The Supreme Court declared that the government, as a constitutional employer, cannot act like a market player. It ruled that outsourcing cannot be misused to exploit workers or deny them fair engagement, regularization, and basic pay parity rights.
New Delhi: The Supreme Court ruled that public institutions cannot exploit workers through job outsourcing, denying long-term ad hoc employees regularization or basic pay parity by citing financial difficulties or a lack of vacancies.
A Bench of Justices Vikram Nath and Sandeep Mehta in a recent ruling, stated,
“Outsourcing cannot become a convenient shield to perpetuate precariousness and to sidestep fair engagement practices where the work is inherently perennial,”
Justice Nath emphasized that the state, referring to both the Union and State governments, is not merely a market participant but a constitutional employer. It cannot manage budgets at the expense of those performing essential and recurring public functions.
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He noted,
“Where work recurs day after day and year after year, the establishment must reflect that reality in its sanctioned strength and engagement practices,”
This judgment stemmed from an appeal by daily wage workers represented by advocate Sriram Parakkat, who approached the Supreme Court after the Uttar Pradesh Higher Education Services Commission denied their request for regularization, citing financial strain or a lack of vacancies.
Justice Nath remarked that the prolonged extraction of regular labor under temporary classifications undermines trust in public administration and violates the promise of equal protection.
The court stated while allowing the appeal,
“Financial stringency certainly has a place in public policy, but it is not a talisman that overrides fairness, reason and the duty to organise work on lawful lines,”
The court mandated that government departments maintain and produce accurate establishment registers, muster rolls, and outsourcing arrangements.
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They must also provide evidence explaining why they opted for precarious employment instead of sanctioned positions when work is perennial.
Justice Nath wrote,
“Ad hocism thrives where administration is opaque… Sensitivity to the human consequences of prolonged insecurity is not sentimentality. It is a constitutional discipline that should inform every decision affecting those who keep public offices running,”
The court pointed out that “administrative drift” and prolonged ad hoc employment exacerbate workplace insecurity.
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There must be clear duties, fixed timelines, and verifiable compliance.
The court emphasized,
“As a constitutional employer, the State is held to a higher standard and therefore it must organise its perennial workers on a sanctioned footing, create a budget for lawful engagement, and implement judicial directions in letter and spirit. Delay to follow these obligations is not mere negligence but rather it is a conscious method of denial that erodes livelihoods and dignity for these workers,”