w w w . L a w y e r S e r v i c e s . i n



MRF United Workers Union, Rep. by its General Secretary, Arakkonam v/s The Commissioner of Labour, DMS Compound Chennai & Others

    W.P. Nos. 24228 of 2016 & 34038 of 2013 W.M.P. Nos. 20694 to 20697 of 2016 & M.P. No. 1 of 2013

    Decided On, 03 April 2018

    At, High Court of Judicature at Madras

    By, THE HONOURABLE MR. JUSTICE M.M. SUNDRESH

    For the Appearing Parties: V. Prakash, Senior Counsel, K. Sudalaikannu, Sanjay Mohan for M/s S. Ramasubramaniam & Associates, C. Manishankar, Additional Advocate General Asst. by V. Kadhirvelu, M/s. Shivabharathi, T. Ramkumar, K.M. Ramesh, V. Prakash, Senior Counsel, K. Sudalaikannu, Advocates.



Judgment Text

(Prayer: Writ petition in W.P.No.24228 of 2016 is filed under Article 226 of the Constitution of India praying for an issuance of writ of certiorarified mandamus to call for the records of the 1st respondent in connection with proceedings bearing Ref.No.C2/ 58170/2015 dated 30.3.2016 and the Corrigendum bearing Ref.No.C2/ 58170/2015 dated 30.3.2016, quash the same and direct the 1st respondent to do the Verification Process in accordance with the procedure in the Code of Discipline or through Conduct of Secret Ballot.

Writ petition in W.P.No.34038 of 2013 is filed under Article 226 of the Constitution of India praying for an issuance of Writ of Certiorari to call for the records connected with M.A.No.29 of 2010 in I.D.No.14 of 2008 on the file of the respondent i.e., the Presiding Officer, Industrial Tribunal, Chennai and to quash the order dated 30.10.2013 made therein.)

Common Order:

Though different views are expressed on the inter se connection between the two cases, having heard them together involving the same parties, they are disposed of accordingly.

2. For the sake of brevity, the petitioner in W.P.No.24228 of 2016 is to be noted as such for both the cases.

3. The writ petitioner in W.P.No.34038 of 2013 is hereinafter referred to as Management and the fourth respondent Union viz.,MRF Arakonam Workers Welfare Union is referred to as the respondent.

4. M/s MRF Limited has a factory at Arakkonam, dealing in manufacturing of tyres and tubes. Settlements have been signed with MRF Cycle Tyre Unit Employees' Association, between 1989 and 2004. The writ petitioner, MRF United Workers Union, raised an industrial dispute relating to wages and services in I.D.No.14 of 2008. During the pendency of the conciliation and before the reference, a settlement was signed by MRF Cycle Tyre Unit Employees' Association with the Management in the year 2004. Another settlement was signed by the respondent- MRF Arakonam Workers Welfare Union during the pendency of the dispute. It appears that vast majority of the workers accepted the settlement from the year 1989 and reaped the benefit. However, despite the fact that the settlement was accepted by 1301 out of 1395 workmen resulting in the benefits enjoyed by them, they disputed the signature in the acceptance letter.

5. During the pendency of the reference before the Tribunal, the petitioner filed another writ petition in W.P.No.1799 of 2008, which was ultimately disposed of by the Division Bench in W.A.No.674 of 2009. The following observation is relevant for the purpose of this case.

' .... In view of the disposal of the writ petition with the directions specified above, the writ appeal stands disposed of. The miscellaneous petitions will stand disposed of. Those workmen who want to avail the benefit of the settlement will be free to accept it, though it will be open to the petitioner union to challenge the legality and validity thereof by taking appropriate steps by raising demand and carrying the matter to the Industrial Tribunal...'

6. The Management filed an interim application in M.A.No.29 of 2010 before the Industrial Tribunal seeking the following prayer.

'.... It is therefore prayed that this Hon'ble Court may be pleased to pass an Award in I.D.No.14 of 2008 as per and in terms settlement dt.22.12.2004 (Ex.M3) under Section 18(1) of the Industrial Disputes Act between the Management of MRF Limited, Arakonam and MRF Cycle Tyre Unit employees' Association for the period 01.01.2005 to 31.12.2008 and in terms of settlement dt. 09.05.2009 (Ex.M8) under Section 18(1) of the Industrial Disputes Act that has been accepted by 1004 workmen out of 1396 workmen for the period 01.01.2009 to 30.04.2013 and thereby render justice....'

7. A joint memo dated 25.03.2011 was filed before the Tribunal, which is as under:

'The parties above named consents to the legality and validity of the alleged settlement of 22.12.2004 entered into between the respondent Management and MRF Cycle Tyre Unit employees Association and the alleged settlement of 09.05.2009 between the respondent management and the MRF Arakkonam Workers Welfare Union to be tried and decided by this Honourable Tribunal in M.A.No.28 and 29 of 2010.'

8. A settlement under Section 12(3) of the Industrial Disputes Act, 1947,(hereinafter referred to as 'the Act') was entered into on 03.07.2013. It was also brought to the notice of the Tribunal by a Memo dated 17.07.2013. This settlement, which obviously binds the parties has not been put into challenge. There was also a settlement entered into thereafter under Section 18(1) of the Industrial Disputes Act, 1947, in the year 2017 with the majority of the workmen. The Tribunal rejected the application filed by the Management primarily on the ground that there is no material to hold that the settlement under Section 18(1) of the Act was signed with the majority of the Union. It is further held that there is no material to substantiate the approval of the general body before entering into the settlement and the various letters given by the workmen cannot be termed as settlements. Incidentally, the Tribunal gave certain findings in favour of the Management, such as, the election did take place, signatories of Ex.M3 settlement were elected members of the MRF Cycle Tyre Unit Employees' Association and the letters cannot be disputed. However, it was also held that the onus was on the Management to prove the factum of settlement preceded by the resolution approved by the general body of the Union, which signed it. Accordingly, the application was dismissed. Challenging the same, W.P.No.34038 of 2013 has been filed.

9. The petitioner-Union filed writ petition in W.P.No.17991 of 2008 seeking to implement the recognition of the International Labour Organization with specific reference to its recognition, which is against the order. The writ petition in W.P.No.17991 of 2008 and the writ appeal in W.A.No.674 of 2009 were disposed of by a common order on 08.09.2009. The core issue before the Division Bench was to the applicability of Code of Discipline. The said issue was answered with a direction to determine the recognition of the Unions, which reads thus.

'37. Having noted this scenario and considering that there is continuous strife in the company, in our view, the Court cannot simply remain a silent spectator. We are aware that the Court has its own limitations while exercising jurisdiction to issue appropriate writ or direction. On analyzing the provisions of Article 19(1)(c), it recognizes the right to form association and also the mandate of Industrial Disputes Act that there should be recognized union and when there is a inclination of the State Government to accept a particular procedure, which is otherwise also accepted in different statutes throughout the country, in our view, the correct course will be to give a direction to the Commissioner of Labour to call upon the two unions to submit their membership details as per the Code of Discipline and examine their membership as provided under the Code over a period. In the event, there are any objections, the objections could be verified in the light of clause-7 of the Code of Discipline by personal interrogatories so as to arrive at the correct membership of either of the two trade unions. Alternative to this procedure namely, ballot system, which, although is recommended by the Committee of the ILO, is not accepted in any of the statutes which have been brought to our notice. The recommendations of the Committee can only be respected to this effect that there has to be a collective bargaining agent of the workmen, which is to be a truly and independent representative agent. As far as the methods suggested by the Committee is concerned, it would result into determination on the basis of the facts arrived at a particular point of time, which has not been very much appreciated as a proper method. The method of verification on the other hand will show the following of a particular union over a longer period and would definitely be a better option. The other alternative approach is to say that none of the methods is recognized and therefore the choice of the management will prevail. That certainly cannot be permitted in view of the provisions of the fifth schedule of the Act. The Code of Conduct has a force of acceptance of the organizations of the workers and of the Management and also of the Government, and is being followed in different undertakings. Further, it is also in tune with the provisions of the different statutes in different States.

38. In the circumstances, in our view, the only alternative, as stated above, is to direct the State Government and the Commissioner of Labour to conduct the exercise as per the Code of Discipline, to which the State Government is agreeable. Accordingly, the Petitioner Union may apply to the concerned Labour Commissioner within two weeks from today presenting the claim of its membership figures during the last six months i.e., for the period from 1st march, 2009 to 31st August, 2009. On receipt of such an application, the concerned Labour Commissioner will issue notice to the two unions, within two weeks from the date of receipt of the application, calling upon them to submit their membership registers and the necessary supportive documents under the Code of Discipline within two weeks from the date of receipt of the notice by them. The notice will call upon them to produce their records as per the Code of Discipline during the period of six months prior to the date of notice. The Labour Commissioner shall thereafter proceed to decide as to which Union is the representative union of the workmen. We cannot permit the Management to say that the Union which shows the larger membership at the end of the exercise will not be recognized by the Management. Recognition is for the purpose of representing the causes of the workmen in various fora including before the Management and various authorities under the Labour Law. It is not a determination available for the sole satisfaction of the Management. It is a factual determination and the determination leads to a status. The Union which establishes a larger membership at the end of the aforesaid exercise, shall be recognized as the representative union.

39. The writ petition is allowed with the aforesaid directions. In view of the disposal of the writ petition with the directions specified above, the writ appeal stands disposed of. The miscellaneous petitions will stand disposed of. Those workmen who want to avail the benefit of the settlement will be free to accept it, though it will be open to the petitioner union to challenge the legality and validity thereof by taking appropriate steps by raising demand and carrying the matter to the Industrial Tribunal.'

10. As against the order passed by the Division Bench, the Management has filed Civil Appeal Nos.5226-5227 of 2010 before the Apex Court and the same was subsequently withdrawn on 02.12.2015. Thereafter, the process of verification was made by none other than the Commissioner of Labour. Before completion of the process, Standard Operating Procedure was adopted and explained to all the participants. A copy was also served on them. A long deliberation took place preceding the same and there was an agreement to conduct the personal verification within the factory premises. Accordingly, the respondent viz., MRF Arakonam Workers Welfare Union was declared to be the sole representative Union having secured support from the 820 employees. The verification process was done with two list of employees in compliance with the order of the Division Bench and the prevailing situation thereafter. It is to be noted that the Meeting conducted was not only attended by all the seven Trade Unions for finalising the Standard Operating Procedure, but the Revenue and Police Officials as well. The entire proceeding was video graphed. It appears that the petitioner also issued a pamphlet after the verification process was over, expressing its full satisfaction on the fair procedure adopted. Now, a challenge is made to this order by the petitioner raising various grounds.

11. The learned counsel for the Management would submit that the Tribunal has committed a fundamental error in going to a irrelevant issue of a majority union qua the settlement under Section 18(1) of the Act. What is important and relevant is the signing of the settlement unconditionally by the majority workmen. The settlement was accepted by the majority workmen admittedly. They also got the benefits. The letters were found to be true and genuine. These letters were not the settlements, but they acknowledged the factum. There is no material to hold any exercise of force and coercion. It is not even the case of the Union that there was no general body.

12. Having found that there was an election followed by signing of the settlement by the office bearers, resultant relief ought to have been granted. This Court can go into the fairness of the settlement. The mere fact that the settlement has been accepted by majority itself would show that Tribunal has failed to take into consideration of the settlement under Section 12(3) of the Act. Even in the settlement arrived at in the year 2009, there was a specific reference about the earlier settlement. After signing of the settlement, the arrears due to the workmen were given. All payments are being made on a monthly basis including the attendant benefits. There was a negotiation before the settlement arrived at. The settlements were not challenged specifically. When once majority of the workmen accepted the settlement, the Tribunal ought to have granted the relief. The workmen are also bound by the principle of estoppel being the beneficiary of the settlement. The Tribunal has wrongly fixed the onus on the Management. Therefore, the order passed by the Tribunal requires interference.

13. Insofar as W.P.No.24228 of 2016 is concerned, it is submitted that the Code of Discipline was followed in letter and spirit. What is to be seen is the process of verification. The procedure adopted was accepted by everyone. There is no element of bias involved. The petitioner-MRF United Workers Union did not object to the standard operating procedure. The single membership of the Unions as recorded in the order under challenge has not been disputed by the petitioner Union. Everything has been done in a transparent manner. The difference between the petitioner Union and the respondent is rather huge. As the entire process was done in an appropriate manner, no interference is required.

14. Mr.K.M.Ramesh, learned counsel appearing for the respondent -Arakonam MRF Workers Welfare Union, would submit that majority workmen have accepted the settlement entered into with the Management. In the absence of the mala fides, no interference is required. What has happened in the past has got no relevancy. Having failed to get the recognition, the petitioner Union has come forward to file the present writ petition with untenable grounds. The subsequent events, including the two settlements, both under Section 12(3) and 18(1) of the Act, are to be taken into consideration. Therefore, it is not a case where power under Article 226 of the Constitution of India requires to be invoked.

15. The learned Additional Advocate General appearing for the respondents 1, 2 and 12 in W.P.No.24228 of 2016 would submit that there is no bias as alleged. The Officer was merely working for few months as the Apprentice. The order was passed by the Commissioner of Labour, Chennai, after adopting the specific procedure and not by the said Officer. There is nothing contrary to the Code of Discipline. When an action was done in the official capacity, the question of mala fides would not arise. The petitioner did not raise it at the relevant point of time. Therefore, he submitted that W.P.No.24228 of 2016 has to be dismissed.

16. Insofar as W.P.No.34038 of 2013 is concerned, the learned Additional Advocate General submits that he has no submission to make as it is a dispute between the Management and the petitioner Union.

17. Mr.V.Prakash, the learned Senior Counsel appearing for the petitioner Union, would submit that the order passed by the Tribunal has to be sustained both on law and facts. The background facts will have to be seen. There is a constant attempt to destroy the petitioner Union. The respondent Union was started after the defeat in the election conducted for MRF Cycle Tyre Unit Employees Association. The dispute was raised after much difficulty. The report given by the authorities prior to the dispute would clearly indicate the intention of the Management. Courts will have to uphold the concept of collective bargaining. As the Tribunal passed the order by assessing the relevant materials, no interference is required for invoking the extraordinary jurisdiction of this Court.

18. W.P.No.24228 of 2016 is liable to be allowed since the Code of Discipline has not been followed in letter and spirit. There is a serious apprehension of the status of particulars of the other Union being shown as that of the respondent Union. Admittedly, some of the workmen were the members of both the petitioner and the respondent Unions. The list of the respondent Union and others have not been shown. There is also an element of bias with the Officer, who did the verification process on ground. Thus, W.P.No. 24228 of 2016 has to be allowed.

19. After conclusion of the arguments, this Court made a suggestion as to whether a fresh verification process can be done. As there was no consensus, both on the issue of the undertaking the exercise and the manner in which it is to be done, this Court is proceeding with the matter on merit.

20. A perusal of the order passed by the Tribunal would show that it has committed a fundamental and basic error in presuming that the settlement under Section 18(1) of the Act will have to be entered into between the Union representing the majority workmen. As rightly submitted by the learned counsel appearing for the Management, what is relevant is the acceptance of the majority of the workmen. In the case on hand, the settlement was accepted by 1301 out of 1395 workmen. Not only that, all those who accepted the settlement have received the benefit. We are dealing with a case, in which, the workmen oscillate between one Union and other. The Tribunal did give a factual finding that the workmen did sign Exs.M4, M6 and M24. These letters as notarised are not admittedly settlement entered into under Section 18(1) of the Act, but mere acknowledgement of it. The Tribunal also gave a finding that the benefits were accepted voluntarily. It is an admitted fact that the workmen received the benefits flowing from the settlements viz., Exs.M3 and M8. Therefore, as rightly submitted by the learned counsel appearing for the Management, the principle of estoppel would certainly apply.

21. The Tribunal went on to commit further errors in giving a finding that there is no material to hold that the settlement was arrived at in pursuant to the resolution passed by the general body of the respondent Union viz.,MRF Cycle Tyre Unit Employees Association. It is not even pleaded by the petitioner Union. On the contrary, it is the specific case of the petitioner Union that the letters of Acceptance are not true and genuine, which was rightly rejected by the Tribunal. The Tribunal has given a factual finding that the election did take place and thereafter, settlement was signed by the office bearers under Section 2(p) of the Act. In any case, none of the workmen has challenged this. This was also for the reason that they were enjoying the benefits of the settlement. Certainly, the Management cannot be asked to prove the factum of convening of the general body followed by elected office bearers signing the settlement. Suffice it is to state vast majority of the workmen accepted the settlement. A perusal of the settlement entered into in the year 2009 also shows that all the disputes have been settled. It is to be noted that even the Secretary of the respondent Union has stated that 1003 workmen have received the benefits which arose from Ex.M3.

22. Thus, from the above, this Court is of the view that the order passed by the Tribunal cannot be sustained. The only other issue, which can be gone into is as to whether the settlements are fair. Inasmuch as the vast majority of the workmen have not only accepted the settlement but received the benefits, this Court is not willing to remit the matter for the aforesaid purpose at this point of time. This is also for the reason that subsequent settlements have come into being including one under Section 12(3) and under Section 18(1) of the Act. Unfortunately, the Tribunal has not taken note of the settlement under Section 12(3) of the Act. Suffice it is to state that much water has flown under the bridge. Upholding the order of the Tribunal or remanding for fresh consideration would certainly affect the industrial peace and harmony over an issue, which has been settled. Further more, both the sides argued the application on merit before the Tribunal. On a perusal of the settlements, it is very clear that they have taken into consideration of several factors including the revision of wages, dearness allowance, increment, attendance allowance, house rent allowance, washing allowance, bonus, accident policy, annual gift, transport, national and festival holidays among other things. Thus, apart from the above, this Court is of the view that there is a reasonable increase given by the Management on different heads. In such view of the matter, this Court is inclined to set aside the order passed by the Tribunal and consequently, the application filed in M.A.No.29 of 2010 in I.D.No.14 of 2008 stands allowed as prayed for. As a result, the writ petition filed in W.P.No.34038 of 2013 is allowed.

23. A perusal of the order passed by the Commissioner of Labour would show that the exhaustive procedure was followed in determining the status through verification. All the records were perused, membership register analysis and dual members were taken note of. Having found the dual membership as of 2009 personal interrogation was also made on the Code of Discipline. The verification process was informed to the revenue officials headed by the District Collector, apart from the help of the Police Department. The meeting prior to the verification was attended by all the Unions and by its representatives. The only request made by the petitioner was to conduct the process in a neutral place. Thereafter, a long deliberation took place, upon which, it was agreed to conduct a personal verification within the factory premises. The standard Operating Procedure was also explained to all the representatives of the respective Unions, followed by service of the copies.

24. Every workman was interrogated by a team of two officers. A huge force of police was also deployed. The conduct of the verification process was done to the satisfaction of the Unions. The personal hearing was conducted in the presence of the Commissioner of Labour. A factual finding has been recorded that the workman had clearly indicated their preference for one Union only. Accordingly, the respondent Union obtained the support from 826 employees.

25. Thus, this Court does not find any violation of the Code of Discipline. The petitioner Union did express its satisfaction. There was no objection at any point of time. The contention that the membership status of one Union has been included in the respondent Union being a mere allegation cannot be countenanced. The petitioner Union is also not entitled in law to have a copy of the list containing the status of an employee qua the other Unions. The procedure for secret ballot was not found favour by the Division Bench. It was also not contemplated in the Code of Discipline. To be noted, we are concerned with the status qua the Union through the verification process. After all, this Court is exercising power under Article 226 of the Constitution of India and thus not expected to go into the minute factual details. The procedural violation, if any, cannot help the petitioner Union, who did accept to the process indicated. After all, we are concerned with the substantive compliance.

26. This Court does not find any bias involved in the verification process. The authority under whose leadership the process was completed was the Commissioner of Labour. Merely because one of the Officers did work as an Apprentice for some time with the Management, no motive can be attributed. The petitioner Union did not raise it at the relevant point of time. The Officer was discharging her official duty. A plea of likelihood of bias has to be raised and proved to the satisfaction of the Court. Th

Please Login To View The Full Judgment!

ere is no benefit that can be attributed to the officer. It is also to be seen that personal interrogation was done by a team of two officers. Hence, the contention of bias cannot be sustained. 27. The learned Senior Counsel appearing for the petitioner also would submit that the concept of collective bargaining has been given a go by. Therefore, this aspect will have to be looked into in dealing with both the cases. Though there is no difficulty in appreciating that there should be an element of collective bargaining, this Court has only to see if anything is done contrary to it. When once it is held on facts that the settlement under Section 18(1) of the Act was arrived at by the majority of the workmen, then the concept of collective bargaining has to be held in its favour. The fact that most of them wanted to wriggle out of it subsequently after enjoying the fruits cannot be a ground to hold against the concept of collective bargaining. In the same way, this Court does not find the concept of collective bargaining being affected. The reliance made by the learned Senior Counsel on the happenings prior to the settlements would not help the case of the petitioner. Accordingly, W.P.No.24228 of 2016 stands dismissed. 28. One more issue has to be considered. This is with respect to the ensuing election to be held. As recorded above, the learned Senior Counsel appearing for the petitioner Union was willing to give up most of the contentions raised. There was some objection on the fresh verification process and on the process to be adopted, especially, the secret ballot. However, one thing is clear, which is the expiry of the term, which gives the status of representative Union to the respondent. Considering the long and chequered history involving prolonged battles and with the fond hope of putting an end, this Court is of the view that appropriate direction will have to be given to the Commissioner of Labour viz., the first respondent to undertake the similar exercises done earlier by following standard Operating Procedure as per the Code of Discipline and after conducting a meeting with all the Unions. Appendix-III(6) and (7) are also to be followed among other things. The verification process will have to be completed with the identification of the representative Union within a period of four months from the date of receipt of the copy of this order. Though an objection was raised by the respondent Union in this regard, the same stands rejected as even on the earlier occasion, the Division Bench judgment of this Court referred to supra has directed the Commissioner of Labour to undertake the aforesaid exercise on a writ petition filed by the present petitioner Union. No costs. Consequently, connected miscellaneous petitions are closed.
O R