SETC Retiree In Service On 2023 Cutoff To Get 15th Wage-Settlement Benefits With 6% Interest Beyond Schedule: Madras HC

In brief

The question

Whether an employee who was in service on 01.09.2023 but retired before the settlement date was entitled to the pay revision and monetary benefits under the 15th wage settlement.

The court held

The Court allowed the writ petition and directed the Transport Corporation to revise the petitioner’s pay scale from 01.09.2023 and provide the benefits accruing from 01.09.2024 under the 15th wage settlement within six months of receiving a copy of the order.

It also directed

The amounts are to carry interest at 6% per annum for the period beyond Clause 37(b)’s stipulated schedule until actual payment.

No order as to costs.

01Facts

The petitioner, a permanent employee of the respondent Transport Corporation, was in service on 01.09.2023 and retired on 31.05.2025.

pp. 2–4

A wage settlement under Section 12(3) of the Industrial Disputes Act, 1947, dated 29.05.2025, provided for a 6% pay revision notionally from 01.09.2023, with monetary benefits from 01.09.2024 and arrears payable in four quarterly instalments.

pp. 2–4

The petitioner sought implementation of the settlement and payment of associated dues; the Corporation stated that it would calculate and pay any amount due within a reasonable time.

pp. 2–4

02Issues

i.Whether an employee who was in service on 01.09.2023 but retired before the settlement date was entitled to the pay revision and monetary benefits under the 15th wage settlement.

pp. 4–5

ii.Whether the petitioner was entitled to interest on the delayed payment of those benefits.

p. 5

03Law Applied

Section 12(3) of the Industrial Disputes Act, 1947, provides the statutory basis for the wage settlement at issue.

pp. 3–5

Under Clause 1 of the settlement dated 29.05.2025, employees in service on 01.09.2023 were entitled to a 6% pay revision, with monetary benefits from 01.09.2024.

pp. 3–5

Clause 37(b) provided for arrears to be calculated from 01.09.2024 and paid in four quarterly instalments.

pp. 3–5

The Court further held that belated monetary benefits due to an employee should carry interest at 6% per annum for the period beyond that contemplated by Clause 37(b).

pp. 3–5

Provisions in the judgment · 1

Industrial Disputes Act, 1947 Section 12

04Reasoning

The petitioner was in service on the settlement’s qualifying date, 01.09.2023, and therefore fell within the class of employees entitled to the revision, notwithstanding his retirement on 31.05.2025.

pp. 4–5

Since the settlement provided monetary benefits from 01.09.2024 and arrears had not been paid, the Court directed implementation of the revision and payment of the resulting benefits.

pp. 4–5

Given the delay, it applied a 6% interest rate, limiting interest to the period beyond the payment schedule contemplated by Clause 37(b).

pp. 4–5