WORKMEN OF WILLIAMSON MAGOR & CO. LTD. versus WILLIAMSON MAGOR & CO. LTD. & ANR.

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WORKMEN OF WILLIAMSON MAGOR &CO. LTD.

v.

WILLIAMSON MAGOR & CO. LTD. & ANR.

December 7, 1981

(V.D. TULZAPURKAR, BAHARUL ISLAM AND

A. V ARADARAJAN, JJ.)

Industrial Disputes Act 1947 Ss JO and 15.

Management granting promotion to junior employees-Rightful claim of senior employees superseded-Industrial dispute-Whether there is victimization-Jwis· diction and duty of industrial tribunal to declare promotions illegal and unjusti fied-ln consultation with management and union frame norms and rules for promotion.

Labour Law-Promotion-Whether a managerial function-Whether to be on

subjective satisfaction of management or on some objective criteria.

Words & Pharases-' Victimisation'-Meaning of-Interpretation in favour

of labour whether to be accepted.

The Workmen (Respondent No. I) alleged that the Management (Appel· lant) started giving indiscriminate and arbitrary promotions and/or u1>gradations to some of the employees who were its favourities, disregarding the rightful claims of a number of other employees so much so that even junior members were given promotions superseding the rightful claims of the senior employees. According to the Union, the management arbitrarily promoted/upgraded three persons and unjustly denied promotion/upgradation to twelve senior employees and that this was victimisation and unfair labour practice, and that these three persons after their promotion/upgradation used to do the same work as before occupying the same chairs and working on the same tables as they had done before the date of upg,rndation/promotion.

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the issue

As a dispute arose between

the management and the union, the State Government referred the Industrial Tribunal for adjudication. During the pendency of the reference before the Tribunal the management again promoted from the General to the Special Grade two clerks supet >eding 56 senior and efficient clerks of the General Grade. This issue was also referred to the Industrial Tribunal.

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The Tribunal, on a consideration of the oral and documentary evidence adduced beforo it, found that the management did not care to establish the

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WORKMEN v. WILLIAMSON MAGOR & co.

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justification of the promotions of the persons named in the two references superseding the claim of the others, but held that it could not give any relief to the workmen when their positive case was that there was no standard or norms for giving promotion.

In the appeal to this Court it was contended on behalf of the Manage- ment that : (I) Promotion is not a condition of service in a private company, and (2) although there were no norms, the promotions of the persons in ques- tion were not arbitrary and that unless victimisation was proved by the union, the management's action should not be disturbed.

Allowing the appeal

HELD : 1. (i) The management, in consultation with the workmen or their representatives and under the direction, supervision and control of the Labour Commissioner shall frame norms/rules fixing quota for the grades and for promotion/upgradation of its workmen, and the upgradation and/or pro motion shall be made by the management in terms of the norms/rules so framed. [51 D-E]

That meanwhile the promotions/upgradations of the three persons which is the subject matter of the first reference and the promotions/upgradations of the two persons which is the subject matter of the second reference are can celled and these workmen shall be at par with the workmen who were super seded till promotions/upgradations are made by the management in terms of the norms/rules to be prepared. No future promotions/upgradations shall be made until the norms/rules are framed. [51 F-52 A]

(ii)

Industrial Tribunals are inten<jed to adjudicate

industrial disputes between the management and the workmen, settle them and pass effective that industrial peace between the employers and the awards in such a way employees may be maintained so that there can be more production to benefit all concerned. For this purpose the industrial tribunals, should not be constrained by the formal rules of law and should avoid inability to arrive at an effective award to meet justice in a particular dispute. [48 F-G]

In the instant case there was victimisation of the superseded workmen. The Tribunal should have, therefore declared that the promotions were illegal and unjustified, being the result of arbitrary action of the management which was nothing but unfair labour practice and the promotions should have been cancelled. It should also have in consultation with the management and the union framed norms/rules of promotion and directed the management to give promotions/upgradations in accordance with those norms and rules. (48 H-49 A]

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2.

(i) Although promotion/upgradation

it must not be on the subjective satisfaction of the management but must be on some objective criteria. [ 49 E]

is a managerial function

(ii) The normal meaning of 'Victimisation' is being the victim of unfair interpreted in two labour should be

and arbitrary action. When the word 'victimisation' can be different ways, the interpretation which is in favour of the

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accepted as they are the poorer section of the people as compared to the management. [50 G, DJ

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Bharat Bank Ltd. v. Employees of Bharat Bank Ltd. [1950] S.C.R. 459: K.C.P. Employees Association Madras v. Management of K.C.P. Ltd. Madras & Ors. [1978] 2 SCC 42 referred to.

CIVIL APPELLATE JURISDICTION : Civil Appeal Nos. 351 &

352 of 1976

Appeals by special leave from the A ward dated the 31st May, 1975 of the Seventh Industrial Tribunal, West Bengal, Publi shed by the Government of West Bengal, Labour DepartJ11ent in Reference Case No. VIII-39/74, G.0. No. 3278-IR dt. 2.4.1974. & VIII-282/74, GO No. 7537-IR dated 10.12.1974.

D. L. Gupta S. K. Nandi

and Krishna Prasad for the

Appellant.

G. B. Pai, N. C. Shah, J. R. Das and Parveen Kumar for the

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Respodent.

The Judgment of the Court was delivered by

BAHARUL IsLAM, J. These two connected appeals by special leave are on behalf of Workmen of M/s Williamson Magor & Co. Ltd. (renamed as M/s Macneill & Magor Ltd.) represented by Willi.amson Magor & Company Employees' Union (hereinafter called 'the union') and are directed against the award of the 7th Industrial Tribunal, West Bengal.

2. The material facts may be stated thus :

According to the union, all the employees of the aforesaid company, the respondent before us (who will hereinafter be called 'the management') are the members of the union. Disputes had arisen between the workmen and the management but they ended in a number of agreements as a result whereof the employees derived some benefits. Subsequently the management appointed one Mr. P. K. Kaul as a staff officer, who, according to the union, started to create a cleavage between the workmen, and with that end in view, at his instance, the management started giving indis criminate and arbitrary promotions and/or upgradations to some of the employees who were its favourites, disregarding the right ful claims of a number of other employees so much so that even

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WORkMEN v. WiLLiAMSON MAGOR &. co. (Baharul Islam, J.

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junior members were given promotions superseding the rightful claims of the senior employees. The union took up the cause of the workmen with the management. According to the union, there is no norm and/or standard guiding promotion and/or upgradatioµ of the employees. According to the union, the action of the management is arbitrary, ma/a fide and intended to victimize the employees who are loyal to the union.

At the material

time there were two grades of employees namely; Special Grade, with a higher scale of pay and General Grade.

3. This

is an admitted position that the management do not have any norm to determine how many clerks should be in each of the said grades or in each of the scales of pay; nor is there any fixed quota in the Special Grade to be filled up by pro motion from the General Grade; nor is there any rule determining the number of vacancies to be filled up by promotion or upgra dation. According to the union, the normal rule should be promotion/upgradation by seniority. As this was not done, unrest cropped up. On the management having upgraded/promoted two junior clerks, namely; Anil Chandra Ghose and Parameshwar Banerjee from General Grade to Special Grade on 1.3.1972, super seding the claims of senior clerks, without assigning any reason, the union protested. Far from rectifying the unjust action, the management again promoted/upgraded another person, Shri Saroj Mukherjee to Special Grade on l.7.1972, superseding the claims of many others who were senior to him. According to the union, the management arbitrarily promoted/upgraded the aforesaid three twelve persons and unjustly denied promotion/upgradation senior clerks. This was, accordirig to the union, victimization and unfair labour practice. According to the aforesaid three favoured clerks and the twelve superseded clerks were doing promoted/upgraded persons exactly similar work. The three after their promotion/upgradation used to do the same work as be fore, occupying the same chairs and working on the same tables the date of upgradation/promotion. as they had done before According to the union, there were no jobs related to grades or scales of pay, and the promotion upgradation has no impact except mere increase of pay consequent upon the higher scale of pay given to each person promoted. As a dispute arose between the management and the union. the Government of West Bengal referred

the union,

to

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the following issue to the 7th Industrial Tribunal, West Bengal for adjudication :

"Whether promotion of Sharbasllree Saroj Kumar Mukharjee, Anil Chandra Ghose and Parmeshwar Banarjee from General Grade clerks to Special Grade Clerks in preference to the twelve (12) workmen marked in Annexure "A" attached herewith is justified ? To what relief, if any, are the workmen marked in Annexure "A" entitled ? The names of the persons in said Annexure "A" were the same as mentioned in paragraph 10 above".

4. During the pendency of the aforesaid reference before the Tribunal, the respondent on 23.5.1974 again promoted from the General to the Special Grade two clerks, namely Sudhir Ranjan Chakraborty and Jyoti Prasad Paul superseding 56 senior and efficient clerks of the General Grade inclusive of the twelve senior grade clerks already superseded in the reference, aforesaid. As a dispute arose, the Government of West Bengal made a reference to the same Industrial Tribunal for adjudi cation of the foll owing issue :

in 1972 and concerned

"Whether promotion of the workmen mentioned in Annexure "A" attached herewith from General Grade to Special Grade or Supervisory Grade in preference to the workmen metioned in Annexure "B" attached herewith is justified ?

To what relief, if any, are the workmen mentioned in

Annexure "B'' entitled ?"

5. Before the Tribunal, the parties led evidence and proved Exts. K-1 and K-2, settlements arrived at between the management of the union earlier. On a consideration of the oral and documen tribunal bas arrived at the tary evidence adduced before it, the following findings:-

(I) No agreed norm for promotion/upgradation was

formulated.

(2) Both the parties felt that it was desirable that certain norms should be laid do.wn for promoting and/or upgrading workmen.

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WORKMEN v. WILLIAMSON MAGOR & co. (Baharul Islam, J.) 47

(3) That in spite of the fact that no norm had been formulated, the management promoted as many as 15 workmen during the pendency of the first reference.

(4) That promotion and/or upgradalion is a mana gerial function and that the union can have no say in such matter. The Tribunal has found "it is now more or Jess the administra settled that the promotion/upgradation is tive function of the management and it can be hardly disputed before any court of law and/or tribunal unless it is proved that in effecting such promotion, the management violated the principles of natural justice and/or existing rules or norms". The Tribunal also has found, on a consi deration of the evidence of the management witness, Shri P. K. Kaul, that although the witness said that at the time of giving promotion, recommendations of the departmental heads and other authorities were taken into account, his evidence was not supported by any document. The tribunal has also found that although in terms of ear lier agreements, it was the duty of the management to investigate allegations by the union of discriminatory and unfair promotion and/or upgradation, the management did It further found that Ext. B disclosed that on not do so. 21.12.1972, the union demanded of the management investigation into the matter of the said discriminatory promotions but "curiously enough, there is nothing before me to show that the management did, in compliance with the said agreement, investigate into the matter as agreed upon."

is made. but even

(5) Ultimately the Tribunal held that the promotions of the three persons mentioned in the first reference "can not be justified because when it was agreed upon that investigate in case any comp the management would spite of the complaint in laint lodged by the union, the management did not investi gate." The Tribunal has even found that the manage ment did not care to establish the justification of the the aforesaid three persons superseding promotions of the claims of others.

(6) The Tribunal has also found, "it is not their (management's) case before me that, in fact, the manage-

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ment found those three persons suitable to the rest of the workmen.

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(7) Similarly, with regard to the second reference, the finding that "junior persoris the Tribunal came were given promotions superseding the claims of a number of senior workmen, but there is nothing before me from where I can say that the management was justi fied in giving promotion to them."

6. The above enumeration of the findings of the Tribunal clearly shows that the action of the management in promoting junior clerks of the General Grade superseding the claims of the senior clerks of the same Grade was arbitrary and unjustified. The Tribu nal has categoricalfy found, "I am constrained to observe that no material has been placed before me nor it has been claimed im evi dence that these people were more efficient and competent than the rest of the workmen.

that the management found

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the workmen

In the premises, I am bound to hold that I cannot justify the promotion of the said persons named in the two references and dispose of the first issue accondingly" (emphasis added). But to our amaze ment, it failed to pass any consequential order, and instead held, "I cannot give any relief to these workmen when their positive case In is that there is no standard or norms for giving promotion." the Tribunal categorically held that the other words, although actions of the management were unjustified, it expressed, its inabi lity to give any relief to the case. We do not think that the Tribunal should be so powerless. The industrial tribunals are intended to adjudicate industrial disputes between the management and the workmen, settle them, and pass effective awards in such a way that industrial peace between the employers and the employees may be maintained so that there can be more production to benefit all concerned. For the above purpose, the industrial tribunals, as far as practicable, should not be constrained by the formal rules of law and should avoid inability to arrive at an effec tive award to meet justice in a particular dispute. The Tribunal in the instant case, in view of its findings, first of all should have declared that the promotions of the aforesaid fifteen persons were illegal and unjustified, their promotions being the result of arbitrary action of the management which was nothing but unfair labour practice, and the promotions in question ~hoql<;! have been cancelled,

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WORKMEN v. wh:.LiAMSON MAGOR & co. (Baharui is/am, J.) 49

The Tribunal also, in our opinion, in consultation with the mana gement and the union, should have framed norms/rules of promo tions and directed the management to give promotions/upgradations in accordance with those norms/rules.

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7. We do not agree with the claim of the union tl~at promo tions or upgradations should be on the basi,s of Seniority. al9ne. The National Industrial Tribunal in its award gave the following wholesome directions:-

"I give the ge.neral formula wliich has been accepted by many concerns, namely, all things being equal, seniority shall coi.mt for promotion. If the senior person has beeri overlooked in the question of promoti.ori, he ls at liberty to ask the concern for reason why he has been overlooked, in which case the concern shall give him the reasons provi ded that it does not expose the concerti or the officer glving any reasons to any civil or criminal proceedings".

The management has failed to follow this direction in the case

in hand.

Although we agree that promotion/upgradation is a manage rial function, it must not be on the subjective satisfaction of the management but must be on some objective criteria,

8. Mr. ·Pai, 'learned counsel appearing for the management, made two submissfons before us. Firstly, he submitted that unlike in public sector iindettakings, promotion is not a condition of service in a private company. W'e are unable to accept the submis sion of Mr. Pai in toto. If there is no scope .of any promotion or up gradation or increase in salary in a private undertaking, the submi ssion of the learned counsel may be justified but if there are grades and scopes of upgradation/promotion and there are different scales of pay for different grades in a private undertaking, and, infact, promotion is given or upgradation is made, there should be no arbi trary or unjust and unreasonable upgradation or promotion of persons superseding ·the claims of persons who may be equally or even more, suitable. The second submission of Mr. Pai is that. al though there were no norms, the promotions of the persons in question were not arbitrary and that the linings of the Tribunal in this regard were incorrect. He I ed us through the material evidence

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ofthe witness examined. We are unable to agree with learned counsel and do not find any reason to differ from the findings of the learned Tribunal that the promotions of the fifteen persons were arbitrary and unjustified. Mr. Pai also submitted that unless victimi zation was proved by the union, the management's action should not be disturbed. The word 'victimization' has not been defineJ in the statue. The tetm was considered by this Court in the case of Bharat Bank Limited v. Employees of Bharat Bank Ltd.(1 ) This Court observed, "It (victimization) is an ordinary English word which means that a certain person has become a victim, in other words, that be has been unjustly dealt with". A submission was made on behalf of the management in that case that 'victimization' had acquired a special meaning in industrial disputes a:nd com10ted a person who became the victim of the employer's wrath by r<:ason of his trade union activities and that the word could not relate to a person who was merely unjustly dismissed". This submission, how ever, was not considered by the Court. When, however, the word 'victimization' can be interpreted in two different ways, the inter pretation which is in favour of the labour should be accepted as they are the poorer section of the people compared to the management.

This Court in the case of K. C. P. Employees' Association, Ltd. Madras & Ors.(2)

v. Management of K. C. P.

Madras observed

"In. Industrial Law, interpreted and applied in the per spective of Part IV of the Constitution, the benefit of reasonable doubt on law and facts, if there be such doubt, must go to the weaker section, labour. The Tribunal wll! dispose of the case making this compassionate approach but without over-stepping the proved facts".

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We would

therefore accept

the interpretation of the word 'victimization' in·the normal meaning of being the victim of unfair and arbitrary action, and hold that there was victimization of the superseded workmen.

9. Even if promotion may not be a condition of service in a private company and promotion may be the function of the manage-

. (I) [1950] SCR 459. (2) [19781 2 sec 42.

WORKMEN v. WILLIAMSON MAGOR & co. (Ba!wrul Islam, J.) 51

ment, it may be recognised that there may be occasions where the Tribunal may have to cancel the promotions made by the manage ment where it is felt that persons superseded have been so superseded on account of legal malafide or victimization (See 1966 (2) SCR 465). Although in spite of the allegations of rnala fide, the union has not been able to prove factual ma/a fide, in this case malice in law and effectual victimization are obvious due to the fact that un justified promotions of some junior persons were made superseding, without any reason or necessity, the cases of a large number of senior persons.

10. As a result of the foregoing considerations, we allow the appeals and, accepting the finding of the Tribunal, give the following directions :

(I) The management, in consultation with the workmen or their tepresentatives and under the direction, supervision and control of the Labour Commissioner of the region, shall frame norms/rules fixing quota for the grades and for promotion/upgradation of its workmen, in the light of the observations made above, within two months from the date of the receipt of a copy of this judgment by the Labour Commissioner.

(2) The upgradation and/or promotion shall be made by the

management in terms of the norms/rules so framed.

the subject matter of the

(3) That meanwhile the promotions/upgradations 0f Sharba and shree Saroj Kumar Mukherjee, Anil Chandra Gl10se Parameshwar Banerjee from General Grade to Special Grade clerks 'A', in preference to the twelve workmen mentioned in Annexure which is first reference, namely, No. 3278-IR/IR/l lL-13271 dated April 2, 1974, and the promo tions/upgradations of the persons mentioned in Annexure 'A' from the General Grade to Special Grade or Supervisor Grade in prefe· rence to the workmen mentioned in Annexure 'B', which is the subject niatter of the second reference, namely, Reference No. 7537- IR/IR/1 lL-132/71 dated December 10, 1974, are cancelled; and the workmen whose promotions are cancelled and the workmen who were superseded shall be at par wilh effect from the date of this judgment till promotions/upgradations are made by the management in terms of the norms/rules to be prepared; and no future promo-

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tions/upgradations framed. · '.

shall be made until the norms/rules are

11. T~e appeals are allmved with costs.

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12. Send a copy of this judgment to the Labour Commis-

sioner forthwith.

N. V. K.

Appeals allowed.

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