Long-serving daily-wage employees are entitled to permanency benefits and minimum pay despite no sanctioned posts.

The respondents were daily-wage employees engaged by Nagar Palika Nigam Sagar as Assistant Revenue Inspectors (Moharirs).

The judgment records their engagement as dating from 1994, while later referring to engagement in 1989 and 1994.

The Labour Court’s order dated 29 February 2016 directed their classification as permanent employees under the Industrial Disputes Act, 1947, but did not direct regularisation.

The appellant relied on a roster showing that all 32 sanctioned posts were filled, and argued that no sanctioned posts were available for the respondents.

The writ petitions challenging the Labour Court’s order were dismissed on 15 February 2023; the Nigam appealed.

The judgment states that two of the three respondents had retired and one remained in service.

1. Whether the respondents’ lack of available sanctioned posts justified denying them permanent classification or the benefits of regularisation and the minimum pay scale, despite their long service performing Assistant Revenue Inspector work.

2. Whether the writ court’s dismissal of the Nigam’s petitions, and the Labour Court’s direction to classify the respondents as permanent employees, warranted interference in appeal.

The Court proceeded under Section 2(1) of the Madhya Pradesh Uchcha Nyayalaya Khandpith ko Appeal Adhiniyam, 2005, which provided the basis for the appeals.

It referred to the Industrial Disputes Act, 1947, under which the Labour Court had ordered permanent classification, and to the Madhya Pradesh Nagar Palika Nigam (Officers and Employees’ Appointment and Service Conditions) Rules, 2000, which provided for 32 sanctioned posts.

The Court relied on Ramnaresh Rawat v. Ashwini Rai, (2017) 3 SCC 436, and the State Government’s policy/circular dated 7 October 2016 concerning regularisation benefits for daily-rated employees.

It also invoked the principles against exploitative and insecure use of temporary employment, quoting paragraphs 22 and 25 of Jaggo v. Union of India; the reference text gives the citation as “[(2006) 4 SCC 1]”.

The Court’s stated principle was that prolonged daily-wage service performing work also required by the employer could not, in the circumstances, be met with a denial of the claimed employment benefits solely on the ground that sanctioned posts were unavailable.

The Court rejected the Nigam’s vacant-post argument because the respondents had performed Assistant Revenue Inspector work for many years, and the Nigam had continued to take that work until two respondents retired.

It reasoned that the existence of continuing work was inconsistent with the suggestion that there was no need for their services; it also observed that, when vacancies arose in 2000, the Nigam should have considered the respondents for regularisation rather than filling Assistant Revenue Inspector posts through direct recruitment.

Applying Ramnaresh Rawat, the 2016 policy and the principles against exploitative temporary employment, the Court considered the respondents entitled to the benefits of permanent status or regularisation and the minimum pay scale, notwithstanding the Nigam’s arguments concerning sanctioned posts and the applicability of standing orders.

It dismissed all three appeals and directed that the Labour Court’s and High Court’s orders be implemented forthwith.