The Supreme Court held that the State cannot keep temporary employees in insecure service conditions while assigning them duties identical to permanent staff. It ruled that workers performing the same functions cannot be denied corresponding benefits and social security protections.
The Supreme Court held that the State, as an employer, cannot continue to retain a workforce performing the same duties as permanent staff while denying them corresponding benefits.
A Bench of Justices Sanjay Karol and A.G. Masih set aside an order of the Patna High Court that had rejected pensionary benefits for temporary employees who had served for decades in the Department of Posts.
The top court observed that any classification that results in denial of benefits to a group of employees who are otherwise similarly situated in respect of duties and responsibilities would violate the constitutional ethos.
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The Bench said the court has consistently held that long-serving employees whether casual or temporary particularly those granted recognized status, cannot be denied corresponding benefits, including social security and pensionary entitlements.
It said,
“The emphasis must be on ensuring that the State does not retain such employees in a precarious condition while extracting services identical to those performed by regular employees,”
The Bench directed the Centre to calculate and release, within three months, the pensionary and consequential retiral benefits due to a group of former employees, or the legal representatives of those employees, who had rendered long years of service in the Department of Posts as casual labourers (Night Guards).
It further stated that in the event of default, interest at the rate of six per cent per annum would be payable from the date the benefits accrued until the amount is disbursed.
Noting that despite granting temporary status and extending benefits comparable to those available to Group ‘D’ employees, the employees concerned were never formally regularized in service due largely to administrative inaction on the part of the Department of Posts, the court said such an approach could not be justified.
The Bench referenced the Directive Principles of State Policy especially Articles 38, 39 and 43 stating they impose a positive obligation on the State to secure social and economic justice, fair working conditions, and a decent standard of living for labourers. It said pension, in this context, is not a matter of grace, but part of social welfare and economic justice.
The court emphasized that treating the State as a model employer, read together with these constitutional mandates, reinforces the State’s duty to provide fair and equitable treatment to employees who have rendered long and continuous service and that the State cannot seek services of a permanent nature while withholding corresponding benefits.
Referring to a 2013 judgment that held pension to be a hard-earned benefit earned through long and continuous service, and in the nature of property under Article 300A of the Constitution, the top court highlighted,
“At this stage, it is also necessary to note that pension is not a bounty but a vested and enforceable constitutional right,”
It said once pension is recognized as a constitutional right in the nature of property, it cannot be withdrawn except by authority of law.
The top court said,
“A statutory right cannot be rendered illusory on account of inaction of the employer, and such inaction cannot defeat or deny a constitutional right.”
The court added,
“It is in the light of this above discussed judicial approach of this court over a period of time, the provisions of the Scheme and the subsequent applicable circulars must be read, understood and interpreted,”
The Bench said the Department of Posts had framed the 1991 Scheme for integrating casual labourers into the structured service framework, with progressive extension of service benefits to such employees, ultimately leading to their regularisation.
It added that Clause 2 of the Scheme provides that casual labourers, once conferred temporary status, shall be paid wages on the basis of the minimum of the pay scale applicable to regular Group ‘D’ employees, along with Dearness Allowance, House Rent Allowance and City Compensatory Allowance.
The Bench stated that the grant of pay and other service-related benefits made it clear that the Scheme aimed to move casual labourers away from a purely casual/daily-rated arrangement and progressively align their service conditions with those of regular employees.
It further said a cumulative reading of the Scheme shows it was designed as a beneficial and progressive framework to gradually extend Group ‘D’-level service conditions and benefits to casual labourers with temporary status.
It said the Scheme cannot be interpreted in any manner that would restrict or defeat its objective of assimilating casual labourers with regular staff.
In view of the foregoing discussion and findings recorded hereinabove, we are of the considered opinion that the impugned judgments passed by the High Court proceeded on an erroneous interpretation of the Scheme and the circular dated November 30, 1992.