The Hindu Business Line : Termination of co-op staff without enquiry barred: HC

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Termination of co-op staff without enquiry barred: HC

Our Legal Correspondent

Chennai, Oct. 31 The TN Shops & Establishments Act, 1941 provided for relief to employees of co-operative institutions from being terminated from service without conducting proper enquiry, Madurai Bench of Madras High Court ruled.

Hearing cases from employees of a Madurai-based co-op bank challenging their dismissal, Bench held action of society was contrary to Section 41(2), inasmuch as employees were not given one month’s pay or pay in lieu of notice, and no reasonable cause was attached to their termination.

Mr Justice K. Chandru, while upholding order of appellate authority under said Act, ruled that termination was illegal on two grounds. One was ingredients of Section 41(2) were not complied with. Also, society’s contention that the 3 dismissed employees – S. Thirumalaikumaran, C. Periamayan and G. Soundararajan – were found to be surplus could not be accepted as there was no material before the authority.

The Judge pointed out that first respondent (Thirumalaikumaran) was restored into service pursuant to settlement under Section 12(3) of Industrial Disputes Act. By virtue of Section 18(3) of said Act, it was binding on Society, and it could not wriggle out of said settlement.

Petitioner – Thirupparankundram Co-op Primary Agricultural & Rural Development Bank Ltd – contended that under Shops Act, the employees could not raise plea of violation of provision of ID Act as they were retrenched under Section 25-F of ID Act.

Bench said that litigation was pending for three years, and considering fact that employees were out of job for six years, it would meet ends of justice if they were paid 50 per cent of back-wages. All of them would stand reinstated within four weeks.

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