Termination of a daily-wage worker requires departmental enquiry if punitive, or compliance with Section 25F if simpliciter.

The respondent joined NDMC as a beldar on muster roll with effect from 18 November 1986.

His services were terminated with effect from 30 September 1993 without reasons stated in the termination order.

The Labour Court found that he had worked for 287 days during the twelve months preceding termination and was therefore entitled to the protection of Section 25F of the Industrial Disputes Act, 1947.

As neither notice nor retrenchment compensation had been provided, and no disciplinary enquiry had been conducted despite allegations of misconduct, the Labour Court held the termination illegal and awarded reinstatement with 50% back wages.

NDMC challenged the award under Article 226 of the Constitution, contending that the respondent had been removed for misconduct and, as a daily-wage muster-roll worker, was not entitled to a departmental enquiry.

During the proceedings, the respondent was granted relief under Section 17B of the Industrial Disputes Act.

Whether the respondent’s termination was retrenchment attracting the safeguards under Section 25F of the Industrial Disputes Act, 1947.

Whether termination on the ground of alleged misconduct, without a show-cause notice or departmental enquiry, was legally sustainable merely because the respondent was a daily-wage muster-roll worker.

Whether reinstatement with 50% back wages was the appropriate relief, or whether it should be substituted with monetary compensation.

The Court held that its jurisdiction under Article 226 is supervisory and not appellate; interference with a Labour Court’s award is warranted only where the award is arbitrary or perverse.

A workman who has completed the requisite period of continuous service is entitled to the safeguards under Section 25F of the Industrial Disputes Act, 1947, including notice and retrenchment compensation.

Where termination is founded on misconduct or carries a stigma, it is punitive and cannot be sustained without a fair departmental enquiry and an opportunity of defence, irrespective of the employee’s status as a daily wager or muster-roll worker.

The Court relied on M.C.D. v. Praveen Kumar Jain, (1998) 9 SCC 468, which held that a muster-roll daily wager cannot be terminated by way of punishment without a regular departmental enquiry.

The Court further applied the principle that illegal termination does not automatically entitle a workman to reinstatement with full or partial back wages; the appropriate relief depends on the circumstances of each case.

The respondent’s muster-roll and the management witness’s admission established that he had worked for 287 days in the twelve months preceding termination, bringing him within the protection of Section 25F.

If NDMC’s case was that the termination was a simple discharge, it failed because the statutory safeguards of notice and compensation were not complied with.

Conversely, if the termination was punitive and based on the alleged indecent conduct involving female staff, it was stigmatic and invalid for want of a show-cause notice, opportunity of defence, and departmental enquiry.

The respondent’s daily-wage status did not dispense with the requirement of an enquiry where misconduct was the foundation of termination, as clarified in Praveen Kumar Jain.

The Labour Court’s finding of illegality was therefore neither arbitrary nor perverse and warranted no interference under Article 226.

However, considering the respondent’s status as a daily wager, his approximately seven years of service, the prolonged payment of Section 17B amounts, and the fact that he had not rendered services during the intervening period, the Court considered lump-sum compensation more appropriate than reinstatement.

It held that the termination was unlawful either because it violated Section 25F, if treated as a discharge simpliciter, or because it was punitive and unsupported by a departmental enquiry, if treated as a termination for misconduct.

However, the relief of reinstatement with 50% back wages was modified.

In lieu of reinstatement, NDMC was directed to pay the respondent a lump-sum compensation of ₹3,00,000 within eight weeks.

The compensation was directed to be paid over and above amounts validly paid under Section 17B of the Industrial Disputes Act.

The writ petition was disposed of accordingly.