Terms Of Appointment Permits Transfer To Any Department/Office Of Company: SC Upholds Transfer Of Employees By Divgi Metal Wares Ltd.
The Supreme Court upheld the transfer of workmen of Divgi Metal Wares Ltd. observing that the terms of appointment of their employment permitted such transfer.
The Court explained that the terms of the appointment in the appointment order of the employees clearly stipulated that their services were transferable to any department or any work office in the Country.
Therefore, the Court held that the transfers of the employees could not have been held to be invalid in view of the law laid down in Cipla Ltd. v. Jayakumar R. (1999) 1 SCC 300.
Justice B.R. Gavai and Justice Sandeep Mehta observed, “Another aspect that needs to be taken into consideration is that clause 31 of the Schedule of the Standing Order, which is reproduced herein above specifically provides that nothing contained in the Standing Order shall operate in derogation of any law for the time being in force or cause prejudice to any right under contract of service, custom or usage or an agreement, settlement or award applicable to the establishment.”
Sr. Advocate C.U. Singh represented the appellant, while Sr. Advocate S.G. Hasnen appeared for the respondents.
Divgi Metal Wares Ltd. (the employer) had transferred 66 employees from its Karnataka factory to Maharashtra on account of reduction in orders and lack of sufficient work. Despite being provided advance payment for travel expenses, the transferred employees did not report to the Pune Factory and raised an industrial dispute.
Prior to this, the company had passed a standing order regarding the transfer of its employees within the country under the Industrial Employment (Standing Orders) Act, 1946.
The Court relied on the decision in the case of Cipla Case (supra) where the transfer of workmen from one factory to another was not interfered with.
The facts in the Cipla case (supra) were similar to the present case where a clause in the letter of appointment granted the employer the right to transfer a worker from one establishment in a state to any other establishment of the company across India. Meanwhile, a clause in the company's Standing Order specified the department where a worker could be assigned within the same state establishment. The Court had held that “the Standing Order does not in any way refer to or prohibit the transfer of a workman from one establishment of the appellant to another and thus, there is no conflict between the said clauses.”
Relying on the Cipla Case, the Court held that in the present case too, “there would be no conflict between the Standing Order and the terms and conditions as stipulated in the order of appointment/confirmation.”
Moreover, “the terms of appointment and confirmation would permit the transfer of an employee to any department or any works or offices belonging to the company,” the Court remarked.
Accordingly, the Supreme Court disposed of the appeals.
Cause Title: M/S. Divgi Metal Wares Ltd. v. M/S. Divgi Metal Wares Employees Association & Anr (Neutral Citation: 2024 INSC 237)
Appearance:
Appellant: Sr. Advocate C.U. Singh; AOR K. Rajeev; Advocates Nitin S. Tambwekar, Prasant B. Bhat, Seshatalpa Sai Badhru and Deepak V Kulkarni
Respondents: Sr. Advocate S.G. Hasnen; AOR Varinder Kumar Sharma; Advocates Shantanu Sharma, Deeksha Gaur, Krishna, Parul Sharma and Deeksha Gaur
