In the year 1981, the Phosphates Company Limited was incorporated as a joint venture between the Government of India and Rupublic of Nauru with the objective of manufacturing of Di-Ammonium Phosphates. Later on, in the y
CS Professional · Multidisciplinary Case Studies · PYQS · December 2021
In the year 1981, the Phosphates Company Limited was incorporated as a joint venture between the Government of India and Rupublic of Nauru with the objective of manufacturing of Di-Ammonium Phosphates. Later on, in the year 1993, the Republic of Nauru disinvested its entire equity stake to the Government of India and the company became a wholly-owned public sector undertaking of the Government of India having its corporate and registered office at Bhubaneswar. (Odisha) Due to deteriorating financial position of certain public sector units, the Government of India on 19.05.1998 decided to temporarily enhance the age of superannuation of all central public sector employees from 58 years to 60 years on the premise that the move may help industries to cut down their losses. Pursuant to the said order dated 19.05.1998, the Company implemented the said order vide order dated 19.11.1998 with retrospective effect from 27.05.1998. Inspite of the enhancement of age of superannuation, the financial performance of the company still did not improve. The Government of India issued an Office Memorandum dated 22.08.2001 to all central public undertakings including the said company intimating its decision to roll back the age of superannuation of all the employees of public sector undertakings from 60 years to 58 years. Before this Memorandum, the Government of India, on 08.06.2000, had also advised the company to review the decision on enhancement of age of superannuation but the company did not take any decision on the said advisory. In the meanwhile, the Government of India, on 28.02.2002, divested its 74% shareholding in the said company in favour of M/s Zuari Maroc Phosphates Ltd. ("Zuari"), thereby, keeping only 26% shareholding in its favour. As per the shareholding agreements, it was provided that all the decisions taken by the Board of directors of the company, prior to the date of the disinvestment, shall be binding on all concerned. In order to revive its financial health, the Board of directors of the Company decided to fill-up the vacancies of Security Guards by engaging an outsourcing agency. As many as 27 Security Guards were employed through outsourcing against vacant posts. In the month of April 2002, some robbers attacked in midnight with arms weapons. Five security guards who were on duty and safeguarding the property were injured. The robbers could not succeed in their nefarions designs. One security guard lost his hand during the firing and another security guard lost his eye. The Union of Security Guards moved an application for regularization of their jobs and also demanded the same pay scale as given to para-military forces under the principle of Equal Pay for Equal Work. The Union also demanded compensation to injured security guards. The Company rejected their claim on the plea that they were contractual labour. As a consequence, the Union filed a petition. Thereafter, on 17.07.2002, the Company, by office order, withdrew the earlier office order dated 19.11.1998 and restored the age of superannuation to 58 years in respect of all the employees in terms of Certified Standing Orders and Service Rules of the Company. Being aggrieved, the Trade Union raised dispute with regard to the above and the Odisha Government also made a reference under Section 12 read with Section 10 of the Industrial Disputes Act, 1947 to the Industrial Tribunal. What do you mean by 'Equal Work, Equal Pay'? Can the employer differentiate the pay scales for same work or work of a similar nature? Whether the claims of the security guards are sustainable? Give reasons in support of your answer.
Answer & Explanation:
In Matter of State Of Punjab And Ors vs. Jagjit Singh And Ors, Hon'ble Supreme Court held that the principle of 'equal pay for equal work', which meant equal pay for everyone irrespective of sex, was deducible from the Preamble and Articles 14, 16 and 39(d) of the Constitution. The principle of 'equal pay for equal work', was held to be applicable to cases of unequal scales of pay, based on no classification or irrational classification, though both sets of employees (engaged on temporary and regular basis, respectively) performed identical duties and responsibilities. The present case is similar to the case of DTC Security Staff Union (Regd). vs. DTC & Anr. In this case the Hon'ble Supreme Court of India observed that there is no material to hold that pay scale of Deputy Security Officer and Security Officer in the Corporation was consciously kept at par with that of the Delhi Police keeping in mind aspects with regard to the qualifications, nature of duties etc. Merely because the pay scale may have been and remained the same, it cannot lead to the conclusion of a conscious parity on the principle of equal pay for equal work so as to make it discriminatory and a ground for grant of parity to Assistant Security Officer, Security Havildar and Security Guard also. The Tribunal ought to have refrained from going to the exercise of fixation of pay scales no sooner than that it was brought to its attention that a Commission constituted for the purpose was examining the same. Though the Tribunal examined the pay scales given to similarly situated security personnel in other organisations, and also the next below post principle in the Corporation itself, ignoring the difference in the methods of recruitment and qualifications for appointment in the two organisations, it primarily based its conclusion to grant parity of pay scale to Assistant Security Officer, Security Havaldar and Security Guard merely for the reason that parity of pay scale existed for the posts of Deputy Security Officer and Security Officer with that of the Delhi Police. It is not in dispute that the pay scale of the employees of the corporation, including the security cadre, have been revised from time to time in accordance with the recommendations of 4th, 5th, 6th Pay Commission and now the 7th Pay Commission. There is no material on record that the appellant at any time filed any objection or raised issues for grant of appropriate pay scale either before the 4th Pay Commission or the successive Commissions. If the award of the Tribunal is to be implemented today, it will create a highly anomalous position in the Corporation, and shall lead to serious complications with regard to the issues of pay scale vis-a-vis recommendations of the Pay Commission and would generate further heartburn and related problems vis-à vis other employees of the Corporation. The Government of Delhi, which would have had to bear the financial burden, did not concur with the Board of the Corporation to abide by the Award. The vast difference in the nature of general duties performed by personnel of the police force in contradistinction to that of security personnel discharging limited security duties in the confines of the Corporation hardly needs any emphasis. We find no reason to interfere with the order of the Division Bench. Preamble of The Equal Remuneration Act, 1976, states that it is an Act to provide for the payment of equal remuneration to men and women workers and for the prevention of discrimination, on the ground of sex, against women in the matter of employment and for matters connected therewith or incidental thereto. In view of the above, An employer cannot differentiate the pay scales for same work or work of a similar nature on the ground of sex or nomenclature of employment but can do so when there is vast difference in the nature of general duties performed and particularly in light of above judgement, the pay scales of persons employed in public sector undertaking is governed by Pay Commission, can't be objected at later stage by security guards.
Topics: Industrial Law
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