TATA EMPLOYEES UNION Vs. UNION OF INDIA UOI

JUDGEMENT

(1.) In these batch of Original Petitions, the points raised for consideration are the same. The grievances voiced in the petitions are also identical. All the petitioners are aggrieved by the amendment made to the Employees State Insurance (Central) Rules, 1950 amending R.50,51 and 54 with effect from 1-4-1992 by notification dated 27th March, 1992, by which the wage ceiling for coverage under the Employees State Insurance Act (for short 'the Act') is enhanced from Rs.1,600/- per month to Rs.3,000/- per month and the rate of employers contribution with effect from 1-4-1992 is reduced at 4% of the wages payable to the employees instead of 5% and the employees' contribution is fixed at 1 1/2% of the wages payable instead of 21/4%. This amendment was given effect to from 1-4-1992. The Act and coverage were admittedly there even before the amendment was made The effect of the amendment is, persons who were getting wages, excluding remuneration for overtime work, in the region of Rs.1,600/- and above upto Rs.3,000/-per month were also required to be covered. It is on behalf of. these employees, who were receiving remuneration between Rs.1,600/-and Rs.3,000/-per month, these writ petitions were filed. Admittedly, persons who were getting wages upto Rs.1,600/- were covered under the Act even before 1 -4-1992 unless exemption was given to establishments in individual cases. The main ground for challenge in the writ petition is that these employees are getting better medical treatment and enjoying better medical facilities in the employer's establishments and, therefore, it is apprehended that those facilities will be lost to them if the Employees State Insurance Scheme is extended to them. Their further case is that they have to pay 1.5% of their salary by way of contribution. Admittedly, no such recoveries were made earlier as they were not covered under the Act. In an attempt to see that the coverage under the Act is not extended to the employees coming under the wage bracket of Rs.1,600/- to Rs.3,000/-, counsel representing the petitioners, the employees or their unions, advanced all possible arguments. It is contended that the notification amending R.50 enhancing the wage ceiling for coverage under the Act from Rs.1,600/- to Rs.3,000/- per month and reducing the employer's contribution from 5% to 4% and employees contribution from 2 1/4% to 11/2% etc. are illegal as there is no quid pro quo for the levy and collection of contribution. It is contended that the petitioners are getting better facilities under negotiated settlements from their employers and those benefits will be lost to them by the amendment and consequential coverage. This, it is contended, will amount to change of service conditions violating S.9Aof the Industrial Disputes Act. It was also contended that the rule is made in violation of S.95 without complying with the formalities. The Rule, it is stated, has not been placed before the Parliament. Petitioners contended that many of them have submitted representations before the State Insurance Corporation and the Regional Director for granting exemption from the coverage. But the rule is brought into force without disposing of their representations. The further contention is, if the rule is enforced, there will be two classes of employees under each management, one getting coverage under the Employees State Insurance Act and the other getting better facilities provided by the management, which, it is stated, will constitute violation of Art.14 of the Constitution of India. The action of the respondent in bringing the petitioners within the coverage was also claimed to be arbitrary. It is submitted that the Act itself is not applicable to the petitioners as they are enjoying substantially similar or superior benefit than the facilities provided under the Act. The benefits such as sickness, medical, maternity, disablement and dependant benefits received by the petitioners under the respective management are detailed in the petition in an attempt to say that they are enjoying benefits superior to those given under the Act. It is also contended that the Corporation cannot, by arbitrary action, deny the benefits enjoyed by them and thrust upon them the so called benefits under the Act and the Scheme. Some of the petitioners contended that bringing the employees compulsorily under the Act would be violative of Art.21 of the Constitution. These contentions were urged by counsel in an attempt to show that the amendment to R.50, 51 and 54 by notification dated 27-3-1992 enhancing the wage ceiling of employees for coverage under the Act from Rs.1,600/-to Rs.3,000/- with effect from 1-4-1992 is illegal and inoperative.

(2.) A counter affidavit has been filed by the Employees State Insurance Corporation in O.P.4707 of 1992 and it is agreed by all panics that the counter affidavit can be read as counter affidavit in all the cases where counter affidavit has not been filed on behalf of the Corporation.

(3.) The Corporation contended that for offsetting the erosion of money value and the consequent hike of wages from time to time, the wage ceiling for coverage has been enhanced. The Employees State Insurance Scheme was originally applicable to employees drawing Rs.400/-. It was, thereafter, enhanced to Rs.500/- and further to Rs.1000/- and again to Rs.1,600/- during the 'last 35 years. Because of the inflationary tendency of the economy and increase in the wage structure, a large number of employees got out of the coverage of the E.S.I. Scheme and hence, the ceiling had to be increased, to ensure continued coverage of the workmen earlier covered and to be on par or comparable with Employees Provident Fund Scheme. Counsel referred to the tripartite Committee set up to review the work of the E.S.I. Scheme. The review Committee set up by the order of the Government of India dated 29-1-1981 recommended upward revision of the upper income limit for coverage from time to time, to bring the employees under the coverage of the Employees State Insurance Scheme in line with the Employees Provident Fund. The Committee had representation from the central trade unions including INTUC, AITUC, HMS, etc. and also representative of employers and the State Governments. The wage ceiling for the purpose of Employees Provident Fund was increased to Rs.3,500/- with effect from 1-11-1990. The counter affidavit says that the Standing Committee of the Employees State Insurance Corporation at its meeting held on 5-3-1991, recommended to raise the ceiling to Rs.3,000/- without making any change in the rate of contribution. But the special meeting of the Corporation held on 8th October, 1991 made recommendation for raising the wage ceiling and also reducing contribution rate and consequential matters. The Corporation consisted of representatives of the employees and employers and of Central and State Governments. There are ten members representing the employees appointed in consultation with the recognised trade unions. The Corporation also consists of Members of the Parliament. The decision of the Government of India was taken as a result of the resolution passed by the Employees State Insurance Corporation after discussion. The Government of India, in the Gazette dated 3-12-1991, published a draft notification as required in S.95(l). It is also stated that the notification was placed before the Loksabha on 6th May, 1992 and the Rajyasabha on 7th May, 1992. Therefore, the amendment to the rule did not in any way resulted in violation of S.95 of the Act as contended by the petitioners.