Payment of employment-injury compensation does not justify denying continued employment to a fit worker.

The workman, employed at the petitioner’s estate, suffered an accident in 2000 that resulted in the amputation of his right hand.

After the accident, he worked as a Watcher from 2 April 2001 to 31 March 2004.

The Management paid him compensation for his employment injury under an agreement dated 31 March 2004, and denied him further work from 1 April 2004.

The Labour Court found the denial unjustified and ordered reinstatement with 25% back wages.

The Management challenged that award, contending, among other things, that the Labour Court had exceeded the terms of reference and that the workman could not resume his former work.

The writ petition had remained pending for more than twelve years; by the time of judgment, reinstatement was no longer practicable.

1. Whether the Labour Court exceeded the terms of the reference by finding that the Management had engaged in an unfair labour practice by keeping the workman temporary.

2. Whether the denial of employment to the workman from 1 April 2004 was justified, including whether payment of injury compensation or his disability justified ending his work as a Watcher.

3. Whether, given the delay and the impracticability of reinstatement, the Court should set aside the Labour Court’s award and grant compensation instead.

An Industrial Tribunal or Labour Court derives jurisdiction from the terms of the reference and cannot adjudicate matters beyond them; the Supreme Court stated this principle in Pottery Mazdoor Panchayat v. Perfect Pottery Co. Ltd., (1979) 3 SCC 762, and State Bank of Bikaner & Jaipur v. Om Prakash Sharma, (2006) 5 SCC 123.

The Court also referred to Section 11A of the Industrial Disputes Act, 1947, as a basis for moulding relief in the circumstances of this case.

Payment of compensation for an employment injury does not, by itself, disqualify a workman from continuing in another role in the same establishment where the employer does not contend that he is unfit for that role.

The Management relied on Talwara Cooperative Credit and Service Society Ltd. v. Sushil Kumar, (2008) 9 SCC 486, on back wages, but the Court did not make it the basis of its final relief.

The Court held that the reference concerned only whether the denial of employment was justifiable; the Labour Court therefore exceeded its remit by deciding that the Management had engaged in an unfair labour practice through prolonged temporary employment.

The Labour Court’s examination of the domestic enquiry was also unwarranted: the workman’s employment ended on 1 April 2004, before the other worker’s dismissal in April 2005, and the Management did not assert that the denial of work was punishment based on the enquiry.

On the merits, the workman had performed paid Watcher duties for nearly three years, and the Management did not claim that his disability made him unfit for that role.

The injury-compensation payment did not justify discontinuing that employment.

Because of the passage of time and the workman’s age, reinstatement was no longer appropriate; the Court instead assessed compensation.

It nevertheless found that the Management had unjustifiably denied the workman employment as a Watcher and ordered it to pay him ₹80,000 as compensation within two months of receiving the certified judgment.

If unpaid within that period, the amount would carry interest at 8% per annum from 28 September 2026 until payment.