Court cases are piling up against moves by Bharat Petroleum Corporation Ltd (BPCL) to check litigation by employees on issues such as privatisation, wage settlement and employee stock purchase scheme ahead of the planned strategic disinvestment of the state-run oil company.

On Wednesday, Cochin Refineries Workers Association, filed a petition in the Kerala high court seeking a direction to quash the “restrictive clauses” in the employee stock purchase scheme (ESPS) that excludes workers litigating against the planned privatisation of the state-run company from its ambit, among other such pre-conditions.

The restrictions imposed are arbitrary, illegal, unsustainable and unconstitutional, the Association said in its petition.

The right to receive the stock or purchase the shares at discounted price is a right available to all employees. The condition that an employee should have put in 5 years’ service and the restriction imposed on employees who have challenged the proposed strategic disinvestment of the company and the embargo on making such a challenge in future are violative of Articles 14, 16, 19 and 21 of the Constitution of India. Moreover, the said restrictions are violative of the Securities and Exchange Board of India (share-based employee benefits) Regulation 2014, it has argued.

The ESOP regulations of SEBI stipulate that no scheme shall be offered to employees of a company unless its shareholdersapprove it by passing a special resolution in the general body meeting.

Besides, the explanatory statement to the notice and the resolution proposed to be passed by the shareholders for the scheme "shall include the information as specified by SEBI in this regard".

The notice, according to the Association, “does not contain the stipulation that an employee involved directly or indirectly in any litigation against Government of India or the company in connection with the proposed strategic disinvestment of the company will not be eligible and that they cannot challenge the disinvestment in future”.

Thus, the “restrictions were never placed before the general body meeting held on September 28” and hence have “not been approved by the general body”, thereby violating SEBI regulations, the Association alleged, adding that the restrictions “are not enforceable”.

The Association has sought directions from the court to BPCL “to provide the benefit of the ESPS to all employees of BPCL Kochi Refinery without enforcing the restrictions”.

A similar petition was filed jointly by four employees’ unions at the Mumbai refinery of BPCL a few days ago.

During the October 8 hearing on the petition, BPCL through its counsel said that the deadline for employees to submit proof of withdrawal from litigation/representation/complaint has been extended by a month to November 15.

Another union, the Petroleum Employees’ Union (PEU), the largest recognised union at BPCL, has separately filed a petition in the Mumbai high court seeking to quash a notice sent by the state-run oil company urging individual workers to sign the long term settlement (LTS) on wages offeredeven if their unions have not signed the wage agreement.