Mahanadi Coalfields Ltd. vs. Brajrajnagar Coal Mines Workers' Union [March 12, 2024]
Background
This Supreme Court case arose from a long-standing dispute over the regularization of 13 contract workers employed by Mahanadi Coalfields Ltd. (MCL), a subsidiary of Coal India Ltd. The workers, initially engaged through a contractor between 1984 and 1994, performed tasks such as coal handling and railway siding work—duties also assigned to regular employees. The Brajrajnagar Coal Mines Workers’ Union sought permanent status for all 32 such workers. In a 1997 settlement, only 19 were regularized, while MCL claimed the remaining 13 were “casual” workers.
Industrial Tribunal and High Court Findings
The Industrial Tribunal, after examining evidence and the nature of work, found that all 32 workers performed perennial and regular tasks, indistinguishable from those of regular employees. It held that the exclusion of 13 workers from regularization was arbitrary and unjustified. The Tribunal directed their regularization and awarded back wages from May 23, 2002, the date of its decision. The Orissa High Court upheld these findings, dismissing both the writ and review petitions filed by MCL.
Key Legal Issues
Whether the 13 excluded workers were entitled to regularization and back wages on parity with the 19 already regularized.
Whether the Tribunal could entertain the dispute despite a prior settlement under the Industrial Disputes Act, 1947.
Supreme Court’s Analysis
The Supreme Court, led by Justices Pamidighantam Sri Narasimha and Sandeep Mehta, affirmed the concurrent findings of the Tribunal and High Court:
The Court emphasized that, under the National Coal Wage Agreement-IV, contract labour cannot be engaged for “permanent and perennial” jobs; such work must be performed by regular employees.
Testimony from MCL’s own managers confirmed that the 13 workers undertook the same perennial tasks as those regularized.
The Court rejected MCL’s argument that the 1997 settlement precluded further regularization, holding that the settlement could not override statutory rights or perpetuate arbitrary exclusion.
The Supreme Court found the denial of regularization and employment to the 13 workers was wrongful and not attributable to any fault of the workmen.
Judgment
The Supreme Court dismissed MCL’s appeal, upholding the regularization of the 13 workers and awarding them back wages from May 23, 2002.
The Court clarified that there would be no restriction on the quantum of wages due, given the wrongful denial of employment.
The judgment sets a precedent for the rights of contract workers performing perennial work and reinforces the principle of parity in employment status for similarly situated workers.
Significance
The case strengthens protections for contract workers in India’s coal sector and beyond, ensuring that employers cannot arbitrarily deny regularization to workers performing permanent functions.
It affirms that settlements cannot be used to bypass statutory protections or create unjust distinctions among similarly placed employees.
Citation:
Mahanadi Coalfields Ltd. vs. Brajrajnagar Coal Mines Workers' Union, Supreme Court of India, Civil Appeal No(s). 4092-4093/2024, decided on March 12, 2024.
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