Summary
Inter-factory transfers were supported by the employees’ appointment and confirmation terms. Even assuming deletion of the wider transfer clause from the standing orders, provisions governing transfers within a unit did not prohibit contractual transfers between company establishments. The 1999 modification had also been set aside on appeal and had not become operative under Sections 7 and 10(3). The Court overturned the Division Bench and the later contrary industrial award, while leaving the broader scope of certification and modification powers open.
Issues
- Whether intra-unit standing-order provisions conflicted with contractual inter-establishment transfer terms.
- Whether the challenged 1999 modification had become operative.
- Whether the Court needed to decide the broader statutory power to certify or modify transfer provisions.
Provisions considered
- Sections 7 and 10(3), Industrial Employment (Standing Orders) Act, 1946The statutory rules governing commencement apply to modifications as well as initial certification. Because the modification was appealed and set aside, it did not displace the operative 1989 standing orders. (¶¶ 18, 19, 20, 21, 22)
- Clauses 20 and 31, Certified Standing Orders of Divgi Metal Wares Ltd.The intra-unit transfer provision could coexist with contractual inter-establishment transfer rights, and clause 31 preserved rights under the service contract. The wider statutory authority to include such provisions was left open. (¶¶ 2.1, 2.2, 12, 13, 14, 16, 24)
Held
- Following Cipla Ltd. v. Jayakumar R., a standing-order clause regulating departmental, job or shift changes within a unit did not prohibit transfer to another company establishment under express appointment terms. Reading the provisions together disclosed no conflict. Here the appointment and confirmation terms expressly provided for transfers within the company and continued the contractual terms after transfer. (¶¶ 7, 8, 9, 10, 11, 12, 13, 14)
- Clause 31 additionally provided that the standing orders would not prejudice rights under the service contract, custom, usage, settlement or award. The contractual transfer stipulation therefore remained material even on the assumption that the wider words in clause 20 were removed. (¶¶ 2.2, 14)
- Sections 7 and 10(3) govern when modifications become operative. The Tribunal’s appellate order set aside the 1999 modification, so that modification had not come into effect. The 1989 standing orders governed both the transfers and the later award. The unsuccessful challenge to the original certification had not been pursued further. (¶¶ 2.4, 17, 18, 19, 20, 21, 22)
- The first Tribunal award had examined the evidence and found the transfers were not mala fide. The later award proceeded on the supposed operation of the modification without accounting for its appellate reversal. The Division Bench erred in disposing of the related writ petitions without discussing the Tribunal’s reasoning and in failing to apply the specifically cited Cipla decision. (¶¶ 15, 16, 17, 23)
- The broader questions concerning modification powers and the Certifying Officer’s authority to provide for nationwide transfers were expressly left open; their resolution was unnecessary to decide these contractual transfers. (¶¶ 7, 16, 24, 25)
- The Division Bench judgment was set aside, the union’s writ appeal and challenge to the earlier award dismissed, and the employer’s writ petition allowed. The Single Judge order was upheld and the 28 February 2006 award quashed. The appeals were disposed of without costs. (¶¶ 24, 26, 27)
Result
Appeals disposed of without costs in the employer’s favour. Division Bench judgment and 28 February 2006 Tribunal award set aside; union’s writ appeal and writ petition dismissed, employer’s writ petition allowed and Single Judge order upheld. Broader certification and modification powers left open.