JAY ENGINEERING WORKS LIMITED Vs. UNION OF INDIA

JUDGEMENT

(1.) This writ petition was heard along with writ petition No.62 of 1962 (Bridge and Roof Company (India) Limited vs. Union of India), as the short question in both of them was whether production bonus was excluded from the term "basic wages" as defined in S.2(b) of the Employees Provident Fund Act, No 19 of 1952, (hereinafter referred to as the Act). A further question also arose in this writ petition as to the nature of the production bonus scheme in force in the petitioner company, and the parties were given time to file additional affidavits in that connection. The main point raised in the two writ petitions was decided in Bridge and Roof Company (India)Ltd. vs. Union of India, 1962-2 Lab LJ 490. The only question that now remains is whether the production bonus scheme in force in the petitioner-company is of the same type as in Bridge and Roof Company, 1962-2 Lab, LJ 490 If it is of the same nature the present petition would be governed by that decision and production bonus would be excluded from the term "basic wages" as defined in the Act. The parties have additional affidavits and it now remains to determine the nature of production bonus in force in the petitioner-company and to decide whether the decision in the Bridge and Roof Company 1962-2 Lab LJ 490 would apply in the present case, and if so, to what extent.

(2.) It appears that some kind of production bonus scheme was started in the petitioner company in 1947 and that scheme is said to have been more or less on a straight piece-rate system. Then came the major engineering awards in the years 1948,1950 and 1958, fixing basic minimum wages and its dearness allowance. This was followed by an agreement between the petitioner-company and its workmen in August 1958 in which the present Scheme in force was established even though some kind of production bonus on a more or less straight piece-rate system was in force from as far back as 1947. The scheme which was established by the agreement of 1958 was this. A certain proportion of the production was taken to correspond to the minimum basic wages and dearness allowance fixed by the awards, and this was termed as "Quota". The production above the quota was paid for at piece-rate. But there was a "norm" also fixed which was much higher than the "quota" and every workman was normally expected to produce the "norm" as the minimum production. If the workman did not produce the "norm", he would be guilty of misconduct and would be liable to dismissal, as the agreement provided that any deliberate deviation from production norms would amount to go slow tactics. The standing orders of the course provide that go- slow tactics would amount to misconduct and may lead to dismissal of workman concerned.

(3.) It will be seen therefore that the peculiar feature of the production bonus scheme in force in the petitioner-company is that it has got two bases namely, (i) the quota, and (ii) the norm, the quota being much lower than the norm. In view of the agreement between the parties and the precise definition of "go- slow " contained in that agreement, it is clear that workmen are expected to give the "norm" as the minimum production and if there is any deliberate deviation therefrom they are liable to be charged with misconduct in the shape of go-slow and may be dismissed for such misconduct. the minimum wages and the dearness allowance fixed by the major engineering awards are payable for production up to the quota and thereafter extra payments are made on piece-rate basis up to the norm and even beyond it where the workmen produce beyond the norm, The question that fails for consideration is whether such a system is typical production bonus system described in the case, of Bridge and Roof Company, 1962-2 Lab LJ 490