Labour courts cannot award additional salary without a recorded legal or factual basis.

Respondent No. 2 was appointed by the petitioner-Management as a Consultant on 1 April 2018 and was released from service on the ground of attaining superannuation, allegedly with effect from 1 May 2019.

The Workman approached the Assistant Labour Commissioner for conciliation and thereafter instituted proceedings before the Labour Court, Guwahati, apparently under Section 2A of the Industrial Disputes Act, 1947.

By Award dated 28 July 2022 in Case No. 1/2021, the Labour Court directed the Management to pay full wages for the period from 1 May 2019 to 17 May 2019, two months’ salary, without deducting the one month’s salary already paid in lieu of notice, and litigation costs of ₹10,000.

The Management challenged the Award under Article 226 of the Constitution, principally contending that the Workman had been released with effect from 1 May 2019 and that there was no basis for awarding two months’ salary.

The Workman did not appear before the High Court, and an amicus curiae was appointed to assist the Court.

The original Labour Court records were not produced before the High Court.

Whether the Labour Court was justified in directing payment of wages for the period from 1 May 2019 to 17 May 2019, having regard to the date on which the release letter was served on the Workman.

Whether the Labour Court had any factual or legal basis to direct payment of two months’ salary, either as wages or compensation.

Whether the direction awarding litigation costs of ₹10,000 required interference under Article 226.

The Court exercised its power of judicial review under Article 226 of the Constitution of India over the Labour Court’s Award.

The dispute had been pursued before the Labour Court apparently under Section 2A of the Industrial Disputes Act, 1947, concerning an individual employment dispute.

The Court applied the principle that factual findings of a Labour Court, particularly where supported by material on record and not contradicted by reliable evidence, should not ordinarily be disturbed in writ jurisdiction.

A direction granting monetary relief must have a discernible basis in the pleadings, evidence, findings, or applicable law; an award of two months’ salary unsupported by such reasoning was held to be without jurisdiction.

The High Court upheld the Labour Court’s finding regarding wages up to 17 May 2019 because the release letter relied upon by the Workman bore an acknowledgment dated 17 May 2019, whereas the copy produced by the Management did not bear any date of receipt.

In the absence of the original records and any contrary material, the Labour Court was entitled to conclude that the Workman continued in service until the date of receipt of the release letter.

However, the Court found no discussion, evidentiary basis, or legal reasoning supporting the separate award of two months’ salary.

Although the amicus suggested that the amount could be treated as compensation, the Labour Court had expressly described it as salary and had not awarded it as compensation.

The direction therefore could not be sustained and was treated as having been passed without jurisdiction.

The Management did not seriously oppose the award of ₹10,000 as litigation costs, and that direction was consequently left undisturbed.

The High Court quashed the portion of the Labour Court’s Award directing payment of two months’ salary to the Workman.

The directions to pay wages for the period from 1 May 2019 to 17 May 2019, without deduction from the one month’s salary paid in lieu of notice, and to pay litigation costs of ₹10,000 were upheld.