Reinstatement upheld where employer fails to substantiate claim of employment through an outsourcing agency.

The respondent-workman was engaged as a part-time Sweeper by the petitioner-Panchayat on June 14, 2000

His services were terminated on September 2, 2002, leading to Reference (LCD) No. 840 of 2008, wherein the Labour Court directed his reinstatement with continuity of service but without back wages by an award dated December 17, 2014

He was reinstated on November 24, 2016

the petitioners alleged that this reinstatement was facilitated through an outsourcing agency (Respondent No. 2) and that the workman ceased work on July 1, 2018

The workman filed a second reference (LCD No. 1 of 2019) challenging this subsequent termination.

The Labour Court, Dahod, by award dated June 24, 2022, directed reinstatement with 50% back wages, finding the termination illegal

The petitioners challenged this award before the High Court, contending that no employer-employee relationship existed as the workman was an employee of the outsourcing agency

1. Whether the Labour Court was justified in directing the reinstatement of the respondent-workman with 50% back wages despite the petitioners' claim of an outsourcing arrangement

2. Whether the termination of the respondent-workman on July 1, 2018, was in violation of the statutory requirements of Section 25F of the Industrial Disputes Act, 1947

Section 25F of the Industrial Disputes Act, 1947, which mandates the procedure for the retrenchment of workmen, including notice and compensation

principle that when a court directs reinstatement to an "original post," the employer cannot unilaterally alter the nature of employment by shifting the workman to an outsourcing agency to bypass employer-employee obligations

The Court observed that the workman was originally engaged in 2000, long before the State Government’s outsourcing policy was implemented

Following the 2014 award, the petitioners were legally bound to reinstate him to his original post.

The Court found that the petitioners failed to produce any documentary evidence during the reference proceedings or before the High Court to substantiate the claim that the workman was an employee of the Respondent No. 2 outsourcing agency

the petitioners failed to justify the reasons for termination or prove the allegations of unsatisfactory work

Consequently, the Labour Court’s finding that the petitioners violated Section 25F by terminating the workman without following due legal process was held to be based on a correct appreciation of the evidence

The Court affirmed that since the petitioners failed to prove the existence of a purely contractual relationship through an intermediary, the workman remained their employee.

The Court dismissed the Special Civil Application, upheld the Labour Court’s direction for reinstatement with 50% back wages, and vacated all interim relief