Customary Practice Of Requiring Suspended Employee To Mark His Attendance At Factory Gate Illegal: Bombay HC

The Bombay High Court held that a customary practice of requiring a suspended employee to mark his attendance is illegal.

The Court noted that the requirement of law is only that the suspended employee has to inform the employer that he is not gainfully employed elsewhere. 

The Court held thus in a writ petition preferred by M/s. Hindustan Level Employees Union against Hindustan Unilever Limited (HUL).

A Single Bench of Justice Milind N. Jadhav said, “… the question before me is whether such a customary practice of requiring the employee to mark his attendance at the factory gate without the support of any rule, regulation, standing order or statutory enactment is maintainable in the face of the statutory provision of Section 10(A) of the said Act. I am afraid it is not. The Respondent - Company cannot lay down and insist on a customary practice followed by the Company to prevail upon the existing statutory provisions of law. The argument of the Respondent - Company is difficult to accept. A customary practice cannot be equated as a provision under any law or a provision under any other law and the provisions of Section 10(A) of the said Act clearly supervene in relation to the payment of subsistence allowance over the alleged customary practice followed by the Respondent - Company.”

The Bench added that once it is found that the customary practice is in clear conflict with the provisions of Section 10(A) of the Industrial Employment (Standing Orders) Act, 1946 (IESO Act), the claim of the employee being entitled to subsistence allowance cannot be permitted to be defeated based on a customary practice followed by the company.

Advocate Jane Cox appeared on behalf of the petitioner- Union while Advocate Supriya Mujumdar appeared on behalf of the respondent- HUL/company.

Brief Facts -

The challenge in the writ petition was to the award rejecting the Reference which was related to the Union’s claim for seeking subsistence allowance being denied by the company on the ground that the suspended employee did not attend the factory premises to mark his attendance at the factory gate in the muster/register provided for the purpose during his suspension. Award held that denial of subsistence allowance is not contrary to law and justified, since the suspended employee did not attend the factory everyday and sign the muster/register.

As per the Union, it was not a requirement under the law requiring and/or to call upon a suspended employee to mark his physical attendance and sign the muster everyday at the factory gate as a pre-requisite for being paid subsistence allowance. However, such a decision of the company was upheld by the Labour Court. Hence, the matter was before the High Court.

The question for adjudication before the High Court was whether the act of the company is in consonance with the provisions of Section 10(A) of the IESO Act.

The High Court in view of the above question observed, “The Labour Court in the impugned Award in paragraph No.20 thereof has taken a parochial view of the aforementioned issue which was before it for adjudication. Once the Petitioner places on record its grievance for non-payment of subsistence allowance it cannot be held that no contention has been raised about the condition put by the employer that it is against the provisions of law. The findings given in paragraph No.20, that the evidence of the employee is silent about the provisions of law according to which the condition of attendance at the gate of the factory everyday during the period of suspension is illegal cannot be sustained.”

The Court further noted that any condition put by the employer and more specifically a condition directly relating to entitlement of subsistence allowance must be within the parameters and four corners of Section 10(A) of the said Act only. It added that the condition stipulated by the company is an illegal one which is contrary to the said provision.

“It is an unfair, unjust and malafide condition which is contrary to the provisions of Section 10(A) of the said Act. What is required under the law is for the suspended employee to inform the employer that he is not gainfully employed elsewhere and nothing more. Once the statutory provisions does not provide for requiring marking of attendance everyday such introduction of a stipulation as per customary practice is illegal in law, no matter what the concerned employer desire from introducing such a condition”, it said.

Accordingly, the High Court allowed the petition, quashed the impugned award, and directed the company to pay the entire amount along with interest to the suspended employee within one week.

Cause Title- M/s. Hindustan Level Employees Union v. M/s. Hindustan Unilever Limited (Neutral Citation: 2024:BHC-AS:282)

Click here to read/download the Judgment