Regularization does not entitle retrenched employee to claim re-employment, SC

The Supreme Court has held that the regularization of an employee already in service does not give any right to a retrenched employee to invoke Section 25(H) of the Industrial Disputes Act, 1947 in order to claim re-employment..The Court has explained that if an employer regularizies the services of an employee already in service, it does not amount to offering fresh employment to any person to fill any vacancy, and therefore, Section 25(H) would not apply..“In our view,there lies a distinction between the expression ‘employment’ and ‘regularization of the service”. The expression ‘employment’ signifies a fresh employment to fill the vacancies whereas the expression ‘regularization of the service’ signifies that the employee, who is already in service, his services are regularized as per service regulations.”.The judgment was passed by a Division Bench of Justices AM Sapre and Indu Malhotra in an appeal against an order passed by the Punjab & Haryana High Court directing the appellant to reinstate the respondent workman into service with back wages..The respondent was working as a peon with the appellant, a Cooperative Marketing Society which terminated his services in July 1985..The Labour Court held the termination was bad in law and awarded a lump sum compensation of Rs. 12,500 to the workman in lieu of reinstatement in service. Both the parties then moved the High Court challenging the legality and correctness of the Labour Court’s Award. However, after the High Court upheld the decision of the Labour Court, the workman accepted the compensation awarded to him..After learning that the appellant has regularized the services of two peons, the workman filed a representation to the appellant, claiming re-employment in terms of Section 25(H) of the ID Act. The same was rejected by the appellant..In the industrial reference at the instance of the workman, the Labour Court held that he had no right to claim re-employment in the appellant’s services under the provision..Aggrieved by the award, the workman then moved the High Court under its writ jurisdiction. A Single Judge Bench allowed the writ petition and set aside the award passed by the Labour Court, directing the re-employment of the workman. The decision was upheld by a Division Bench. The appellant then moved the Supreme Court in appeal..Restoring the award of the Labour Court, the Supreme Court held that there was no case made out by the respondent workman to seek re-employment in the appellant’s services on the basis of Section 25 (H) of the ID Act..The Court observed that since the workman had already accepted the compensation awarded to him in lieu of his right of reinstatement in service, “the said issue had finally come to an end”..The Court also stated that Section 25(H) had no application to the case at hand..It observed that the object behind Section 25(H) is to give preference to retrenched employee over other persons by offering them re-employment in the services when the employer takes a decision to fill up the new vacancies..“…in order to attract the provisions of Section 25(H) of the ID Act, it must be proved by the workman that firstly, he was the “retrenched employee” and secondly, his ex-employer has decided to fill up the vacancies in their set up and, therefore, he is entitled to claim preference over those persons, who have applied against such vacancies for a job while seeking re-employment in the services.“.Drawing a distinction between ’employment’ and ‘regularization of services’, the Court held that the workman was not entitled to invoke the provisions of Section 25 (H) and seek re-employment by citing the case of another employee who was already in employment and whose services were only regularized by the appellant..It thus set aside the order passed by the High Court and restored the award passed by the Labour Court..The appellant was represented by Advocate Ajay Kumar. The workman was represented by Advocate Shish Pal Laler..Read the Judgement: