Contractual Engagements Through Placement Agencies Do Not Create Vested Employment Rights In Workers: Rajasthan HC

The Court was hearing a bunch of Writ Petitions seeking directions to the respondents Jaipur Development Authority to reinstate the Petitioner back in services with all consequential benefits.

The bench of Justice Sameer Jain relied on the decision of the Apex Court in K.K. Suresh and Anr. vs. Food Corporation of India reported in AIR 2018 SC 3905, where it was held, “contractual engagement does not create a vested right of employment in favour of the workers, engaged through a placement agency.”

Advocate Prashant Sharma appeared for the Appellant and Advocate Amit Kuri appeared for the Respondent.

Upon reviewing the record, the Court found that the petitioners were appointed as contractual employees. However, they did not receive any appointment letters from the respondent-JDA specifying the terms and conditions of their engagement. The petitioners were merely third parties and not directly involved in the contract, which was between the respondent-JDA and respondent no.3-Contractor, who had engaged their services. The Court noted that the privity of contract existed solely between the respondent-JDA and the placement agency/contractor.

The Court further emphasised the settled position of the law regarding the negative scope of regularisation of contractual employees, by mentioning the recent Apex Court decision in Ganesh Digamber Jhambhrundkar and Ors. vs. State of Maharashtra and Ors.: Special Leave to Appeal No. 2543/2023, where according to the Court SC held that the fact of having rendered their services for a long time by contractual employees, shall not create a vested right of employment in their favour.

The Court went on to quote from the above-mentioned decision, “We appreciate the argument of the petitioners that they have given best part of their life for the said college but so far as law is concerned, we do not find their continuous working has created any legal right in their favour to be absorbed. In the event there was any scheme for such regularization, they could have availed of such scheme but in this case, there seems to be none. We are also apprised that some of the petitioners have applied for appointment through the current recruitment process. The High Court has rejected their claim mainly on the ground that they have no right to seek regularization of their service.”

Relying on both the above-mentioned decisions the Court dismissed the Petitions.