The Hindu : National : ``Reinstated staff can't claim back wages''

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Friday, Feb 10, 2006

National

National

``Reinstated staff can't claim back wages''

Legal Correspondent

Supreme Court Bench sets aside Andhra Pradesh High Court order on similar case

New Delhi: The Supreme Court has held that retrenched employees reinstated in service pursuant to a tribunal or a court order are not entitled to claim payment of back wages as a matter of right for the period when they were out of employment.

A Bench of Justice Arijit Pasayat and Justice R.V. Raveendran held that several factors had to be considered to find out if an employee was entitled to back wages and to what extent. It held that when reinstatement was directed payment of back wages was not the natural consequence.

Writing the judgment, Mr. Justice Pasayat cited an earlier ruling and said: "To state that merely upon reinstatement, a workman would be entitled, under the terms of the award, to all his arrears of pay and allowances would be incorrect because several factors will have to be considered to find out whether the workman is entitled to back wages at all."

The Bench was of the view that when the Labour Court passed an award for reinstatement without any reference to payment of back wages, the High Court sitting on appeal over the award could not presume that "back wages is implied in the award of reinstatement or that the award of reinstatement itself conferred right for claim of back wages." The Bench set aside an order of the Andhra Pradesh High Court, which had affirmed a Labour Court award directing the Andhra Pradesh State Road Transport Corporation (APSRTC) to pay arrears of wages to some employees who were reinstated after their termination from service was held illegal.

Points out difference

The Bench pointed that there was a difference between a reinstatement order with a simple direction for continuity of service and a direction where reinstatement was accompanied by a specific direction that the employee should be entitled to all the consequential benefits.

The Bench further said, "When a question arises as to the adjudication of a claim for back wages all relevant circumstances which will have to be gone into, are to be considered in a judicious manner. If, after the termination of employment, the workman is gainfully employed elsewhere it is one of the factors to be considered in determining whether or not reinstatement should be with full back wages or with continuity of employment."

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