Brief of the Case:
Mr K Ramesha was working as Senior Service Programmer in HCL Technology at Bangalore since 20-Aug-2009.
His service was confirmed by the company on February 26, 2010.
His performance was appreciated in 2010 and revised his salary.
COURSE OF ACTION
On January 22, 2013, his services were terminated on the ground that his performance was not satisfactory and he had not shown any improvement despite counselling.
On January 22, 2013, his services were terminated on the ground that his performance was not satisfactory and he had not shown any improvement despite counselling.
COURT PROCEEDINGS
Mr Ramesha has challenged his dismissal before the Labour Court Chennai demanding dismissal order be set aside.
Mr Ramesha has challenged his dismissal before the Labour Court Chennai demanding dismissal order be set aside.
MANAGEMENT STAND
The management had argued that Ramesha was a supervisor and, therefore, had been exempted from the definition of the term workman.
The management had argued that Ramesha was a supervisor and, therefore, had been exempted from the definition of the term workman.
COURT OBSERVATION
1. The Company has not produced any evidence to show that failure to improve performance or failure to measure up to the expectations or standing orders of the company would amount to an act of misconduct."
1. The Company has not produced any evidence to show that failure to improve performance or failure to measure up to the expectations or standing orders of the company would amount to an act of misconduct."
2. The company apparently did not ask him for an explanation. It did not serve a charge sheet or conduct an enquiry.
3. It cannot be denied that the job of an engineer in a software company involves skills and technical knowledge.
Therefore, it can be concluded that the job of a software engineer can be termed as skilled or a technical one,".
4. "Any person doing a skilled job is a workman under the definition of that term. So the court concluded that the Ramesha is a workman,".
5. In Clause 6 of the appointment order, it is stated that the service of an employee can be terminated by giving 30 days' notice or by payment of a month's salary in lieu of notice without assigning any reasons.
But the appointment order does not contain any provision to show that failure to improve performance would result in dismissal of an employee.
COURT ORDER
The Hon'ble Additional Labour Court presiding officer S.Nambirajan has set aside the dismissal of K. Ramesha. The court ordered the company to reinstate Ramesha with continuity of service and pay full back wages and all other benefits from the date of dismissal till the date of reinstatement.
The Hon'ble Additional Labour Court presiding officer S.Nambirajan has set aside the dismissal of K. Ramesha. The court ordered the company to reinstate Ramesha with continuity of service and pay full back wages and all other benefits from the date of dismissal till the date of reinstatement.
IMPLICATION ON IT INDUSTRY
The order sets a legal precedent and will send alarm bells ringing in the IT hothouses that have tough appraisal standards for employees and regularly weed out "non-performers".
The order sets a legal precedent and will send alarm bells ringing in the IT hothouses that have tough appraisal standards for employees and regularly weed out "non-performers".
LEGAL STATUS & CASE LAWS
Definition
The Industrial Disputes Act, 1947, defines a workman as "any person (including an apprentice) employed in any industry to do any manual, unskilled, skilled, technical, operational, clerical or supervisory work for hire or reward, whether the terms of employment be express or implied, and for the purposes of any proceeding under this act in relation to an industrial dispute, includes any such person who has been dismissed, discharged or retrenched in connection with, or as a consequence of, that dispute, or whose dismissal, discharge or retrenchment has led to that dispute." But it also carries a proviso that says the definition of a workman does not cover a person employed in a supervisory capacity who "draws wages exceeding Rs.1'600/- per mensem (month) [Now it is Rs.10,000/- p.m.] or exercises, either by the nature of the duties attached to the office or by reason of the powers vested in him, functions mainly of a managerial nature".
The Industrial Disputes Act, 1947, defines a workman as "any person (including an apprentice) employed in any industry to do any manual, unskilled, skilled, technical, operational, clerical or supervisory work for hire or reward, whether the terms of employment be express or implied, and for the purposes of any proceeding under this act in relation to an industrial dispute, includes any such person who has been dismissed, discharged or retrenched in connection with, or as a consequence of, that dispute, or whose dismissal, discharge or retrenchment has led to that dispute." But it also carries a proviso that says the definition of a workman does not cover a person employed in a supervisory capacity who "draws wages exceeding Rs.1'600/- per mensem (month) [Now it is Rs.10,000/- p.m.] or exercises, either by the nature of the duties attached to the office or by reason of the powers vested in him, functions mainly of a managerial nature".
OBSERVATION
The Labour Court does not appear to have considered HCL's argument that Ramesha was engaged in a managerial capacity and also not considered some of the important case laws of higher courts.
The Labour Court does not appear to have considered HCL's argument that Ramesha was engaged in a managerial capacity and also not considered some of the important case laws of higher courts.
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