witnesses. The Court
further held that normally in view of this evidence on
record, it would have held that the pro rata deduction of
wages made by the Company for the month of July 1984 would
not amount to an act of unfair labour practice falling under
Item 9 of Schedule IV of the MRTU and PULP Act. However, in
view of the two judgments of the Bombay High Court in T.S.
Kelwala & Ors. v. Bank of India & Ors., [1981] 43 FLR 341
i.e. the one impugned in the earlier appeal and Apar (Pvt)
Limited v.S.R. Samant & Ors., [1980] II LLJ 344, the Court
had to hold that the non-payment of full wages to the work-
men for the month of July 1984 was an act of unfair labour
practice falling under the said provision of the Act. The
Court further held that admittedly the workers were not
piece-rated and there was no agreement or settlement allow-
ing the Company to deduct wages on the ground that they were
indulging in "go-slow" or that they had not given normal
production. According to the Court, the remedy of the Compa-
ny against the workmen may lie elsewhere. Thus, the Court
taking sustenance from the Bombay High Court Judgments
referred to above held that the deduction of wages during
the month of July, 1984 on account of the go-slow was not
justified, and declared that the Company had committed an
unfair labour practice by not paying full monthly wages to
the workmen, and directed the Company to pay the said wages
for the month of July 1984. It is this order of the Indus-
trial Court which is challenged directly in this Court by
the present appeal.
19. Since one of the two decisions of the Bombay High
Court on which the Industrial Court relied was rendered in
another context and it has already been discussed in the
other appeal, we may refer here only to the other decision,
viz., Apar (Pvt) Ltd. v. S.R. Samant & Ors., (supra) which
is pressed in service before us on behalf of the workmen.
The facts in that case were that by a settlement dated Au-
236
gust 3, 1974 the workmen were allowed increase in the basis
wages, dearness allowance, house rent, etc. in addition to
the production bonus in terms of a scheme. That settlement
was binding on the parties upto the end of April 1977. The
matters ran a smooth course till August 1975. However, from
September 1975, the Company refused to pay the production
bonus and with effect from 15th October, 1975 it refused to
pay the wages, dearness allowances etc. as per the settle-
ment. On August 21, 1975, a notice was put up by the Company
starting that because of the attitude of indiscipline on the
part of the workers and deliberate go-slow tactics resulting
in low production, the management was relieved of its com-
mitments and obligation imposed upon it by the settlement. A
notice in terms of Section 9A of the Industrial Disputes
Act, 1947 was also put up indicating a certain scale of
wages to which only the workers would be entitled. These
wages were not more than the wages under the Minimum Wages
Act and were even less than what was agreed to in the earli-
er agreement of January 23, 1971. A complaint was, there-
fore, filed under the MRTU & PULP Act before the Industrial
Court, and the Industrial Court recorded a finding that the
figures of production produced by the Company before it
related only to few departments. Out of total of 700 employ-
ees who were working earlier, 116 were retrenched at the
relevant time. The Company’s allotment of material, viz.,
aluminium was also reduced from 7390 metric tones to 2038
and there was no supply of even that allotted quantity. The
Court further referred to certain inconsistent statements
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made by the factory-manager and held that the management had
failed to discharge the burden of proof of justifying the
drastic reduction of the wages and other emoluments. The
Court therefore recorded a finding that the Company had
engaged in an unfair labour practice. Against the said
decision, the Company preferred a writ petition before the
High Court. The High Court on these facts held that the
wages could be deducted only in terms of a statutory provi-
sion or of a settlement. A reduction of wages on the allega-
tion that the workers in general had resorted to go-slow was
wholly impermissible in law specially when the workmen were
not piece-rated employees. The High Court referred to the
cases where reduction of wages for absence from duty for
striking work was held as valid such as Major Kanti Bose &
Ors. v. Bank of India & Ors., (supra); V. Ramachandran v.
Indian Bank, (supra) and Algemene Bank, Nederland v. Central
Government Labour Court, Calcutta, (supra) and held that
those cases were distinguishable because they related to
absence from duty and not go-slow.
In M/s. Bharat Sugar Mills Ltd. v. Shri Jai Singh & Ors.,
[1962] 3
237
SCR 684 the facts were that certain workmen of the appel-
lant-Mills resorted to "go-slow". The appellant-Mills held a
domestic inquiry and as a result thereof decided to dismiss
21 workmen, and apply to the Industrial Tribunal under
Section 33 of the Industrial Disputes Act for permission to
dismiss the workmen. Evidence was laid before the Tribunal
to prove the charge against the workmen. The Tribunal held
that the domestic enquiry was not proper, that the appellant
was guilty of mala fide conduct and victimisation, that
except in the case of one workman, the others were guilty of
deliberate go-slow and accordingly granted permission in
respect of the one workman only. It is against the said
decision that the appellant-Mills had approached this Court.
This Court held that the evidence produced before the Tribu-
nal clearly established that 13 out of the 20 workmen were
guilty of deliberate go-slow and in that connection observed
as follows:
"Go-slow which a picturesque description of deliberate
delaying of production by workmen pretending to be engaged
in the factory is one of the most pernicious practices that
discontended or disgruntled workmen sometime resort to. It
would not be far wrong to call this dishonest. For, while
thus delaying production and thereby reducing the output the
workmen claim to have remained employed and thus to be
entitled to full wages. Apart from this also, "go-slow" is
likely to be much more harmful than total cessation of work
by strike. For, while during a strike much of the machinery
can be fully turned off, during the "go-slow" the machinery
is kept going on a reduced speed which is often extremely
damaging to machinery parts. For all these reasons "go-slow"
has always been considered a serious type of misconduct."
This Court, therefore, set aside the order of the Tribunal
refusing permission to dismiss 13 of the workmen.
20. There cannot be two opinions that go-slow is a
serious misconduct being a covert and a more damaging breach
of the contract of employment. It is an insidious method of
undermining discipline and at the same time a crude device
to defy the norms of work. It has been roundly condemned as
an industrial action and has not been recognised as a legit-
imate weapon of the workmen to redress their grievances. In
fact the model standing orders as well as the certified
standing orders of most of the industrial establishments
define it as a misconduct and provide for a disciplinary
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action for it. Hence, once it is
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proved, those guilty of it have to face the consequences
which may include deduction of wages and even dismissal from
service.
But by its very nature, the proof of go-slow, particu-
larly when it is disputed, involves investigation into
various aspects such as the nature of the process of produc-
tion, the stages of production and their relative impor-
tance, the role of the workers engaged at each stage of
production, the pre-production activities and the facilities
for production and the activities of the workmen connected
therewith and their effect on production, the factors bear-
ing on the average production etc. The go-slow further may
be indulged in by an individual workman or only some workmen
either in one section or different sections or in one shift
or both shifts affecting the output in varying degrees and
to different extent depending upon the nature of product and
the productive process. Even where it is admitted, go-slow
may in some case present difficulties in determining the
actual or approximate loss, for it may have repercussions on
production after the go-slow ceases which may be difficult
to estimate. The deduction of wages for go-slow may, there-
fore, present difficulties which may not be easily resolu-
ble. When, therefore, wages are sought to be deducted for
breach of con tract on account of go-slow, the quantum of
deduction may become a bone of contention in most of the
cases inevitably leading to an industrial dispute to be
adjudicated by an independent machinery statutory or other-
wise as the parties may resort to. It is necessary to empha-
size this because unlike in this case of a strike where a
simple measure of a pro rata deduction from wages may pro-
vide a just and fair remedy, the extent of deduction of
wages on account of a go-slow action may in some case raise
a complex question. The simplistic method of deducting
uniform percentage of wages from the wages of all workmen
calculated on the basis of the percentage fail in production
compared to the normal or average production may not always
be equitable. It is, therefore, necessary that in all cases
where the factum of go-slow and/or the extent of the loss of
production on account of it, is disputed, there should be a
proper inquiry on charges which furnish particulars of the
go-slow and the loss of production on that account. The
rules of natural justice require it, and whether they have
been followed or not will depend on the facts of each case.
21. In the present case, the Industrial Court, as point-
ed out earlier, has accepted the evidence of the witness of
the Company that the workmen had not worked for full eight
hours on any day in the month concerned, namely, July 1984,
and that they were working intermittently only for sometime
and were sitting idle during the rest
239
Of the time. According to him, the workers had worked hardly
for an hour and 15 to 20 minutes on an average during the
said month. The witness had also produced notices put up by
the Company from time to time showing the daily fall in the
production and calling upon the workmen to resume normalcy.
There is further no dispute that the copies of these notices
were sent to the Union of the workmen as well as to the
Government Labour Officer. The Industrial Court did not
accept the evidence of the workmen that there was no go-slow
as alleged by the Company. Accordingly, the Industrial Court
has recorded a finding that the pro rata deduction of wages
made by the Company for the month of July 1984 did not
amount to an act of unfair labour practice within the mean-
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ing of the said Act. It does not further appear from the
record of the proceedings before the Industrial Court that
any attempt was made on behalf of the workmen to challenge
the figures of production produced by the Company. These
figures show that during the entire month of July 1984, the
production varied from 7.06 per cent of 13.9 per cent of the
normal production. The Company has deducted wages on the
basis of each day’s production. In view of the fact that
there is a finding recorded by the Industrial Court that
there was a go-slow resorted to by the workmen and the
production was as alleged by the Company during the said
period, which finding is not challenged before us, it is not
possible for us to interfere with it in this appeal. As
stated above, all that was challenged was the right of the
employer to deduct wages even when admittedly there is a
go-slow which question we have answered in favour of the
employer earlier. The question with regard to the quantum of
deduction from the wages, therefore, does not arise before
us for consideration. It is, however, likely that the work-
men did not question the figures of production before the
Industrial Court because they were armed with the two deci-
sions of the High Curt (supra) which according to them, had
negatived the right of the employer to deduct wages even in
such circumstances. While, therefore, allowing the appeal,
we direct that the appellant will not deduct more than 5 per
cent of the wages of the workmen for the month of July 1984.
22. The appeal is allowed accordingly with no order as to
costs.
G.N. Appeals allowed.
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