TMI Blog1980 (11) TMI 165X X X X Extracts X X X X X X X X Extracts X X X X ..... not manufacture any product or carry on trade. Its work force consists of engineers and supervisors and different categories of workmen. Out of 665 employees at Bombay, the draftsmen and the administrative staff number 306. These workmen are members of the Tata Consultant Employees Union. They served a Charter of Demands in July, 1974, on the appellant, and as their demands were not accepted and conciliation proceedings proved fruitless, the State Government made a reference of the dispute under s. 10(1) (d), Industrial Tribunal, Maharashtra for adjudication. The Reference was numbered I. T. No. 292 of 1975. The Union filed a statement before the Tribunal claiming an upward revision of the wage scales and dearness allowance and an increase from fifteen years to twenty years in the span for earning annual increments. It was urged that the Efficiency Bar, as a feature of the wage scales, should be removed. The dearness allowance, it was claimed, should be granted on a slab system. The claim of the Union was resisted by the appellant, who maintained that the existing wage scales were fair and reasonable on a region-cum- industry basis and that it would not be possible for the appel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ad no functional integrality with the other divisions. Having regard to the net profits earned by the appellant from 1968 to 1977 it found that the acceptance of the demands of the Union would result in an increased burden of Rs. 7 crores, a burden which would dry up the appellant's resources and would be impossible for it to bear. The Union modified its demands but even the modified terms, according to the Tribunal, appeared to be on the high side inasmuch as the resulting total burden of Rs. 1.70 crores was much higher than the average profits could sustain. The particular character of the appellant, that it was a service industry and not a manufacturing concern, was taken into account and it was observed that unlike a manufacturing business there was little scope for diversification in the case of an engineering consultancy. Nonetheless, the Tribunal observed, there was every reason to expect that the appellant would be able to earn sound profits in the future, and the instability in its business activities occasioned by the turbulent political situation in Iran, would be, it was expected, compensated by contracts secured in different developing countries. For the purpos ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Rs. 450-20-550-25- Typist/Jr. Steno 20-625-EB-25-725. 800-EB-30-950. Tel. Optr./Recep-tionist/Assist. Record Keeper/ Veh. Mechanic/ Jr. Librarian. IV Sr. Clerk/Steno/ Rs. 450-20-530-EB- Rs. 550-25-675-30- Record Keeper/ 30-860-EB-35-1000. 975-EB-40-1175. Tlx. Operator/ Xerox Operator V Office Asstt./ Rs. 590-30-740-EB- Rs. 690-35-865-40- Lib. Asstt./ 35-1020-EB-40-1300 1265-EB-45-1490. Cost. Assist./ Administrative Assist./Personnel Asstt./Comm. Asstt./ Canteen Asstt. VI Draughtsman/Site Rs. 380-30-620-40- Rs. 530-40-730-50- Supervisor/ 1020-EB-50-1320. 1230-EB-60-1530. Surveyor/(Diploma Holder). VII Junior Architect Rs. 760-40-1000-50- Rs. 860-50-1160-(Engineering 1300. -60-1700. Graduate) VIII Sr. Draughtsman Rs. 1000-50-1300- Rs. 1100-60-1340- (Diploma Holder) 60-1600-75-1750. 70-1690-80-2010. The Tribunal maintained the existing schemes of dearness allowance and house rent allowance, and observed that in view of the revised basic wages there would be a resultant increase in the dearness allowance and house rent allowance. The revised wage scales, the Tribunal directed, should take effect retrospectively from 1st January, 1976. It also laid down t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evised wage scales, and the other is the flat increase given to each employee of Rs. 150/- in the category of Draughtsmen and Rs. 100/- in other categories resulting from the order dated 22nd December, 1978. The workmen have filed an appeal by special leave, Civil Appeal No. 2300 of 1979, in which they have challenged the rejection by the Tribunal of their claim in respect of dearness allowance which, they contend, should be pegged to the cost of living index and should not be a fixed amount. Considering the appeal of Tata Consulting Engineers first, the contention of learned counsel for the appellant is that having regard to the financial capacity of the appellant the Tribunal erred in making the wage scales retrospective and, in any event, in ranging the retrospectivity back to 1st January, 1976. We have been taken through some of the material on the record in the attempt to support the contention, but after giving careful thought to the matter, I think there is ample justification for what the Tribunal did. It must be remembered that although the wage scales were introduced as long ago as 1973 they were maintained at that level except for a slight revision some time ther ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n of the conscious adjudication on the issues involved. Is the instant case one where the amendment made by the Tribunal in the original award can be said to correct a mere clerical mistake or error arising from an accidental slip or omission? To answer the question, it is necessary to examine the basis of the award and the intent which flows from that basis. The terms of reference in the State Government's order required the Tribunal to revise the scales of pay and dearness allowance, and there was no mention of giving any ad hoc increase in the basic pay of individual workman. It would do well to recall that the claim of the Union filed before the Tribunal also centered on the need to revise the wage scales. That was the main issue between the parties. It is to the task of revising the pay scales that the Tribunal addressed itself, and throughout the material part of the award it is that task which held its focussed attention. The financial capacity of the appellant, and the related study of its annual profits from 1968 to 1977, were examined from that view point. The sufficiency of the existing pay scales was considered in detail, and regard was had to their original stru ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rest. There will be no explanation why the initial start of the revised pay scales has been increased by Rs. 150/- in the case of the category of Draughtsmen and Rs. 100/- in the case of other categories. Considering the fitment of the workman in the revised scales, it was stated in the award that a workman found drawing a salary less than the beginning of the grade would be stepped up to the beginning of the grade and if his pay fell between two steps in the reclassified pay scales the basic pay was to be fixed at the step higher in the revised scale. Conspicuous by its absence is any reference to a flat increase in the pay of an individual workmen. Even when considering the range of permissible retrospectivity the Tribunal stated in the award: In view of the revision of the wage scales, there would be consequent increase in the dearness allowance and the house rent allowance. And the clinching circumstances of all is that the award was made on the basis that the overall financial load according to paragraph 33 of the award would be to the tune of about Rs. 5 lakhs. It was that figure which the Tribunal had in mind against the backdrop of the gross annual figures w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was prepared on the basis of the employees' strength as in December, 1971. A similar statement was prepared on the basis of the employees' strength as in September, 1978. These statements cannot be regarded as evidence that the appellant was cognizant of the intention of the Tribunal to provide a flat increase to the pay of each workman. The statement afforded an indication merely of what the additional financial load would be if a flat increase was given to the individual workman on the alternative basis set forth therein. None of the alternatives was actually adopted by the Tribunal, because when the award was made the Tribunal proceeded instead to restructure the wage scales by the addition of Rs. 150/- in the case of the category of Draughtsmen and Rs. 100/- in the case of other categories to the initial pay in the wage scales pertaining to those categories. The addition was integrated as a feature of the wage scales; it was not regarded as an addition to the pay of each individual workman. It seems that the Tribunal was betrayed by a curious confusion in accepting the plea of the Union that a flat increase to the pay of each workman was intended in the original wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... granted by the appellant at 10% of the salary subject to a minimum of Rs. 50/- and house rent allowance at 30% of the basic salary. Having regard to the not inconsiderable improvement in the level of the basic wage, it observed that there would be a consequent increase in the dearness allowance and house rent allowance. In view of the increase so secured, the Tribunal rejected the suggestion that a slab system should be introduced in the dearness allowance or that there should be any other modification of the principle on which dearness allowance was being presently granted. It declared that the cumulative effect of an improved wage structure together with dearness allowance operating on a slab system would throw an impossible burden of about Rs. 1 crore on the financial capacity of the appellant. It was open to the Tribunal to adopt the position which it did. If the dearness allowance is linked with the cost of living index the whole award will have to be reopened and the entire basis on which it has been made will have to be reconsidered. The award is a composite document in which the several elements of increased wage scales, larger increments, longer span of 20 years for earn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to revise the existing scheme of Dearness Allowance'. Further, it appears that the Tribunal intended to grant the increase of Rs. 150/- to each draughtsman and Rs. 100/- to all other workmen in their basic pay. However, this is not clearly mentioned anywhere in the award due to accidental slip or omission. The Union therefore prays the honourable Tribunal to clarify the position and correct the award accordingly . On this application, the Advocate for the employer company made the following endorsement: Submitted to whatever this Hon'ble Tribunal desires to do . Thereafter the Tribunal made an order on the same day in the following terms: There can be no doubt that a flat increase of Rs. 150/- to each of the employees in the category of Draftsmen and of Rs. 100/- to each employee in the other categories has been granted under my award. The same has been made clear in paragraph No. 23, but it appears that the words to each employee after the figure Rs. 150/- were omitted. Similarly, the same words to each employee after the figure 100 were omitted. When the award is sent for publication, a necessary corrigendum be made in the award and the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erial placed before it came to the conclusion that the company was in an undoubted position to bear the additional financial burden. At the end of paragraph 15 of the Award, the Tribunal stated: But there can be no doubt that the company can very well bear the additional burden. The question is what should be the extent of such burden? At the end of paragraph 18 of the award the Tribunal said: A mere reading of Exhibit U-15 will immediately dispel the misgivings about the future of the present company. For some years to come this is likely to be one of the few Consulting Engineers who will be securing major contracts . Again in Paragraph 19 it was said: I have no doubt that the present Company would be able to bear the additional burden for the years to come. This is further borne out from the trading results of the Company for the year 1968-69 to 1977. The profits have increased all along. The copy of the letter dated July 23, 1973, alongwith the Annexures from the Company to the Director General, Posts Telegraphs, Delhi (Ex. C-27) indicates the important projects the Company was handling in India and abroad, and the amount of foreign exchange earned and repatriated. I will; ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the junior employees would get a large benefit. While workmen raising industrial disputes for revision of wage-scales are certainly minded about their future prospects in the matter of wages, they, surely would be more concerned with the immediate benefits according to them That was why the Industrial Tribunal thought that an all round flat increase of Rs. 150/- in the case of Draftsmen and Rs. 100/- in the case of other workmen was called for. It was clearly so intended by the Tribunal as is evident from the reference to flat increase of Rs. 150/- in the category of Draftsmen and Rs. 100/- in the case of the other categories . Since there was to be a flat increase of Rs. 150/- and Rs. 100/- in the case of draftsmen and other workmen respectively, the revised wage scale had necessarily to commence with figures Rs. 150/- and Rs. 100/- above the existing wage scales. Immediately after the award was pronounced, while the iron was still hot as it were, the employees apparently realised that the employer might take advantage of the circumstance that it was not clearly mentioned in the award that all the employees were to get additional pay of Rs. 150/- and Rs. 100/- respecti ..... X X X X Extracts X X X X X X X X Extracts X X X X
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