2nd National ADR Competition

In the panel of Indian Council of Arbitration

Measures taken for the regularisation of casual employees as per Industrial

Employment (Standing Orders) Central rules, 1946 and The Contract Labour (Regulation and
Abolition) Act, 1970.

In the matter of

Trade Union --------------- Claimant

V.

Bread and Biscuits Manufacturing Company ------------------

Respondent

Memorandum on behalf of the Respondent

R
Table of Contents

1. General Introduction To ADR-----------------------------------

2. Briefing on ADR ----------------------------------------------------

3. Explanation of the Conciliation Method------------------------

4. Measure of Issues----------------------------------------------------

5. Advanced Arguments------------------------------------------------

6. Prayer---------------------------------------------------------------------
 GENERAL INTRODUCTION TO
“ALTERNATIVE DISPUTE RESOLUTION”

Definition
Alternative Dispute Resolution abbreviated as ADR, is a method or an instrument of resolving
disputes without litigation. Public courts may be asked to review the validity of ADR methods,
but they will rarely overturn ADR decisions and awards if the disputing parties formed a valid
contract to abide by them.

Overview
Alternative Dispute Resolution ("ADR") refers to any means of settling disputes outside of the
courtroom. ADR typically includes early neutral evaluation, negotiation, conciliation, mediation,
and arbitration. As burgeoning court queues, rising costs of litigation, and time delays continue
to plague litigants, more states have begun experimenting with ADR programs. The main
advantage of this form of dispute settlement is that it allows the parties themselves to control the
process and the solution.

Arbitration is more formal and resembles a simplified version of a trial involving limited
discovery and simplified rules of evidence (ex.hearsay is usually admissible in arbitration). The
arbitration is headed and decided by an arbitral panel or a single arbitrator, depending on the
agreement of the partiesThe concept of Alternative Dispute Resolution (ADR) mechanism is
capable of providing a substitute to the conventional methods of resolving disputes. ADR
offers to resolve all type of matters including civil, commercial, industrial and family etc.,
where people are not being able to start any type of negotiation and reach the settlement.
Generally, ADR uses neutral third party who helps the parties to communicate, discuss the
differences and resolve the dispute. It is a method which enables individuals and group to
maintain co-operation, social order and provides opportunity to reduce hostility.

ADR has proven successful in clearing the backlog of cases in various levels of the judiciary –
LokAdalats alone have disposed more than 50 lakh cases every year on average in the last three
years. The National and State Legal Services Authorities should disseminate more information
regarding these, so they become the first option explored by potential litigants. So, the National
Legal Services Day is celebrated on 9th November to spread awareness for ensuring reasonable
fair and justice procedure for all citizens. One of the objectives of Legal Services Authorities is
to promote settlements of disputes through Alternative Dispute Resolution (ADR) Mechanisms.

BRIEFING ON - ALTERNATIVE DISPUTE

RESOLUTION (ADR)
Introduction:
ADR is a mechanism of dispute resolution that is non adversarial, i.e. working together co-
operatively to reach the best resolution for everyone. ADR can be instrumental in reducing
the burden of litigation on courts, while delivering a well-rounded and satisfying
experience for the parties involved. It provides the opportunity to "expand the pie" through
creative, collaborative bargaining, and fulfill the interests driving their demands.

Arbitration and Conciliation Act, 1996-

Part I of this act formalizes the process of Arbitration and Part III formalizes the process of
Conciliation. (Part II is about Enforcement of Foreign Awards under New York and
Geneva Conventions.)

The Concept & its efficacy:

“It is the spirit and not the form of law that keeps the justice alive.” LJ Earl Warren

The concept of Conflict Management through Alternative Dispute Resolution (ADR) has
introduced a new mechanism of dispute resolution that is non adversarial.
New methods of dispute resolution such as ADR facilitate parties to deal with the underlying
issues in dispute in a more cost-effective manner and with increased efficacy. In addition, these
processes have the advantage of providing parties with the opportunity to reduce hostility,
regain a sense of control, gain acceptance of the outcome, resolve conflict in a peaceful
manner, and achieve a greater sense of justice in each individual case. The resolution of
disputes takes place usually in private and is more viable, economic, and efficient.

Importance of ADR in India

Alternative Dispute Resolution mechanism provides scientifically developed techniques to Indian
judiciary which helps in reducing the burden on the courts. ADR provides various modes of settlement
including, arbitration, conciliation, mediation, negotiation and lokAdalat. ADR is also founded on such
fundamental rights, article 14 and 21 which deals with equality before law and right to life and personal
liberty respectively. ADR’s motive is to provide social-economic and political justice and maintain
integrity in the society enshrined in the preamble. ADR also strive to achieve equal justice and free legal
aid provided under article 39-A relating to Directive Principle of State Policy(DPSP).

Few important provisions related to ADR

1.Section 89 of the Civil Procedure Code, 1908 provides that opportunity to the people, if it
appears to court there exist elements of settlement outside the court then court formulate the
terms of the possible settlement and refer the same for: Arbitration, Conciliation, Mediation or
LokAdalat.

2.The Acts which deals with Alternative Dispute Resolution are Arbitration and Conciliation
Act, 1996 and,

3.The Legal Services Authority Act, 1987

Advantages of Alternative Dispute Resolution

 Less time consuming: people resolve their dispute in short period as compared to
courts
  Cost effective method: it saves lot of money if one undergoes in litigation process.

 It is free from technicalities of courts, here informal ways are applied in resolving
dispute.

 People are free to express themselves without any fear of court of law. They can
reveal the true facts without disclosing it to any court.

 Efficient way: there are always chances of restoring relationship back as parties
discuss their issues together on the same platform.

 It prevents further conflict and maintains good relationship between the parties.

 It preserves the best interest of the parties.

Various modes of Alternative Dispute Resolution

Arbitration
The process of Arbitration cannot exist without valid arbitration agreement prior to the
emergence of dispute. In this technique of resolution parties refer their dispute to one or more
persons called arbitrators. Decision of arbitrator is bound on parties and their decision is called
‘Award’. The object of Arbitration is to obtain fair settlement of dispute outside of court without
necessary delay and expense.Any party to a contract where arbitration clause is there, can invoke
arbitration clause either himself or through their authorized agent which refer the dispute directly
to the arbitration as per the Arbitration clause.Section 8 of Arbitration and Conciliation Act,
1996 provides that if any party disrespects the arbitral agreement and instead of moving to
arbitration, moves that suit to civil court, other party can apply the court for referring the matter
to arbitration tribunal as per the agreement but not later the submission of the first statement. The
application must include a certified copy of arbitration agreement and if courts satisfy with it, the
matter will be referred to arbitration.
Mediation
Mediation is an Alternative Dispute resolution where a third neutral party aims to assist two or
more disputants in reaching agreement. It is an easy and uncomplicated party centered
negotiation process where third party acts as a mediator to resolve dispute amicably by using
appropriate communication and negotiation techniques. Mediator’s work is just to facilitate the
parties to reach settlement of their dispute. Mediator doesn’t impose his views and make no
decision about what a fair settlement should be. It is the best possible outcome both the party
come up with or has in mind. Its suitable situation as each party thinks about their most favorable
scenario looks like. For a successful negotiation the result always lies in the middle, mediator
after considering both the parties comes up with most likely outcome. Here result is not always
in the middle but little left or right of the center depending on negotiation situation

Conciliation

Conciliation is a form of arbitration but it is less formal in nature. It is the process of facilitating
an amicable resolution between the parties, whereby the parties to the dispute use conciliator
who meets with the parties separately to settle their dispute. Conciliator meet separately to lower
the tension between parties, improving communication, interpreting issue to bring about a
negotiated settlement. There is no need of prior agreement and cannot be forced on party who is
not intending for conciliation. It is different from arbitration in that way.

Actually, it is not possible for the parties to enter into conciliation agreement before the dispute
has arisen. It is clear in Section 62 of The Arbitration and Conciliation Act, 1996 which
provides-

 The party initiating conciliation shall send to the other party a written invitation to
conciliate under this part, briefly identifying the subject of the dispute.

 Conciliation proceedings shall commence when the other party accepts in writing the
invitation to conciliate.

 If the other rejects the invitation, there will be no conciliation proceedings.

Above provision clearly states conciliation agreement should be an extemporary agreement
entered into after the dispute has but not before.
Negotiation

Negotiation is a dialogue intended to resolve disputes, to produce an agreement upon courses of

action, to bargain for individual or collective advantage, or to craft outcomes to satisfy various
interests. It is the primary method of alternative dispute resolution.
Negotiation occurs in business, non-profit organizations, government branches, legal
proceedings, among nations and in personal situations such as marriage, divorce, parenting, and
everyday life. The study of the subject is called negotiation theory. Those who work in
negotiation professionally are called negotiators. Professional negotiators are often specialized,
such as union negotiators, leverage buyout negotiators, peace negotiators, hostage negotiators, or
may work under other titles, such as diplomats, legislators or brokers

LokAdalat

“While Arbitration and Conciliation Act, 1996 is a fairly standard western approach towards
ADR, the LokAdalat system constituted under National Legal Services Authority Act, 1987 is a
uniquely Indian approach”.

LokAdalat is called ‘People’s Court’ presided over by a sitting or retired judicial officer, social
activists or members of Legal profession as the chairman. National Legal Service
Authority(NALSA) along with other Legal Services Institutions conducts LokAdalats on regular
intervals for exercising such jurisdiction. Any case pending in regular court or any dispute
which has not been brought before any court of law can be referred to LokAdalat. There is no
court fees and rigid procedure followed, which makes the process fast. If any matter pending in
court of referred to the LokAdalat and is settled subsequently, the court fee originally paid in the
court when the petition filed is also refunded back to the parties.

Parties are in direct interaction with the judge, which is not possible in regular courts. The
persons deciding the cases have the role of statutory conciliators only, they can only persuade the
parties to come to a conclusion for settling the dispute outside the regular court in the LokAdalat.
Legal Services Authorities (State or District) as the case may be on receipt of an application from
one of the parties at a pre-litigation stage may refer such matter to the LokAdalat for which
notice would then be issued to the other party. LokAdalats do not have any jurisdiction to deal
with cases of non-compoundable offenses.

EXPLANATION OF THE CONCILIATION METHOD

The law relating to conciliation has been codified for the first time in India on the pattern of
UNCITRAL Conciliation Rules. Conciliation is a less formal form of arbitration which does not
require an existence of any prior agreement. Part 3 of the Arbitration and Conciliation Act deals
with conciliation.

Application And Scope- Section 61

1. This part shall apply to conciliation of disputes arising out of legal relationship, whether
contractual or not and to all proceedings.
2. This part shall not apply where by virtue of any law for the time being in force certain
disputes may not be submitted to conciliation.

Section 61 points out that the process of conciliation extends, in the first place, to
disputes, whether contractual or not. But the disputes must arise out of legal relationship.
It means that the dispute must be such as to give one party the right to sue and other party
the liability to be sued. The process of conciliation extends, in the second place, to all
proceedings relating to it. But Part 3rd of the Act does not apply to such disputes as
cannot be submitted to conciliation by virtue of any law for the time being in force.

Number And Qualifications of Conciliators- Section 63

Section 63 fixes the number of conciliators. There shall be one conciliator. But the parties may
by their agreement provide for two or three conciliators. Where the number of conciliators is
more than one, they should as a general rule act jointly.
Appointment of Conciliators- Section 64

1. If there is one conciliator in a conciliation proceeding, the parties may agree on the name of a
sole conciliator.
2. If there are two conciliators in a conciliation proceeding, each party may appoint one
conciliator.
3. If there are three conciliators in a conciliation proceeding, each party may appoint one
conciliator and the parties may agree on the name of the third conciliator who shall act as the
presiding conciliator.

Sub- section (2) of section 64 provides for the assistance of a suitable institution or person in the
appointment of conciliators. Either a party may request such institution or person to recommend
the names of suitable individuals to act as conciliators, or the parties may agree that the
appointment of one or more conciliators be made directly by such institution or person.

Procedure of Conciliation

1. Commencement of conciliation proceedings – Section 62

The conciliation proceedings are initiated by one party sending a written invitation to the other
party to conciliate. The invitation should identify the subject of the dispute. Conciliation
proceedings are commenced when the other party accepts the invitation to conciliate in writing.
If the other party rejects the invitation, there will be no conciliation proceedings. If the party
inviting conciliation does not receive a reply within 30 days from the date he sends the
invitation, he may elect to treat this as rejection of the invitation to conciliate. If he so elects he
should inform the other party in writing.

2.Submission of statements to conciliator – Section 65

The conciliator may request each party to submit to him a brief written statement. The statement
should describe the general nature of the dispute and the points at issue. Each party should send a
copy of such statement to the other party. The conciliator may require each party to submit to
him a written statement of his position and the facts and grounds in its support. It may be
supplemented by appropriate documents and evidence. The party should send a copy of such
statements, documents and evidence to the other party.
 3.Conduct of conciliation proceedings – Section 69(1), 67(3)
The conciliator may invite the parties to meet him. He may communicate with the parties orally
or in writing. He may meet or communicate with the parties together or separately. (Sec 69(1)).In
the conduct of conciliation proceedings, the conciliator has some freedom. He may conduct them
in such manner as he may consider appropriate. But he should take into account the
circumstances of the case, the express wishes of the parties, a party’s request to be heard orally
and the need of speedy settlement of dispute. (Sec 67(3)).

4.Administrative assistance – Section 68

Section 68 facilitates administrative assistance for the conduct of conciliation proceedings. The
parties and the conciliator may seek administrative assistance by a suitable institution or the
person with the consent of the parties.

Settlement
1.Settlement of dispute – Sec 67(4), 72, 73
The role of the conciliator is to assist the parties to reach an amicable settlement of the dispute.
He may at any stage of the conciliation proceedings make proposals for the settlement of the
dispute. Such proposals need not be in writing and need not be accompanied by a statement of
reasons. (Sec. 67(4)) Each party may, on his own initiative or at the invitation of the conciliator,
submit to the conciliator the suggestions for the settlement of the dispute. (Sec. 72)
When it appears to the conciliator that there exist elements of a settlement likely to be accepted
by the parties, he shall formulate the terms of a possible settlement and submit them to the
parties for their observations. After receiving the observations of the parties, the conciliator may
reformulate the terms of a possible settlement in the light of such observations. (Sec 73(1)) If the
parties reach agreement on the settlement of a dispute, a written settlement agreement will be
drawn up and signed by the parties.
If the parties request, the conciliator draw up or assist the parties in drawing up the settlement
agreements. (Sec 73(2)) When the parties have signed the settlement agreement, it becomes final
and binding on the parties and persons claiming under them. (Sec 73(3)) The conciliator shall
authenticate the settlement agreement and furnish its copy to each of the parties. (Sec 73(4)
2.Status and effect of settlement agreement – Sec 74
Section 74 provides that the settlement agreement shall have the same status and effect as an
arbitral award on agreed terms under Section 30. This means that it shall be treated as a decree of
the court and shall be enforceable.

Restrictions on Role of Conciliator – Section 80

Section 80 places two restrictions on the role of the conciliator in the conduct of conciliation
proceedings:

1. Clause (a) of Section 80 prohibits the conciliator to act as an arbitrator or as a

representative or counsel of a party in any arbitral or judicial proceeding in respect of a
dispute which is subject of the conciliation proceedings.
2. Clause (b) of Section 80 prohibits the parties to produce the conciliator as a witness in
any arbitral or judicial proceedings.

Termination of Conciliation Proceedings – Section 76

Section 76 lays down four ways of the termination of conciliation proceedings. These are:

1. The conciliation proceedings terminate with the signing of the settlement agreement by
the parties. Here the date of termination of conciliation proceedings is the date of the
settlement agreement. (Sec 76(a))
2. The conciliation proceedings stand terminated when the conciliator declares in writing
that further efforts at conciliation are no longer justified. Here the date of termination of
conciliation proceedings is the date of the declaration. (Sec 76(b))
3. The conciliation proceedings are terminated by written declaration of the parties
addressed to the conciliator to the effect that the conciliation proceedings are terminated.
Here the date of termination of conciliation proceedings is the date of the declaration.
(Sec 76(c))
4. The conciliation proceedings are terminated when a party declares in writing to the other
party and the conciliator, that the conciliation proceedings are terminated. Here the date
of termination of conciliation proceedings is the date of the declaration. (Sec 76(d))
Resort To Arbitral or Judicial Proceedings – Sec 77

As a general rule, the parties cannot initiate arbitral or judicial proceedings during the conciliation
proceedings in respect of a dispute which is the subject matter of the conciliation proceedings. But in
exceptional cases a party may initiate arbitral or judicial proceedings if in his opinion such
proceedings are necessary for preserving his rights.

Costs – Sec 78
Costs means reasonable costs relating to the following:

1. The fee and expenses of the conciliator and witness requested by the conciliator with the
consent of the parties
2. Any expert advice requested by the conciliator with the consent of the parties
3. Any assistance provided to sec 64(2)(b) and sec 68
4. Any other expenses incurred in connection with the conciliation proceedings and the
settlement agreement. (Sec 78(2)) .

It is the conciliator who fixes the costs of the conciliation proceedings upon their
termination and gives written notice of it to the parties. (Sec78 (1)) The costs are borne
by the parties in equal shares. (Sec 78(3))

Deposits – Sec 79

The conciliator may estimate the costs likely to be incurred and direct each party to deposit it in
advance in an equal amount. During the conciliation proceedings, the conciliator may demand
supplementary deposits from each party. If the require deposits are not paid in full by both parties
within 30 days, the conciliator may either suspend the proceedings or terminate the proceedings
by making a written declaration to the parties.

The termination of proceedings become effective from the date of declaration. Upon termination
of the proceedings, the conciliator shall render to the parties accounts of deposits received and
return the unexpected balance to the parties.
Case Laws Relating To Conciliation
1. HareshDayaram Thakur v. State of Maharashtra and Ors1.

While dealing with the provisions of Sections 73 and 74 of the Arbitration and
Conciliation Act of 1996 in paragraph 19 of the judgment as expressed thus the court
held that-
From the statutory provisions noted above the position is manifest that a conciliator is a
person who is to assist the parties to settle the disputes between them amicably.

For this purpose the conciliator is vested with wide powers to decide the procedure to be
followed by him untrammelled by the procedural law like the Code of Civil Procedure or
the Indian Evidence Act, 1872.

When the parties are able to resolve the dispute between them by mutual agreement and it
appears to the conciliator that their exists an element of settlement which may be
acceptable to the parties he is to proceed in accordance with the procedure laid down in
Section 73, formulate the terms of a settlement and make it over to the parties for their
observations; and the ultimate step to be taken by a conciliator is to draw up a settlement
in the light of the observations made by the parties to the terms formulated by him.

The settlement takes shape only when the parties draw up the settlement agreement or
request the conciliator to prepare the same and affix their signatures to it. Under Sub-
section (3) of Section 73 the settlement agreement signed by the parties is final and
binding on the parties and persons claiming under them.

It follows therefore that a successful conciliation proceedings comes to end only when
the settlement agreement signed by the parties comes into existence. It is such an
agreement which has the status and effect of legal sanctity of an arbitral award under
Section 74.

1 . AIR 2000 SC 2281

 2. Mysore Cements Ltd. V. SvedalaBarmac Ltd.2

It was said that Section 73 of the Act speaks of Settlement Agreement. Sub-section (1)
says that when it appears to the Conciliator that there exist elements of settlement which
may be acceptable to the parties, he shall formulate the terms of a possible settlement and
submit them to the parties for their observation. After receiving the observations of the
parties, the Conciliator may reformulates the terms of a possible settlement in the light of
such observations.

In the present case, we do not find there any such formulation and reformulation by the
Conciliator, under Sub- section (2), if the parties reach a settlement agreement of the
dispute on the possible terms of settlement formulated, they may draw up and sign a
written settlement agreement. As per Sub-section (3), when the parties sign the
Settlement Agreement, it shall be final and binding on the parties and persons claiming
under them respectively. Under Sub-section (4), the Conciliator shall authenticate the
Settlement Agreement and furnish a copy thereof to each of the parties. From the
undisputed facts and looking to the records, it is clear that all the requirements of Section
73 are not complied with.

Conclusion :

The process of conciliation as an alternate dispute redressal mechanism is advantageous

to the parties in the sense that it is cost effective and expeditious, it is simple, fast and
convenient then the lengthy litigation procedure and it eliminates any scope of biasness
and corruption.The parties who wish to settle their disputes they can be provided great
intensive by the process of conciliation. In order to enable the conciliator to play his role
effectively ,the parties should be brought together face to face at a common place where
they can interact face to face and with the conciliator, separately or together without any
distraction and with only a single aim to sincerely arrive at the settlement of the dispute.

2 AIR 2003 SC 3493

 Conciliation is a boon and it is a better procedure to settle any dispute as in this process it
is the parties who by themselves only come to the settlement of the dispute and the role
of the conciliator is to bring parties together and to make an atmosphere where parties
can themselves resolve their disputes. Conciliation tries to individualize the optimal
solution and direct parties towards a satisfactory common agreement. In conciliation, the
conciliator plays a relatively direct role in the actual resolution of a dispute and even
advises the parties on certain solutions by making proposals for settlement.

Measure of issue
A.Does the issue held by the trade union fall under into the scope of ADR, Is not the disputes relating to
labour and employment is exempted from the jurisdiction of ADR.

B.Is the issue not for a an casual employee of the company which is , turned into an issue for the trade
union.

C.Does the company , which is has earned a stature of being a public utility service , wrong in following
the Government notification.

D.Does the casual employees have the relevant skillset and qualification to be in the position of
permanent employees.

E.Does the casual workers did not know that they were recruited on Ad- basis and the they don’t have any
terms or agreement with the company.

F.Does the promotion and recruitment of a company is not governed by the sacred rules of recruitment, If
casual and permanent workers are to be in the same footing then why on the first place the position of
casual workers being created by the organisationinspite of having permanent and temporary positions.

G.In some cases the Supreme Court have ruled in favour of the claimants / appelellents for seeking
regularisation but in that case has the Supreme Court laid down any guidelines .
Arguments Advanced
The respondent would state that the management has employed about 950 workmen made up of
permanent, temporary and casual employees, depending upon the exigencies of business
availability of raw material and capacity constraints. During the beginning the management had
successfully took up demands from the Union for regularisation of the casual employees, with
the Management. But at present, the Management would like to express its inability on various
grounds to regularise its casual employees. The Management has realised that there is no scope
for making these casual employees permanent employees in view of the important fact that its
raw material requirements arere not available in accordance with business requirements of the
Management and that even as it is, there is a surplus labour force. Further, the policy of the
Government of India, to restrict the manufacturing and preparation of products made by the
Company in its various factories, put constraints upon the Management to go in for more
production. In present scenario the claimant demands that the services of the casual employees
should be made permanent. The Management pleads its inability to do so due to various
circumstances and one among them is the policy of the Central Government restricting the
manufacture of products by the Company.
The management would like to further claim that the workmen with the designation of
permanency on the one hand and those of casual on the other, were selected only after records
of past service, attendance and efficiency were looked into. Moreover it is further submitted
that the question of permanency of the workmen should be considered in the light of the
production capacity of the unit, manpower requirements etc. and it is clearly found that the
services of casual workmen are not required by the Company as regular and so it can be agreed
between the Management and the Union that these workmen can be paid a slightly higher wage
and if it agrees to, the management shall determine the percentage increase and the added
benefits and shall submit a report to the union representative.
Adjudication of labour and industrial claims outside the courts and tribunals are constituted by
the reference and resolution of arbitration that would have to be governed by the specific
provisions of the Industrial Disputes Act, 1947 and not the Arbitration and conciliation Act,
1996. The said precedent have been laid in various High Courts. The Courts have concluded
that there are strong and compelling public policy reasons to ensure that labour and industrial
disputes would have to be in conformity with the procedure of the industrial disputes acts, 1947
and not under the Arbitration and Conciliation act. In a decision upheld by the Madras High
Court in the case of C.Murugan v Tamil Nadu Supply and Drainage Board, held granting of
permanent employee status to casual labours based on the order of the Labour court would
become an illegal channel of appointment & amount to violation of constitutional provisions
including reservation.A division bench of the Kerala High Court at has directed the Chief
Secretary to issue in three weeks instructions to all government departments, statutory bodies,
including local-self-government institutions, government companies, statutory corporations and
institutions like the Institute of Human Resources Development controlled by the government
not to regularize temporary employees.
The criteria for making a workman permanent has been spelt out by various guidelines adopted
by the companies issued by the management. It is submitted on behalf of the management that
after taking all these criteria into consideration alongwith the profits of the company, casual
employees are hired. 'Casual employment' as implied by the term, itself comes to an end at the
end of each day of casual work and they are not bound to report for work the following day nor
was the company is bound to accept their services. The number of casual workers employed
per day depend upon the daily requirement arising out of the absence of permanent workmen
and as per exigencies. Further, as per the Murray’s dictionary , "Casual" has been defined as
"one who is engaged on work of a casual nature or to fill a vacancy arising out of a casual
nature or to fill a vacancy arising out of unforeseen circumstances and is ordinarily employed
on a day-to-day basis." there is no question of a particular workmen becoming senior to the
other and demand regularisation.
Even apart from these averments, the management would like to specifically stated that it has
the right of retrenchment under the ID Act and if it can discharge on the basis of various
materials and criteria envisaged for discharging the workmen. The company having moral
values has decided not to retrench but that does not impliedly denote it is willing to grant
permanency under the present circumstances. If the claimant disagrees than it shall lead to
more conciliation proceedings which would eventually hamper the employer- employee relation
moreand more.The management further claims that we have dealt with this principles of
employment and the rights and duties of an employer and we do not think it necessary to mulct
our decisions since identical decisions on this subject can be witnessed from the past example.
The fact remains that in the present state of our country's economy the number of jobs are
limited. Hence, everybody cannot be given a job, despite our earnest desire. Jobs are created
when the economy is rapidly expanding, which means when there is rapid industrialization. But
unemployment in our country is increasing, and has become massive and chronic. These are the
social and economic realities of the country which cannot be ignored. Giving appointments
means adding extra financial burden to the national exchequer. Money for paying salaries to
such appointees does not fall from the sky, and it can only be realized by imposing additional
taxes on the public or taking fresh loans, both of which will only lead to additional burden on
the people. No doubt, in some decisions the Supreme Court has directed regularization of
temporary or ad hoc employees but it is well settled that a mere direction of the Supreme Court
without laying down any principle of law is not a precedent.
As per Sec 3 (f) Industrial Disputes Act – ''If, in the opinion of the State Government, it is
necessary or expedient so to do for securing the public safety or convenience, or the
maintenance of public order or supplies and services essential to the life of the community, or
for maintaining employment, it may by general or special order, make provision- for exercising
control over any public Utility service or any subsidiary undertaking, by authorising any person
(hereinafter referred to as the authorised controller) to exercise, with respect to such service,
undertaking or part thereof such functions of control as may be specified in the order; and, on
the making of such order the service, undertaking or part, as the case may be, shall so long as
the order continues to be carried on in accordance with any directions given by the authorised
controller in accordance with the provisions of the order and every person having any functions
of management of such service, undertaking or part thereof shall comply with such directions”.
In the Basti Sugar Mills case 3it was urged before the Supreme Court that Clause (b) will not
only apply where an industrial dispute has arisen, and in that case the State Government can take
action under Clause (d) alone.

While directing that appointments, temporary or casual, be regularised or made permanent, the
courts are swayed by the fact that the person concerned has worked for some time and in some
cases for a considerable length of time. It is not as if the person who accepts an engagement
either temporary or casual in nature, is not aware of the nature of his employment. A total

3 AIR 1961 SC 420

embargo on such casual or temporary employment is not possible, given the exigencies of
administration and if imposed, would only mean that some people who at least get employment
temporarily, contractually or casually, would not be getting even that employment when securing
of such employment brings at least some succour to them. It is in that context that one has to
proceed on the basis that the employment was accepted fully knowing the nature of it and the
consequences flowing from it. The claim acquired by him in the post in which he is temporarily
employed or the interest in that post cannot be considered to be of such a magnitude as to enable
the giving up of the procedure established, for making regular appointments to available posts in
the services of the State. The argument that since one has been working for some time in the
post, it will not be just to discontinue him, even though he was aware of the nature of the
employment when he first took it up, is not one that would enable the jettisoning of the
procedure established by law for public employment and would have to failtested when tested on
the touchstone of constitutionality and equality of opportunity enshrined in Article 14 of the
Constitution.

In Harish Vasudie vs. Union of India and Ors., the management would like to respond to the
claimant’s contention of equality as envisaged in our constitution and it is clear that adherence to
the rule of equality in public employment is a basic feature of our Constitution and since the rule
of law is the core of our Constitution, and a companyc would certainly be disabled from doing
anything upholding a violation of Article 14 or in overlooking of the need to comply with the
requirements of Article 14 read with Article 16 of the Constitution. Therefore, consistent with
the scheme for public employment, the management, necessarily holds that unless the
appointment is in terms of the relevant rules and after a proper competition among qualified
persons, the same would not confer any right on the appointee. If it is a contractual appointment,
the appointment comes to an end and the end of the contract, if it were an engagement or
appointment on daily wages or casual basis, the same would come to an end when it is
discontinued. Similarly, a casual employee could not claim to be made permanent on the expiry
of his day. It has also to be clarified that merely because a casual wage worker is continued for a
time beyond the term of his appointment, he would be entitled to be absorbed in regular service
or made permanent, merely on the strength of such continuance. It is very open that ad hoc
employees who by the very nature of their appointment, do not acquire any right. The panel,
should not ordinarily issue directions for absorption, regularization, or permanent continuance
unless the recruitment itself is necessary for the benefit of the company.. The panel needs to be
careful in ensuring that they do not interfere unduly with the economic arrangement of the
company’s affairs by the State or its instrumentalities or lend themselves the instruments to
facilitate the bypassing of the constitutional and statutory mandates that can b e detrimental to
the interests of the company in the present scenario as the company is a recognized PUS and it is
just abiding by the guidelines instituted by the state.

A contractual appointment, comes to an end at the end of the contract, if it were an engagement
or appointment on daily wages or casual basis, the same would come to an end when it is
discontinued. It has also to be clarified that merely because a temporary employee or a casual
wage worker is continued for a time beyond the term of his appointment, he would not be
entitled to be absorbed in regular service or made permanent, merely on the strength of such
continuance, if the original appointment was not made by following a due process of selection as
envisaged by the relevant rules. It is not open to the Court to prevent regular recruitment at the
instance of temporary employees whose period of employment has come to an end or of ad hoc
employees who by the very nature of their appointment, do not acquire any right.

It is well-known how before the days of collective bargaining labour was at a great disadvantage
in obtaining reasonable terms for contract of service from his employer. As trade unions
developed in the country and collective bargaining became the rule, the employers found it
necessary and convenient to deal with the representatives of workmen, instead of individual
workman, not only for the making or modification of contracts but also in the matter of taking
disciplinary action against one or more workmen and as regards all other disputes.The union or
those work men who have by their sponsoring turned the individual dispute into an industrial
dispute can, therefore, claim to have a say in the conduct of the proceedings before the tribunal.
Prayer

In light of the facts and circumstances of the case, as mentioned above, the Respondent,
therefore, most respectfully prays before the Panel to make any amicable settlement which is
beneficial for the company under the present circumstance complying with the appeal of the
Claimant.

All of which is most humbly prayed.