GURU JAMBHESHWAR UNIVERSITY, HISAR versus DHARAM PAL

GURU JAMBHESHWAR UNIVERSITY, HISAR versus DHARAM PAL

For a monthly paid workman, 'average pay' as used in Section 25-F(b) of the Industrial Disputes Act, 1947 is to be calculated as the average wages for the previous three complete calendar months divided by three. The principle of dividing monthly wages by twenty-six working days, which applies under the Payment of Gratuity Act (after statutory amendment), does not apply under the Industrial Disputes Act, since no such amendment has been made. Therefore, the compensation paid by the University was in full compliance with Section 25-F(b).

Parties
Appellant: Guru Jambheshwar University, Hisar; Respondent: Dharampal
Jurisdiction
India
Judgment Date
17 January 2007
Procedural Posture
Civil Appeal / Decision on Appeal From High Court Summary Dismissal of Writ Petition Challenging Labour Court Award
Outcome
Appeal allowed
Legal Topics
Retrenchment Compensation, Calculation of Average Pay, Industrial Disputes Act Interpretation
Labour Law Retrenchment Compensation Calculation of Average Pay Industrial Disputes Act Interpretation

Case Brief

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Parties

Guru Jambheshwar University, Hisar

Appellant

Dharampal

Respondent

Procedural Posture

Civil Appeal / Decision on Appeal From High Court Summary Dismissal of Writ Petition Challenging Labour Court Award

Legal Issues

  1. 1 Whether the principle of dividing monthly wages by 26 for calculation of retrenchment compensation under Section 25-F(b) of the Industrial Disputes Act, 1947 applies to a monthly-rated workman
  2. 2 What is the proper method to calculate 'average pay' for retrenchment compensation under Section 25-F(b) for a monthly-paid workman

Ratio Decidendi

For a monthly paid workman, 'average pay' as used in Section 25-F(b) of the Industrial Disputes Act, 1947 is to be calculated as the average wages for the previous three complete calendar months divided by three. The principle of dividing monthly wages by twenty-six working days, which applies under the Payment of Gratuity Act (after statutory amendment), does not apply under the Industrial Disputes Act, since no such amendment has been made. Therefore, the compensation paid by the University was in full compliance with Section 25-F(b).

Court Disposition

Appeal allowed

Orders

  • High Court judgment dated 21.3.2005 set aside
  • Labour Court award dated 9.11.2004 set aside