The Bombay High Court has held that Clause 4A of Schedule I of the Model Standing Orders does not grant automatic or deemed confirmation on completion of the probationary period. Even where the probation period under the Standing Orders is shorter, permanency can arise only upon issuance of an order in writing making the probationer permanent, and in the absence of such written confirmation, discharge on completion of probation does not entitle the employee to claim permanency as a matter of right.
The Court further held that where appointment letters expressly require a separate written confirmation after satisfactory assessment, and no such confirmation is issued, continuation or completion of probation by itself does not confer permanent status. Accordingly, the Industrial Court was right in setting aside the Labour Court’s order, and no interference with the impugned judgment was warranted.
The Division Bench comprising Justice G. S. Kulkarni and Justice Aarti Sathe observed that Clause 4A of Schedule I requires a holistic reading. Though it states that every probationer who completes three months’ uninterrupted service shall be made permanent, it also requires an overt act of making the probationer permanent by an order in writing. The second proviso permits termination after the probationary period if the services are found unsatisfactory. Thus, the provision does not dispense with the requirement of a written order of confirmation.
The Bench observed that Model Standing Order No. 32 protects rights under a contract of service to the extent they are more beneficial to the employee, but it cannot be read to confer automatic or deemed confirmation merely on completion of the probationary period. The requirement of a specific written order making the probationer permanent remains intact, and during probation the employer is not barred from appraising whether the probationer’s services are satisfactory.
The Bench noted that in the present case the appellants were first trainees, then temporary employees, and only thereafter probationers. It was undisputed that after the traineeship period and temporary employment period, full and final settlements were paid, and all terms of employment were accepted by the appellants without protest. The Industrial Court was therefore justified in holding that the appellants, having accepted successive appointment letters without protest, could not subsequently challenge those terms in the manner sought.
The Bench relied on the sample probation appointment letter, which specifically provided that if overall performance was found satisfactory, services would be confirmed in writing by a separate letter, failing which employment would come to an end on completion of probation. Since no such confirmation letters were issued to the appellants, the Bench held that they were not entitled to permanency benefits after completion of probation.
The Bench also held that Section 25F of the Industrial Disputes Act was not attracted because the appellants had not been in continuous service for not less than one year, were not confirmed as permanent employees after probation, and their legal dues had been paid. It further held that although the respondent argued that the case fell under Section 2(oo)(bb), that contention was not accepted because the probation period was governed by Clause 4A of Schedule I; nevertheless, absence of written confirmation disentitled the appellants from claiming deemed confirmation or retrenchment benefits.
Briefly, the appellants were engaged by the respondent company in stages: first as trainees for one year, then on temporary appointments, and thereafter on probation. Appellant No. 1 was appointed as trainee on September 09, 1996, later given temporary appointment on September 09, 1997, placed on probation from March 01, 1998, and his services were terminated on August 31, 1999. Appellant No. 2 was appointed as trainee on March 12, 1996, thereafter temporarily appointed on March 13, 1997, placed on probation from September 01, 1997, with extension from February 28, 1998, and his services were terminated on August 31, 1999. Appellant No. 3 was appointed as trainee on June 17, 1996, thereafter temporarily appointed on July 01, 1997, placed on probation from January 01, 1999, and his services were terminated on June 30, 1998. Appellant No. 4 was appointed as trainee on August 05, 1996, temporarily appointed on August 01, 1997, placed on probation from February 01, 1998, and his services were terminated on July 31, 1998.
Being aggrieved, the appellants filed complaints under Section 28 of the MRTU and PULP Act alleging unfair labour practices under Item 1(a), (b), (d) and (f) of Schedule IV. The Labour Court partly allowed the complaints and held that the respondent had engaged in unfair labour practice under Item 1(b) and (f) of Schedule IV, directing reinstatement with continuity and 50% back wages. In revision, the Industrial Court set aside that order and dismissed the complaints. The petition challenging the Industrial Court’s order was dismissed by the Single Judge, against which the present Letters Patent Appeal was filed.
The principal issue before the Division Bench was whether termination of the appellants after completion of probation was contrary to Clause 4A of Schedule I of the Model Standing Orders, and whether Rule 32 of the Model Standing Orders would prevail so as to entitle the appellants to continuance or permanency after the probation period.
Appearances:
Advocates Bhavesh Parmar, Reshma Nair, Devmani Shukla, and Devmani Shukla, for the Appellants
Advocates Neel Helekar, Atman Mehta, and Vipul Patel, for the Respondent no.1
Advocates Shruti Vyas and Savita Prabhune, for the Respondent-State
