Maintenance of industrial air-conditioning systems constitutes building operations attracting skilled-worker minimum wages.

Blue Star Limited had a contractual arrangement with the West Bengal Power Development Corporation Limited for the operation and maintenance of the central air-conditioning plant at Bakreshwar Thermal Power Project, including maintenance of air-conditioning systems, cooling towers and allied equipment.

A claim under Section 20(2) of the Minimum Wages Act, 1948 was filed alleging that the petitioner had not paid the minimum wages prescribed under the West Bengal Government notification dated 8 November 1995 for employment in “construction or maintenance of roads or in building operations,” along with subsequent wage-revision notifications.

The workers were designated as operators, technicians, electricians and assistant technicians.

The respondents alleged that the petitioner had artificially downgraded their wage categories after the revised notifications, thereby paying skilled and highly skilled workers at semi-skilled rates.

The petitioner contended that its business concerned the manufacture and maintenance of air-conditioning equipment and did not fall within the scheduled employment under Item 7 of Part I of the Schedule to the Act.

By order no. 87 dated 12 August 2024, the Civil Judge (Senior Division), Suri, directed payment of approximately Rs. 33 lakhs towards wage differentials and compensation. The petitioner challenged that order in the present writ petition.

1. Whether the operation and maintenance of central air-conditioning, HVAC, cooling tower and allied systems at a thermal power plant fall within the scheduled employment of “construction or maintenance of roads or in building operations” under Item 7 of Part I of the Schedule to the Minimum Wages Act, 1948.

2. Whether the concerned employees were properly classifiable as skilled or highly skilled workers, rather than semi-skilled workers, for determining their statutory minimum wages.

3. Whether the order directing payment of differential wages and compensation under Section 20 of the Minimum Wages Act, 1948 was legally unsustainable for want of proper reasoning, reliance on undisclosed material, or improper exercise of discretion.

The Court applied Section 2(g) of the Minimum Wages Act, 1948, which defines “scheduled employment” as employment specified in the Schedule or any process or branch of work forming part of such employment.

It relied on Section 4 concerning fixation and revision of minimum wages for scheduled employments, Section 12(1) requiring payment of not less than the prescribed minimum wage, and Section 20 concerning claims for payment of minimum wages and compensation.

Item 7 of Part I of the Schedule covers employment in “construction or maintenance of roads or in building operations”.

The Court also applied the wage classifications contained in the West Bengal Labour Department notification dated 8 November 1995, treating work requiring technical knowledge, training, experience and responsibility as skilled or highly skilled work.

It relied on Amcon Construction v. Labour Enforcement Officer , 2019 SCC OnLine Del 1218, for the principle that compensation under Section 20(3)(i) is equitable rather than punitive and must be imposed after balancing the interests of the employee and employer.

The Court examined the actual nature of the work rather than the nomenclature assigned by the petitioner.

It found that the employees operated and maintained industrial-scale air-conditioning plants, chillers, AHUs, FCUs, pumps and cooling towers; monitored pressure and temperature; performed preventive maintenance, repairs, electrical checks and emergency interventions; and required technical training and experience.

These functions were materially different from merely switching an air-conditioner on or off, as alleged by the petitioner.

Since HVAC operation and maintenance constitute an integral part of building maintenance and technical facility operations, the work fell within “maintenance … in building operations” under Item 7.

The Court further noted that the petitioner had previously treated the employees as skilled or highly skilled and that the subsequent reduction of their wage classifications, without any change in their duties, appeared to be a device to avoid the higher statutory wage rates.

The Court also considered Government tender documents describing AC mechanics/operators as skilled labour and requiring ITI qualifications and relevant experience.

Consequently, the employees were entitled to the minimum wages applicable to skilled workers in building operations.

The Court found no sufficient ground to interfere with the subordinate court’s order and rejected the petitioner’s challenge to the award of differential wages and compensation.

The concerned employees were entitled to minimum wages applicable to skilled workers, and the petitioner’s classification of them as semi-skilled workers was held to be unsustainable.

The writ petition was dismissed, and order no. 87 dated 12 August 2024 directing payment of approximately Rs. 33 lakhs was left undisturbed.

Connected applications were disposed of and any interim order was vacated.