No automatic back-wages for reinstated employee: SC

NEW DELHI: The Supreme Court has held that a reinstated employee is not entitled to any automatic award of back-wages as it should be decided taking into account the facts and situation of each case.

"Payment of full back-wages, upon an order of termination being declared illegal, cannot be granted mechanically.

"It does not automatically follow that reinstatement must be accompanied by payment of full back-wages even for the period when the workman remained out of service and contributed little or nothing to the industry," a bench of justices Tarun Chatterjee and Surinder Singh Nijjar said.

The apex court passed the judgement while modifying the order of an Allahabad High Court order which had directed M/S Reetu Marbles to pay a reinstated employee Prabhakant Shukla back-wages for 17 years.

The high court had passed the order setting aside the directions of the labour court which while directing reinstatement of the employee had, however, held that he was not entitled to any back-wages as he apparently would have been working elsewhere during the period in between the termination and reinstatement.

In this case, Shukla was engaged as an accountant between March 1, 1986 and June 11, 1987 after which he was removed from service. He was being paid a monthly of Rs 1,200 at the time of his termination.