Reinstatement with back wages is not automatic and may be substituted with lump-sum compensation for wrongful termination.

The Petitioner (Management) challenged a Labour Court award dated 11.10.2018, which directed the reinstatement of the Respondent (Workman) with full backwages and continuity of service

The Workman, employed as a Security Supervisor since 2001, alleged his services were terminated on 16.03.2013 without notice after he demanded statutory benefits

The Management contended that the Workman unauthorizedly absented himself after refusing a transfer to an alternate site following the closure of his original deployment

During the pendency of the dispute, a separate claim under the Minimum Wages Act was settled for Rs. 12,000

The Labour Court found the termination illegal as the Management failed to produce evidence of site closure or the service of the deployment letter

During writ proceedings in 2021, the Management offered to reinstate the Workman, but the directions were not complied with

1. Whether the findings of the Labour Court regarding illegal termination were perverse or outside its jurisdiction, warranting interference under Article 226 of the Constitution?

2. Whether the relief of reinstatement with full backwages is automatic in cases of wrongful termination, or if it can be substituted with lump-sum compensation?

The Court emphasized that writ jurisdiction under Article 226 is limited to correcting jurisdictional errors or perversity and is not an appeal (Syed Yakoob v. K.S. Radhakrishnan; Ritz Theatre Private Limited v. Ramesh Chandra)

Regarding relief, the Court applied the principle from Deepali Gundu Surwase v. Kranti Junior Adhyapak Mahavidyalaya, which establishes that while reinstatement is the normal rule for wrongful termination, it is subject to factors like length of service and the employer's financial condition

It further relied on Jagbir Singh v. Haryana State Agriculture Mktg. Board and Allahabad Bank v. Krishan Pal Singh, holding that reinstatement with full backwages is not automatic and compensation can be granted to meet the ends of justice

The Court upheld the Labour Court’s finding of illegal termination, noting that the Management failed to lead evidence regarding the closure of the Workman’s original site or the validity of the deployment order, which the Workman claimed was antedated

The Court scrutinized the relief granted, noting that the Workman is now 57 years old and has been out of service since 2013

Despite a 2021 court order where the Management expressed willingness to take the Workman back, the Workman never actually rejoined

Following the shift in legal position that favors compensation over reinstatement in specific factual matrices, the Court determined that directing reinstatement after a long lapse of time was inappropriate

The Court linked the relief to the Workman's last drawn salary (Rs. 6,576/-) and the prior settlement under the Minimum Wages Act to arrive at a fair quantum

It held that a lump-sum compensation in lieu of reinstatement and backwages would better serve the ends of justice given the passage of time and the facts of the case

The Petitioner was directed to pay the Workman Rs. 8 lakhs within six weeks, failing which interest at 12% per annum would apply

The writ petition was disposed of with these modifications to the original award