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P.B. SAWANT, J. – These appeals have been referred to the Constitution Bench in view of
the apparent conflict of opinions expressed in three decisions of this Court – a three-Judge
Bench decision in Churakulam Tea Estate (P) Ltd. v. Workmen [AIR 1969 SC 998] and a
two-Judge Bench decision in Crompton Greaves Ltd. v. Workmen [(1978) 3 SCC 155] on the
one hand, and a two-Judge Bench decision in Bank of India v. T.S. Kelawala [(1990) 4 SCC
744] on the other. The question is whether workmen who proceed on strike, whether legal or
illegal, are entitled to wages for the period of strike? In the first two cases, viz., Churakulam
Tea Estate and Crompton Greaves, the view taken is that the strike must be both legal and
justified to entitle the workmen to the wages for the period of strike whereas the latter
decision in T.S. Kelawala has taken the view that whether the strike is legal or illegal, the
employees are not entitled to wages for the period of strike. To keep the record straight, it
must be mentioned at the very outset that in the latter case, viz., T.S. Kelawala the question
whether the strike was justified or not, was not raised and, therefore, the further question
whether the employees were entitled to wages if the strike is justified, was neither discussed
nor answered. Secondly, the first two decisions, viz., Churakulam Tea Estate and Crompton
Greaves were not cited at the Bar while deciding the said case and hence there was no
occasion to consider the said decisions there. The decisions were not cited probably because
the question of the justifiability or otherwise of the strike did not fall for consideration. It is,
however, apparent from the earlier two decisions, viz., Churakulam Tea Estate and
Crompton Greaves that the view taken there is not that the employees are entitled to wages
for the strike period merely because the strike is legal. The view is that for such entitlement
the strike has both to be legal and justified. In other words, if the strike is illegal but justified
or if the strike is legal but unjustified, the employees would not be entitled to the wages for
the strike period. Since the question whether the employees are entitled to wages, if the strike
is justified, did not fall for consideration in the latter case, viz., in T.S. Kelawala, there is, as
stated in the beginning, only an apparent conflict in the decisions.
CA No. 2710 of 1991:
- On 10-4-1989 a memorandum of settlement was signed by the Indian Banks’
Association and the All Indian Bank Employees’ Unions including the National
Confederation of Bank Employees as the fifth bipartite settlement. The appellant-Bank and
the respondent-State Bank Staff Union through their respective federations were bound by the
said settlement. In terms of clauses 8(d) and 25 of the memorandum of the said settlement, the
appellant-Bank and the respondent-Staff Union had to discuss and settle certain service
conditions. Pursuant to these discussions, three settlements were entered into between the
parties on 9-6-1989. These settlements were under Section 2(p) read with Section 18(1) of the
Industrial Disputes Act, 1947 (the ‘Act’). Under these settlements, the employees of the
appellant-Bank were entitled to certain advantages over and above those provided under the
All India Bipartite Settlement of 10-4-1989. The said benefits were to be given to the
employees retrospectively with effect from 1-11-1989. It appears that the appellant-Bank did
not immediately implement the said settlement. Hence, the employees’ Federation sent telex
143
message to the appellant-Bank on 22-6-1989 calling upon it to implement the same without
further loss of time. The message also stated that the employees would be compelled to
launch agitation for implementation of the settlement as a consequence of which the working
of the Bank and the service to the customers would be affected. In response to this, the Bank
in its reply dated 27-6-1989 stated that it was required to obtain the Government’s approval
for granting the said extra benefits and that it was making efforts to obtain the Government’s
approval as soon as possible. Hence the employees’ Federation should, in the meanwhile, bear
it with. On 24-7-1989 the Employees’ Federation again requested the Bank by telex of even
date to implement the said settlement forthwith, this time, warning the Bank that in case of its
failure to do so, the employees would observe a day’s token strike after 8-8-1989. The Bank’s
response to this message was the same as on the earlier occasion. On 18-8-1989, the
employees’ Federation wrote to the Bank that the settlements signed were without any
precondition that they were to be cleared by the Government and hence the Bank should
implement the settlement without awaiting the Government’s permission. The Federation
also, on the same day, wrote to the Bank calling its attention to the provisions of Rule 58.4 of
the Industrial Disputes (Central) Rules, 1957 (the ‘Rules’) and requesting it to forthwith
forward copies of the settlements to the functionaries mentioned in the said rule. By its reply
of 23-8-1989 the Bank once again repeated its earlier stand that the Bank is required to obtain
Government’s approval for granting the said extra benefits and it was vigorously pursuing the
matter with the Government for the purpose. It also informed the Federation that the
Government was actively considering the proposal and an amicable solution would soon be
reached and made a request to the employees’ Federation to exercise restraint and bear with it
so that their efforts with the Government may not be adversely affected. By another letter of
the same date, the Bank informed the Federation that they would forward copies of the
agreements in question to the authorities concerned as soon as the Government’s approval
regarding implementation of the agreement was received. The Federation by the letter of 1-9-
1989 complained to the Bank that the Bank had been indifferent in complying with the
requirements of the said Rule 58.4 and hence the Federation itself had sent copies of the
settlements to the authorities concerned, as required by the said rule. - On the same day, i.e., 1-9-1989 the Federation issued a notice of strike demanding
immediate implementation of all agreements/ understandings reached between the parties on
10-4-1989 and 9-6-1989 and the payment of arrears of pay and allowances pursuant to them.
As per the notice, the strike was proposed to be held on three different days beginning from
18-9-1989. At this stage, the Deputy Chief Labour Commissioner and Conciliation Officer
(Central), Bombay wrote both to the Bank and the Federation stating that he had received
information that the workmen in the Bank through the employees’ Federation had given a
strike call for 18-9-1989. No formal strike notice in terms of Section 22 of the Act had,
however, been received by him. He further informed that he would be holding conciliation
proceedings under Section 12 of the Act in the office of the Regional Labour Commissioner,
Bombay on 14-9-1989 and requested both to make it convenient to attend the same along with
a statement of the case in terms of Rule 41(a) of the Rules. - The conciliation proceedings were held on 14-9-1989 and thereafter on 23-9-1989. On
the latter date, the employees’ Federation categorically stated that no dispute as such existed.
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The question was only of implementation of the agreements/understandings reached between
the parties on 10-4-1989 and 9-6-1989. However, the Federation agreed to desist from direct
action if the Bank would give in writing that within a fixed time they will implement the
agreements/understandings and pay the arrears of wages etc. under them. The Bank’s
representatives stated that the Bank had to obtain prior approval of the Government for
implementation of the settlements and as they were the matters with the Government for
obtaining its concurrence, the employees should not resort to strike in the larger interests of
the community. He also pleaded for some more time to examine the feasibility of resolving
the matter satisfactorily. The conciliation proceedings were thereafter adjourned to 26-9-1989.
On this date, the Bank’s representatives informed that the Government’s approval had not till
then been obtained, and prayed for time till 15-10-1989. The next meeting was held on 27-9- - The Conciliation Officer found that there was no meeting ground and no settlement
could be arrived at. However, he kept the conciliation proceedings alive by stating that in
order to explore the possibility of bringing about an understanding in the matter, he would
further hold discussions on 6-10-1989. - On 1-10-1989, the Employees’ Federation gave another notice of strike stating that the
employees would strike work on 16-10-1989 to protest against the inaction of the Bank in
implementing the said agreements/settlements validly arrived at between the parties. In the
meeting held on 6-10-1989, the Conciliation Officer discussed the notice of strike. It appears
that in the meanwhile on 3-10-1989 the employees’ Federation had filed Writ Petition No.
13764 of 1989 in the High Court for a writ of mandamus to the Bank to implement the three
settlements dated 9-6-1989. In that petition, the Federation had obtained an order of interim
injunction on 6-10-1989 restraining the Bank from giving effect to the earlier settlement dated
10-4-1989 and directing it first to implement the settlements dated 9-6-1989. It appears
further that the employees had in the meanwhile, disrupted normal work in the Bank and had
resorted to gherao. The Bank brought these facts, viz., filing of the writ petition and the
interim order passed therein as well as the disruption of the normal work and resort to gheraos
by the employees, to the notice of the Conciliation Officer. The meeting before the
Conciliation Officer which was fixed on 13-10-1989 was adjourned to 17-10-1989 on which
date, it was found that there was no progress in the situation. It was on this date that the
employees’ Federation gave a letter to the Conciliation Officer requesting him to treat the
conciliation proceedings as closed. However, even thereafter, the Conciliation Officer decided
to keep the conciliation proceedings open to explore the possibility of resolving the matter
amicably. - On 12-10-1989 the Bank issued a circular stating therein that if the employees went
ahead with the strike on 16-10-1989, the Management of the Bank would take necessary steps
to safeguard the interests of the Bank and would deduct the salary for the days the employees
would be on strike, on the principle of “no work, no pay”. In spite of the circular, the
employees went on strike on 16-10-1989 and filed a writ petition on 7-11-1989 to quash the
circular of 12-10-1989 and to direct the Bank not to make any deduction of salary for the day
of the strike.
145 - The said writ petition was admitted on 8-11-1989 and an interim injunction was given
by the High Court restraining the Bank from deducting the salary of the employees for 16-10-
1989. - Before the High Court, it was not disputed that the Bank was a public utility service
and as such Section 22 of the Act applied. It was the contention of the Bank that since under
the provisions of sub-section (1)(d) of the said Section 22, the employees were prohibited
from resorting to strike during the pendency of the conciliation proceedings and for seven
days after the conclusion of such proceedings, and since admittedly the conciliation
proceedings were pending to resolve an industrial dispute between the parties, the strike in
question was illegal. The industrial dispute had arisen because while the Bank was required to
take the approval of the Central Government for the settlements in question, the contention of
the employees was that no such approval was necessary and there was no such condition
incorporated in the settlements. This being an industrial dispute within the meaning of the
Act, the conciliation proceedings were validly pending on the date of the strike. As against
this, the contention on behalf of the employees was that there could be no valid conciliation
proceedings as there was no industrial dispute. The settlements were already arrived at
between the parties solemnly and there could be no further industrial dispute with regard to
their implementation. Hence, the conciliation proceedings were non est. The provisions of
Section 22(1)(d) did not, therefore, come into play. - The learned Single Judge upheld the contention of the Bank and held that the strike
was illegal, and relying upon the decision of this Court in T.S. Kelawala case dismissed the
writ petition of the employees upholding the circular under which the deduction of wages for
the day of the strike was ordered. Against the said decision, the employees’ Federation
preferred Letters Patent Appeal before the Division Bench of the High Court and the Division
Bench by its impugned judgment reversed the decision of the learned Single Judge by
accepting the contention of the employees and negativing that of the Bank. The Division
Bench, in substance, held that the approval of the Central Government as a condition
precedent to their implementation was not incorporated in the settlements nor was such
approval necessary. Hence, there was no valid industrial dispute for which the conciliation
proceedings could be held. Since the conciliation proceedings were invalid, the provisions of
Section 22(1)(d) did not apply. The strike was, therefore, not illegal. The Court also held that
the strike was, in the circumstances, justified since it was the Bank Management’s unjustified
attitude in not implementing the settlements, which was responsible for the strike. The Bench
then relied upon two decisions of this Court in Churakulam Tea Estate and Crompton
Greaves cases and held that since the strike was legal and justified, no deduction of wages for
the strike day could be made from the salaries of the employees. The Bench thus allowed the
appeal and quashed the circular of the 12-10-1989. - Since the matter has been referred to the larger bench on account of the seeming
difference of opinion expressed in T.S. Kelawala and the earlier decisions in Churakulam
Tea Estate and Crompton Greaves, we will first discuss the facts and the view taken in the
earlier two decisions. - In Churakulam Tea Estate which is a decision of three learned Judges, the facts were
that the appellant-Tea Estate which was a member of the Planter’s Association of Kerala
146
(South India), from time to time since 1946, used to enter into agreements with the
representatives of the workmen, for payment of bonus. In respect of the years 1957, 1958 and
1959, there was a settlement dated 25-1-1960 between the Managements of the various
plantations and their workers relating to payment of bonus. The agreement provided that it
would not apply to the appellant-Tea Estate since it had not earned any profit during the said
years. On the ground that it was not a party to the agreement in question, the appellant
declined to pay any bonus for the said three years. The workmen started agitation claiming
bonus. The conciliation proceedings in that regard failed. All 27 workers in the appellant’s
factory struck work on the afternoon of 30-11-1961. The Management declined to pay wages
for the day of the strike to the said factory workers. The Management also laid off without
compensation all the workers of the estate from 1-12-1961 to 8-12-1961. By its order dated
24-5-1962, the State Government referred to the Industrial Tribunal three questions for
adjudication one of which was whether the factory workmen were entitled to wages for the
day of the strike. - The Tribunal took the view that the strike was both legal and justified and hence
directed the appellant to pay wages. This Court noted that at the relevant time, conciliation
proceedings relating to the claim for bonus had failed and the question of referring the dispute
for adjudication to the Tribunal was under consideration of the Government. The Labour
Minister had called for a conference of the representatives of the Management and workmen
and the conference had been fixed on 23-11-1961. The representatives of the workmen
attended the conference, while the Management boycotted the same. It was the case of the
workmen that it was to protest against the recalcitrant attitude of the Management in not
attending the conference that the workers had gone on strike from 1 p.m. on the day in
question. On behalf of the Management, the provisions of Section 23(a) of the Act were
pressed into service to contend that the strike resorted to by the factory workers was illegal.
The said provisions read as follows: - No workman who is employed in any industrial establishment shall go on strike in
breach of contract and no employer of any such workman shall declare a lockout –
(a) during the pendency of conciliation proceedings before a Board and seven
days after the conclusion of such proceedings;
This Court noted that there were no conciliation proceedings pending on 30-11-1961
when the factory workers resorted to strike and hence the strike was not hit by the aforesaid
provision. The Court further observed that if the strike was hit by Section 23(a), it would be
illegal under Section 24(1)(i) of the Act. Since, however, it was not so hit, it followed that the
strike in this case could not be considered to be illegal. We may quote the exact observations
of the Court which are as follows:
Admittedly there were no conciliation proceedings pending before such a Board
on 30-11-1961, the day on which the factory workers went on strike and hence the
strike does not come under Section 23(a). No doubt if the strike, in this case, is hit by
Section 23(a), it will be illegal under Section 24(1)(i) of the Act; but we have already
held that it does not come under Section 23(a) of the Act. It follows that the strike, in
this case, cannot be considered to be illegal.
147
Alternatively, it was contended on behalf of the Management that in any event, the strike in
question was thoroughly unjustified. It was the Management’s case that it had participated in
the conciliation proceedings and when those proceedings failed, the question of referring the
dispute was pending before the Government. The workmen could have made a request to the
Government to refer the dispute for adjudication and, therefore, the strike could not be
justified. Support for this was also sought by the Management from the observations made by
this Court in Chandramalai Estate, Ernakulam v. Workmen [AIR 1960 SC 902]. In that
case, this Court had deprecated the conduct of workmen going on strike without waiting for a
reasonable time to know the result of the report of the Conciliation Officer. This Court held
that the said decision did not support the Management since the strike was not directly in
connection with the demand for bonus but was as a protest against the unreasonable attitude
of the Management in boycotting the conference held on 23-11-1961 by the Labour Minister
of the State. Hence, this Court held that the strike was not unjustified. In view of the fact that
there was no breach of Section 23(a) and in view also of the fact that in the aforesaid
circumstances, the strike was not unjustified, the Court held that the factory workers were
entitled for wages for that day and the Tribunal’s award in that behalf was justified. - In Crompton Greaves Ltd. the facts were that on 27-12-1967, the appellantManagement intimated the workers’ Union its decision to reduce the strength of the workmen
in its branch at Calcutta on the ground of severe recession in business. Apprehending mass
retrenchment of the workmen, the Union sought the intervention of the Minister in charge of
Labour and the Labour Commissioner, in the matter. Thereupon, the Assistant Labour
Commissioner arranged a joint conference of the representatives of the Union and of the
Company in his office, with a view to explore the avenues for an amicable settlement. Two
conferences were accordingly held on 5-1-1968 and 9-1-1968 in which both the parties
participated. As a result of these conferences, the Company agreed to hold talks with the
representatives of the Union at its Calcutta office on the morning of 10-1-1968. The talk did
take place but no agreement could be arrived at. The Assistant Labour Commissioner
continued to use his good offices to bring about an amicable settlement through another joint
conference which was scheduled for 12-1-1968. On the afternoon of 10-1-1968, the Company
without informing the Labour Commissioner that it was proceeding to implement its proposed
scheme of retrenchment, put up a notice of retrenching 93 of the workmen in its Calcutta
Office. Treating this step as a serious one demanding urgent attention and immediate action,
the workmen resorted to strike w.e.f. 11-1-1968 after giving notice to the appellant and the
Labour Directorate and continued the same up to 26-6-1968. In the meantime, the industrial
dispute in relation to the retrenchment of the workmen was referred by the State Government
to the Industrial Tribunal on 1-3-1968. By a subsequent order dated 13-12-1968, the State
Government also referred the issue of the workmen’s entitlement to wages for the strike
period, for adjudication to the Industrial Tribunal. The Industrial Tribunal accepted the
workmen’s demand for wages for the period from 11-1-1968 to the end of February 1968 but
rejected their demand for the remaining period of the strike observing that “the redress for
retrenchment having been sought by the Union itself through the Tribunal, there remained no
justification for the workmen to continue the strike”.
148 - In the appeal filed by the Management against the award of the Tribunal in this Court,
the only question that fell for determination was whether the award of the Tribunal granting
the striking workmen wages for the period from 11-1-1968 to 29-2-1968 was valid. In
paragraph 4 of the judgment, this Court observed as follows: - It is well settled that in order to entitle the workmen to wages for the period of
strike, the strike should be legal as well as justified. A strike is legal if it does not
violate any provision of the statute. Again, a strike cannot be said to be unjustified
unless the reasons for it are entirely perverse or unreasonable. Whether a particular
strike was justified or not is a question of fact which has to be judged in the light of
the facts and circumstances of each case. It is also well settled that the use of force or
violence or acts of sabotage resorted to by the workmen during a strike disentitles
them to wages for the strike period.
After observing thus, the Court formulated the following two questions, viz., (1) whether the
strike in question was illegal or unjustified? and (2) whether the workmen resorted to force or
violence during the said period, that is, 11-1-1968 to 29-2-1968. While answering the first
question, the Court pointed out that no specific provision of law has been brought to its notice
which rendered the strike illegal during the period under consideration. The strike could also
not be said to be unjustified as before the conclusion of the talks for conciliation which were
going on through the instrumentality of the Assistant Labour Commissioner, the Company
had retrenched as many as 93 of its workmen without even intimating the Labour
Commissioner that it was carrying out its proposed plan of effecting retrenchment of the
workmen. Hence, the Court answered the first question in the negative. In other words, the
Court held that the strike was neither illegal nor unjustified. On the second question also, the
Court held that there was no cogent and disinterested evidence to substantiate the charge that
the striking workmen had resorted to force or violence. That was also the finding of the
Tribunal and hence the Court held that the wages for the strike period could not be denied to
the workmen on that ground as well. - It will thus be apparent from this decision that on the facts, it was established that
there was neither a violation of a provision of any statute to render the strike illegal nor in the
circumstances it could be held that the strike was unjustified. On the other hand, it was the
Management, by taking a precipitatory action while the conciliation proceedings were still
pending, which had given a cause to the workmen to go on strike. - In Kairbetta Estate, Kotagiri v. Rajamanickam [AIR 1960 SC 893], this Court
observed as follows:
Just as a strike is a weapon available to the employees for enforcing their
industrial demands, a lockout is a weapon available to the employer to persuade by a
coercive process the employees to see his point of view and to accept his demands. In
the struggle between capital and labour, the weapon of strike is available to labour
and is often used by it, so is the weapon of lockout available to the employer and can
be used by him. The use of both the weapons by the respective parties must,
however, be subject to the relevant provisions of the Act. Chapter V which deals with
149
strikes and lockouts clearly brings out the antithesis between the two weapons and
the limitations subject to which both of them must be exercised. - In Chandramalai Estate the facts were that on 9-8-1955, the workers’ Union
submitted to the Management a charter of fifteen demands. Though the Management agreed
to fulfil some of the demands, the principal demands remained unsatisfied. On 29-8-1955, the
Labour Officer, Trichur, who had in the meantime been apprised of the situation both by the
Management and the workers’ Union, advised mutual negotiations between the
representatives of the Management and the workers. Ultimately, the matter was recommended
by the Labour Officer to the Conciliation Officer, Trichur for conciliation. The Conciliation
Officer’s efforts proved in vain. The last meeting for conciliation was held on 30-11-1955. On
the following day, the Union gave a strike notice and the workmen went on strike w.e.f. 9-12- - The strike ended on 5-1-1956. Prior to this, on 5-1-1956, the Government had referred
the dispute with regard to five of the demands for adjudication to the Industrial Tribunal,
Trivandrum. Thereafter, by its order dated 11-6-1956, the dispute was withdrawn from the
Trivandrum Tribunal and referred to the Industrial Tribunal, Ernakulam. By its award dated
19-10-1957, the Tribunal granted all the demands of the workmen. The appeal before this
Court was filed by the Management on three of the demands. One of the issues was: “Are the
workers entitled to get wages for the period of the strike?”. On this issue, before the Tribunal,
the workmen had pleaded that the strike was justified while the Management contended that
strike was both illegal and unjustified. The Tribunal had recorded a finding that both the
parties were to blame for the strike and ordered the Management to pay the workers 50% of
their total emoluments for the strike period. - This Court while dealing with the said question held that it was clear that on 30-11-
1955, the Union knew that the conciliation attempts had failed and the next step would be the
report by the Conciliation Officer to the Government. It would, therefore, have been proper
and reasonable for the workers’ Union to address the Government and request that a reference
be made to the Industrial Tribunal. The Union did not choose to wait and after giving notice
to the Management on 1-12-1955 that it had decided to strike work from 9-12-1955, actually
started the strike from that date. The Court also held that there was nothing in the nature of
the demands made by the Union to justify the hasty action. The Court then observed as under:
The main demands of the Union were about the cumbly allowance and the price of
rice. As regards the cumbly allowance they had said nothing since 1949 when it was
first stopped till the Union raised it on 9-8-1955. The grievance for collection of
excess price of rice was more recent but even so it was not of such an urgent nature
that the interests of labour would have suffered irreparably if the procedure
prescribed by law for settlement of such disputes through Industrial Tribunals was
resorted to. After all it is not the employer only who suffers if production is stopped
by strikes. While on the one hand it has to be remembered that strike is a legitimate
and sometimes unavoidable weapon in the hands of labour it is equally important to
remember that indiscriminate and hasty use of this weapon should not be encouraged.
It will not be right for labour to think that for any kind of demand a strike can be
commenced with impunity without exhausting reasonable avenues for peaceful
achievement of their objects. There may be cases where the demand is of such an
150
urgent and serious nature that it would not be reasonable to expect labour to wait till
after asking the Government to make a reference. In such cases, strike even before
such a request has been made may well be justified. The present is not however one
of such cases. In our opinion the workmen might well have waited for some time
after conciliation efforts failed before starting a strike and in the meantime to have
asked the Government to make a reference.
They did not wait at all. The conciliation efforts failed on 30-11-1955, and on the
very next day the Union made its decision on strike and sent the notice of the
intended strike from the 9-12-1955, and on the 9-12-1955, the workmen actually
struck work. The Government appear to have acted quickly and referred the dispute
on 3-1-1956. It was after this that the strike was called off. We are unable to see how
the strike in such circumstances could be held to be justified. - In India General Navigation and Railway Co. Ltd. v. Workmen [AIR 1960 SC 219],
this Court while dealing with the issues raised there, observed as follows:
In the first place, it is a little difficult to understand how a strike in respect of a
public utility service, which is clearly, illegal, could at the same time be characterised
as ‘perfectly justified’. These two conclusions cannot in law coexist. The law has
made a distinction between a strike which is illegal and one which is not, but it has
not made any distinction between an illegal strike which may be said to be justifiable
and one which is not justifiable. This distinction is not warranted by the Act, and is
wholly misconceived, specially in the case of employees in a public utility service.
Every one participating in an illegal strike, is liable to be dealt with departmentally,
of course, subject to the action of the Department being questioned before an
Industrial Tribunal, but it is not permissible to characterise an illegal strike as
justifiable. The only question of practical importance which may arise in the case of
an illegal strike, would be the kind or quantum of punishment, and that, of course,
has to be modulated in accordance with the facts and circumstances of each case.
Therefore, the tendency to condone what has been declared to be illegal by statute,
must be deprecated, and it must be clearly understood by those who take part in an
illegal strike that thereby they make themselves liable to be dealt with by their
employers. There may be reasons for distinguishing the case of those who may have
acted as mere dumb driven cattle from those who have taken an active part in
fomenting the trouble and instigating workmen to join such a strike, or have taken
recourse to violence. - We may now refer to the decision of this Court in the T.S. Kelawala case where
allegedly a different view has been taken from the one taken in the aforesaid earlier decisions
and in particular in Churakulam Tea Estate and Crompton Greaves cases. - The facts in the case were that some demands for wage revision made by the
employees of all the banks were pending at the relevant time and in support of the said
demands, the All India Bank Employees Association, gave a call for a countrywide strike.
The appellant-Bank issued a circular on 23-9-1977 to all its branch managers and agents to
deduct wages of the employees who participate in the strike for the days they go on strike.
151
The employees’ Union gave a call for a four-hour strike on 29-12-1977. Hence, the Bank on
27-12-1977 issued a circular warning the employees that they would be committing a breach
of their contract of service if they participated in the strike and that they would not be entitled
to draw the salary for the full day if they do so and consequently they need not report for
work for the rest of the working hours of that day. Notwithstanding it, the employees went on
four-hour strike from the beginning of the working hours on 29-12-1977. There was no
dispute that banking hours for the public covered the said four hours. The employees,
however, resumed work on that day after the strike hours and the Bank did not prevent them
from doing so. On 16-1-1978, the Bank issued a circular directing its managers and agents to
deduct the full day’s salary of those of the employees who had participated in the strike. The
employees’ union filed a writ petition in the High Court for quashing the circular. The
petition was allowed. The Bank’s Letters Patent Appeal in the High Court also came to be
dismissed. The Bank preferred an appeal against the said decision of the High Court. On these
facts, the only questions relevant for our present purpose which were raised in the case before
the High Court as well as in this Court were whether the Bank was entitled to deduct wages of
workmen for the period of strike and further whether the Bank was entitled to deduct wages
for the whole day or pro rata only for the hours for which the employees had struck work.
The incidental questions were whether the contract of employment was divisible and whether
when the service rules and the regulations did not provide for deduction of wages, the Bank
could do so by an administrative circular. We are not concerned with the incidental questions
in this case. What is necessary to remember is the question whether the strike was legal or
illegal and whether it was justified or unjustified was not raised either before the High Court
or in this Court. The only question debated was whether, even assuming that the strike was
legal, the Bank was entitled to deduct wages as it purported to do under the circular in
question. It is while answering this question that this Court held that the legality or illegality
of the strike had nothing to do with the liability for the deduction of the wages. Even if the
strike is legal, it does not save the workers from losing the salary for the period of the strike.
It only saves them from disciplinary action, since the Act impliedly recognises the right to
strike as a legitimate weapon in the hands of the workmen. However, this weapon is
circumscribed by the provisions of the Act and the striking of work in contravention of the
said provisions makes it illegal. The illegal strike is a misconduct which invites disciplinary
action while the legal strike does not do so. However, both legal as well as illegal strike invite
deduction of wages on the principle that whoever voluntarily refrains from doing work when
it is offered to him, is not entitled for payment for work he has not done. In other words, the
Court upheld the dictum “no work no pay”. Since it was not the case of the employees that the
strike was justified, neither arguments were advanced on that basis nor were the aforesaid
earlier decisions cited before the Court. - There is, therefore, nothing in the decisions of this Court in Churakulam Tea Estate
and Crompton Greaves cases or the other earlier decisions cited above which is contrary to
the view taken in T.S. Kelawala. What is held in the said decisions is that to entitle the
workmen to the wages for the strike period, the strike has both to be legal and justified. In
other words, if the strike is only legal but not justified or if the strike is illegal though
justified, the workers are not entitled to the wages for the strike period. In fact, in India
General Navigation case the Court has taken the view that a strike which is illegal cannot at
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the same time be justifiable. According to that view, in all cases of illegal strike, the employer
is entitled to deduct wages for the period of strike and also to take disciplinary action. This is
particularly so in public utility services. - We, therefore, hold endorsing the view taken in T.S. Kelawala that the workers are
not entitled to wages for the strike period even if the strike is legal. To be entitled to the
wages for the strike period, the strike has to be both legal and justified. Whether the strike is
legal or justified are questions of fact to be decided on the evidence on record. Under the Act,
the question has to be decided by the industrial adjudicator, it being an industrial dispute
within the meaning of the Act. - In the present case the High Court, relying on Churakulam Tea Estate and Crompton
Greaves cases has held that the strike was both legal and justified. It was legal according to
the High Court because the reference to the conciliation proceedings was itself illegal and,
therefore, in the eye of the law, no conciliation proceedings were pending when the
employees struck work. The strike was, further justified according to the High Court because
the Bank had taken a recalcitrant attitude and had insisted upon obtaining the approval of the
Central Government for the implementation of the agreements in question, when no such
approval was either stipulated in the agreements or required by law. We are afraid that the
High Court has exceeded its jurisdiction in recording the said findings. It is the industrial
adjudicator who had the primary jurisdiction to give its findings on both the said issues.
Whether the strike was legal or illegal and justified or unjustified, were issues which fell for
decision within the exclusive domain of the industrial adjudicator under the Act and it was not
primarily for the High Court to give its findings on the said issues. The said issues had to be
decided by taking the necessary evidence on the subject. We find nothing in the decision of
the High Court to enlighten us as to whether notwithstanding the fact that the agreements in
question had not stipulated that their implementation was dependent upon the approval of the
Central Government; in fact, the Bank was not duty-bound in law to take such approval. If it
was obligatory for the Bank to do so, then it mattered very little whether the agreements in
question incorporated such a stipulation or not. If the approval was necessary, then there did
exist a valid industrial dispute between the parties and the conciliation proceedings could not
be said to be illegal. It must be noted in this connection that the said agreements provided for
benefits over and above the benefits which were available to the employees of the other
Banks. Admittedly, the employees struck work when the conciliation proceedings were still
pending. Further, the question whether the implementation of the said agreements was of such
an urgent nature as could not have waited the outcome of the conciliation proceedings and if
necessary, of the adjudication proceedings under the Act, was also a matter which had to be
decided by the industrial adjudicator to determine the justifiability or unjustifiability of the
strike. - It has to be remembered in this connection that a strike may be illegal if it contravenes
the provisions of Sections 22, 23 or 24 of the Act or of any other law or of the terms of
employment depending upon the facts of each case. Similarly, a strike may be justified or
unjustified depending upon several factors such as the service conditions of the workmen, the
nature of demands of the workmen, the cause which led to the strike, the urgency of the cause
or the demands of the workmen, the reason for not resorting to the dispute resolving
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machinery provided by the Act or the contract of employment or the service rules and
regulations etc. An enquiry into these issues is essentially an enquiry into the facts which in
some cases may require taking of oral and documentary evidence. Hence such an enquiry has
to be conducted by the machinery which is primarily invested with the jurisdiction and duty to
investigate and resolve the dispute. The machinery has to come to its findings on the said
issue by examining all the pros and cons of the dispute as any other dispute between the
employer and the employee. - Shri Garg appearing for the employees did not dispute the proposition of law that
notwithstanding the fact that the strike is legal, unless it is justified, the employees cannot
claim wages for the strike period. However, he contended that on the facts of the present case,
the strike was both legal and justified. We do not propose to decide the said issues since the
proper forum for the decision on the said issues in the present case is the adjudicator under the
Act. - The strike as a weapon was evolved by the workers as a form of direct action during
their long struggle with the employers. It is essentially a weapon of last resort being an
abnormal aspect of the employer-employee relationship and involves withdrawal of labour
disrupting production, services and the running of the enterprise. It is abuse by the labour of
their economic power to bring the employer to see and meet their viewpoint over the dispute
between them. In addition to the total cessation of work, it takes various forms such as
working to rule, go slow, refusal to work overtime when it is compulsory and a part of the
contract of employment, “irritation strike” or staying at work but deliberately doing
everything wrong, “running-sore strike”, i.e., disobeying the lawful orders, sit-down, stay-in
and lie-down strike etc. etc. The cessation or stoppage of works whether by the employees or
by the employer is detrimental to the production and economy and to the well-being of the
society as a whole. It is for this reason that the industrial legislation while not denying the
right of workmen to strike, has tried to regulate it along with the right of the employer to
lockout and has also provided a machinery for peaceful investigation, settlement, arbitration
and adjudication of the disputes between them. Where such industrial legislation is not
applicable, the contract of employment and the service rules and regulations many times,
provide for a suitable machinery for resolution of the disputes. When the law or the contract
of employment or the service rules provide for a machinery to resolve the dispute, resort to
strike or lockout as a direct action is prima facie unjustified. This is, particularly so when the
provisions of the law or of the contract or of the service rules in that behalf are breached. For
then, the action is also illegal. - The question whether a strike or lockout is legal or illegal does not present much
difficulty for resolution since all that is required to be examined to answer the question is
whether there has been a breach of the relevant provisions. However, whether the action is
justified or unjustified has to be examined by taking into consideration various factors some
of which are indicated earlier. In almost all such cases, the prominent question that arises is
whether the dispute was of such a nature that its solution could not brook delay and await
resolution by the mechanism provided under the law or the contract or the service rules. The
strike or lockout is not to be resorted to because the party concerned has a superior bargaining
power or the requisite economic muscle to compel the other party to accept its demand. Such
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indiscriminate use of power is nothing but assertion of the rule of “might is right”. Its
consequences are lawlessness, anarchy and chaos in the economic activities which are most
vital and fundamental to the survival of the society. Such action, when the legal machinery is
available to resolve the dispute, may be hard to justify. This will be particularly so when it is
resorted to by the section of the society which can well await the resolution of the dispute by
the machinery provided for the same. The strike or lockout as a weapon has to be used
sparingly for redressal of urgent and pressing grievances when no means are available or
when available means have failed, to resolve it. It has to be resorted to, to compel the other
party to the dispute to see the justness of the demand. It is not to be utilised to work hardship
to the society at large so as to strengthen the bargaining power. It is for this reason that
industrial legislation such as the Act places additional restrictions on strikes and lockouts in
public utility services. - With the emergence of the organised labour, particularly in public undertakings and
public utility services, the old balance of economic power between the management and the
workmen has undergone a qualitative change in such undertakings. Today, the organised
labour in these institutions has acquired even the power of holding the society at large to
ransom, by withholding labour and thereby compelling the managements to give in on their
demands whether reasonable or unreasonable. What is forgotten many times, is that as against
the employment and the service conditions available to the organised labour in these
undertakings, there are millions who are either unemployed, underemployed or employed on
less than statutorily minimum remuneration. The employment that workmen get and the
profits that the employers earn are both generated by the utilisation of the resources of the
society in one form or the other whether it is land, water, electricity or money which flows
either as share capital, loans from financial institutions or subsidies and exemptions from the
Governments. The resources are to be used for the well-being of all by generating more
employment and production and ensuring equitable distribution. They are not meant to be
used for providing employment, better service conditions and profits only for some. In this
task, both the capital and the labour are to act as the trustees of the said resources on behalf of
the society and use them as such. They are not to be wasted or frittered away by strikes and
lockouts. Every dispute between the employer and the employee has, therefore, to take into
consideration the third dimension, viz., the interests of the society as a whole, particularly the
interest of those who are deprived of their legitimate basic economic rights and are more
unfortunate than those in employment and management. The justness or otherwise of the
action of the employer or the employee has, therefore, to be examined also on the anvil of the
interests of the society which such action tends to affect. This is true of the action in both
public and private sector. But more imperatively so in the public sector. The management in
the public sector is not the capitalist and the labour an exploited lot. Both are paid employees
and owe their existence to the direct investment of public funds. Both are expected to
represent public interests directly and have to promote them. - We are, therefore, more than satisfied that the High Court in the present case had
erred in recording its findings on both the counts viz., the legality and justifiability, by
assuming jurisdiction which was properly vested in the industrial adjudicator. The impugned
order of the High Court has, therefore, to be set aside.
155 - Hence we allow the appeal. Since the dispute has been pending since 1989, by
exercising our power under Article 142 of the Constitution, we direct the Central Government
to refer the dispute with regard to the deduction of wages for adjudication to the appropriate
authority under the Act within eight weeks from today. The appeal is allowed accordingly
with no order as to costs.
CA No. 2689 of 1989 and CA Nos. 2690-92 of 1989 : - In these two matters, arising out of a common judgment of the High Court, the
question involved was materially different, viz., whether when the employees struck work
only for some hours of the day, their salary for the whole day could be deducted. As in the
case of T.S. Kelawala, in this case also the question whether the strike was justified or not
was not raised. No argument has also been advanced on behalf of the employees before us on
the said issue. In the circumstances, the law laid down by this Court in T.S. Kelawala, with
which we concur, will be applicable. The wages of the employees for the whole day in
question, i.e., 29-12-1977 are liable to be deducted. The appeals are, therefore, allowed and
the impugned decision of the High Court is set aside. There will, however, be no order as to
costs.
