Retrenchment Case: Validity of the retrenchment challenged under Chapter 5B of the ID Act.
As on 28th April, 2004, 85 regular workmen were employed in the factory. 48 of them were retrenched basis LIFO on 29th April, 2004. Other temporaries and casuals were not considered in this calculation of total workmen under Chapter 5B. This is the point of contention from the union and they want retrenchment to be deemed illegal.
Conciliation proceedings ensued and a meeting was held with DLC. Our lawyer, covered up the issue. But the union was not satisfied and conciliation proceedings failed. Hence the matter was referred to the labour court. This was the point where 48 were involved. (May 2004)
Re-employment was offered on temperory basis for an order Dec 2005 @ 75% of their last drawn wages. Agreement signed with union in Form H. After the order was fore closed by the customer on 10th March, 2006, they were asked to stop reporting to work. They refused to leave the premises and Gherao and the plant had to be shut down for 10 days. Temp lock out declared. Retrenched people approached the ALC and were directed to the DLC. DLC asked both parties to pursue the proceeding in the court as the matter was still pending before the labour court. Same DLC, unofficially, had a meeting with Union and Management and helped come up with the VRS scheme. DLC acted in good faith on his personal visit and VRS scheme was outcome of oral negotiation with the Union, Management and the DLC. The worked out scheme was 45 days wages for every year of service and one time payment of Rs. 1000.
14 out of the 48 people opted for this scheme in July 2006. Later on small batches came in to avail the VRS scheme and finally 22 people opted for the same as on March 2007
The remaining 26 people were again called back for re-employment on temporary basis for another order on 11th July, 2007. They refused to accept the re-employment offer demanding permanent employment as against the temporary employment provided for the particular order.
26 people were still contesting the cases in the court. In March 2008, during negotiation with the union, one time payment was increased to Rs. 15000. This time 16 people availed the scheme on 31st March, 2008
Finally, 10 remained. They are still fighting the case. The case is in cross-examination stage.
Negotiation efforts at right intervals were carried out. First through the Union leaders and then on a one-on-one basis with the HR Manager. It has been amply communicated to them about the condition of the company and how it is in their best interest to take the settlement. The negotiations were in a dead lock.
During end of July, another scheme was worked out for the remaining 10 where they were offered approximately Rs. 40,000/- as one time payment. This worked out to be roughly 50% higher than the total settlement amount previously offered. Extensive interactions and negotiation efforts have not been successful. They are demanding a very high compensation of Rs. 3-5 Lacs or re-instatement.
This a case that we are currently contesting in the court. Kindly give your inputs.
From India, Bangalore
As on 28th April, 2004, 85 regular workmen were employed in the factory. 48 of them were retrenched basis LIFO on 29th April, 2004. Other temporaries and casuals were not considered in this calculation of total workmen under Chapter 5B. This is the point of contention from the union and they want retrenchment to be deemed illegal.
Conciliation proceedings ensued and a meeting was held with DLC. Our lawyer, covered up the issue. But the union was not satisfied and conciliation proceedings failed. Hence the matter was referred to the labour court. This was the point where 48 were involved. (May 2004)
Re-employment was offered on temperory basis for an order Dec 2005 @ 75% of their last drawn wages. Agreement signed with union in Form H. After the order was fore closed by the customer on 10th March, 2006, they were asked to stop reporting to work. They refused to leave the premises and Gherao and the plant had to be shut down for 10 days. Temp lock out declared. Retrenched people approached the ALC and were directed to the DLC. DLC asked both parties to pursue the proceeding in the court as the matter was still pending before the labour court. Same DLC, unofficially, had a meeting with Union and Management and helped come up with the VRS scheme. DLC acted in good faith on his personal visit and VRS scheme was outcome of oral negotiation with the Union, Management and the DLC. The worked out scheme was 45 days wages for every year of service and one time payment of Rs. 1000.
14 out of the 48 people opted for this scheme in July 2006. Later on small batches came in to avail the VRS scheme and finally 22 people opted for the same as on March 2007
The remaining 26 people were again called back for re-employment on temporary basis for another order on 11th July, 2007. They refused to accept the re-employment offer demanding permanent employment as against the temporary employment provided for the particular order.
26 people were still contesting the cases in the court. In March 2008, during negotiation with the union, one time payment was increased to Rs. 15000. This time 16 people availed the scheme on 31st March, 2008
Finally, 10 remained. They are still fighting the case. The case is in cross-examination stage.
Negotiation efforts at right intervals were carried out. First through the Union leaders and then on a one-on-one basis with the HR Manager. It has been amply communicated to them about the condition of the company and how it is in their best interest to take the settlement. The negotiations were in a dead lock.
During end of July, another scheme was worked out for the remaining 10 where they were offered approximately Rs. 40,000/- as one time payment. This worked out to be roughly 50% higher than the total settlement amount previously offered. Extensive interactions and negotiation efforts have not been successful. They are demanding a very high compensation of Rs. 3-5 Lacs or re-instatement.
This a case that we are currently contesting in the court. Kindly give your inputs.
From India, Bangalore
First of all I presume you represent the employer and not the employee(s)
Secondly, the length of service of these 10 employees and their last drawn salaries are not available from the post. Similarly, their remaining years of service with your company also have a direct bearing on the amount of settlement.
For an average workman drawing a minimum rate of wages with a length of 10 years of service will get an amount more than Rs 40000 in case he is discharged. Because, by settlement means a sum payable all inclusive of gratuity and retrenchment compensation.
Regards,
Madhu.T.K
From India, Kannur
4249Secondly, the length of service of these 10 employees and their last drawn salaries are not available from the post. Similarly, their remaining years of service with your company also have a direct bearing on the amount of settlement.
For an average workman drawing a minimum rate of wages with a length of 10 years of service will get an amount more than Rs 40000 in case he is discharged. Because, by settlement means a sum payable all inclusive of gratuity and retrenchment compensation.
Regards,
Madhu.T.K
From India, Kannur
Some of the observations which are listed as below:
1. It is mentioned "As on" which means they are retrenched within a day, if it would have been "As of" , it makes more sense
2. Re-employment on a temporary basis where offer was @75% of last drawn salary is more than the Act offered
From India, Bengaluru
1. It is mentioned "As on" which means they are retrenched within a day, if it would have been "As of" , it makes more sense
2. Re-employment on a temporary basis where offer was @75% of last drawn salary is more than the Act offered
From India, Bengaluru
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