Charge-Sheet – Procedure for serving the same
There is a common tendency amongst the suspended and or charge sheeted
employee/workman that they try to evade the service of the charge-sheet when sent by Registered/Speed Post, Courier, Email, Whats app or SMS. In fact in
such cases, the Charge-Sheet should be published in the local leading
newspaper/s as held by Supreme Court.
In another case, the SC has held that the publication of a charge-sheet or a
show-cause notice in the news paper which is not known to be popular in the
area, will not be sufficient and the initiation of disciplinary proceedings
upon such defective service will be treated as BAD IN LAW. When rules
provide that charge-sheet should be serviced either by Registered Post or by Publication, then pasting it on the door of residence of delinquent employee
will not be proper.
EPF pension case: PF members don’t automatically become eligible under EPS, EPFO tells Supreme Court.
The Employees Provident Fund Organisation (EPFO) on Tuesday told the Supreme Court of India the structure of Employee Provident Fund Scheme (EPFS) and Employee Pension Scheme (EPS) is entirely different.
EPFO, appearing through Senior Advocate Aryama Sundaram made the submission before Justices UU Lalit, Aniruddha Bose and Sudhanshu Dhulia. The Bench was hearing a batch of appeal pleas filed by the Employees Provident Fund Organization (EPFO) in the issue related to payment of EPF pension to employees in proportion to their salary.
The appeals were specifically challenging the judgments of Kerala, Delhi and Rajasthan High Courts which had quashed the 2014 Amendment Scheme.
The Kerala High Court, in 2018, had set aside Employee’s Pension (Amendment) Scheme, 2014 that capped maximum pensionable salary to Rs.15, 000 per month, observing that it is unrealistic and would deprive most of the employees of a decent pension in their old age. Last year, a 2-judge bench of the Supreme Court had referred the appeals to a 3-judge bench to consider the following issues :
1. Whether there would be a cut-off date under paragraph 11(3) of the Employees’ Pension Scheme and
2. Whether the decision in R.C. Gupta v. Regional Provident Fund Commissioner (2016) would be the governing principle on the basis of which all these matters must be disposed.
Arguments of EPFO on Tuesday
Referring to the EPFO’s written arguments, Sundaram, assisted by Advocate Siddharth, submitted that Kerala High Court’s judgment overlooks the distinction between the structure of Employees Provident Fund Scheme (EPFS) and Employees Pension Scheme(EPS).
“It(HC) incorrectly assumes that all members of the EPF must inevitably be entitled to all benefits of the Pension Fund. This is incorrect. In EPF, employees and employers’ contributes a cumulative in the individual account, and consequently determines the benefits mainly the Provident Fund Cumulation. But EPS is meant for weaker section of the Indian workforce whose contributions are inadequate to yield proper retirement benefits. Therefore, the benefits therein, is defined in advance and consequentially, the rate of contribution is determined annually. The impugned judgement overlooks this important difference and declares it all members of the EPFS who are contributing above the base threshold EPFS, are entitled to the contribute above the base threshold in EPS and consequentially draw pension on the basis of such higher contributions. Further, it also ignores that the contributions in EPS must be made contemporaneously… and permits former members of the EPS to offer retrospective contributions.”
During the hearing, Sundaram primarily argued that employees drawing salary above the threshold of Rs 15,000 per month can be entitled to the Pension only if they make contributions after making a joint application with the employer within the cut-off period.
“What they (the respondents) are seeking is that they did not contribute every month, and after the lapse of 10, 20 or 30 years, whatever they have not paid that that point in time, you please take that now in one go and fix my pension. Such kind of an arrangement is not permitted under the scheme”, Sundaram submitted.
Further, Sundaram submitted that there are two necessary aspects with regard to EPS.
“First is that the option must be exercised by both employer and employee. In this case, employee does not exercise the option even prior to 2014 Amendment. Two, there must a remitting of money into the Pension Fund within 15 days. Why do you do with a person who does not exercise this option?…..The (Kerala) High Court says no-no and strikes down the Amendment. And applying the proviso, gave it to people who did not opt at that time and gave them the right to opt later. (It said that) opting is not necessary because Pension Fund is a necessary corollary of the Provident Fund. According to High Court you are a member of the provident fund, then ipso facto, you are member of the Pension Fund…..”
“While I want to show that the Amendment is correct, even without the 2014 Amendment, the Kerala High Court Judgement is wrong”, Sundaram submitted.
Sundaram argued that under the Provident Fund Scheme, the contributions made by the employer and the employees during the employment of the employee would be paid over to the employee along with interest accrued thereon at the time of their retirement. So, the obligation on the part of the operators of the Provident Fund Scheme would come to an end, after the retirement of the employee.
On the other hand, the obligation under the Pension Scheme would begin after the employee retired.
Also, it would be for the operators of the Pension Scheme to invest amount deposited in such a way that after the retirement the invested amount would keep on giving sufficient returns so that the pension would be paid to the employee not only during his life time but even to his family members after his death.
HC orders will create great imbalance
Sundaram submitted that allowing pension for employees who draw salary above the threshold rate will create great imbalance with the pension fund. If such employees are allowed to draw pension proportionate to the salary, the purpose of the pension fund, which is to protect the interests of employees who are in the low-salary segment, will get defeated.
During the hearing, the bench posed queries to Sundaram regarding the scheme of the 2014 amendment. He explained that the newcomers after the 2014 amendment are not entitled to pension if the monthly salary is above Rs 15,000. As regards existing employees who draw salary above the threshold, they are entitled to EPF pension only if they exercise the option within the cut-off dates and make contributions.
“The rationale is that EPS is meant to ensure a minimum of guaranteed retiral benefits to the vulnerable members of EPFS”, he said.
Sundaram said that there is no petition filed by a new-comer challenging the denial of pension and the petitions are filed by those who were members at the time of 2014 amendment and most of them have not even made their contributions to EPS.
The senior counsel submitted that the 2014 amendments were brought on the basis of sufficient materials from accounting experts showing the imbalance created within the fund and the Courts could not have second-guessed the expert opinion. There is no issue of discrimination as the classification is based on an intelligible differentia which has a nexus with a rational objective, he emphasised.
As the hearing moved to a close, the Bench told Sundaram that he would be allowed to make further submissions, if any, by way of a rejoinder. The Bench also asked the other counsel to wrap up their submissions in a time-bound manner, the coming days.
“You (Union of India) please finish your arguments by 1 pm”, the Bench said.
The Union of India is expected to make arguments today in the matter.
EPF Pension Case: Timeline
In 2019, a three-Judge Bench comprising the then CJI Ranjan Gogoi, Justice Deepak Gupta and Justice Sanjiv Khanna had dismissed the Special Leave Petition filed against a Kerala High Court Judgment setting aside Employee’s Pension (Amendment) Scheme, 2014 that capped maximum pensionable salary to Rs.15, 000 per month.
The Kerala High Court, while setting aside the 2014 amendments by its 2018 judgment, had declared that all the employees shall be entitled to exercise the option stipulated by paragraph 26 of the EPF Scheme without being restricted in doing so by the insistence on a date.
Further, the High Court had also set aside the orders issued by the EPFO declining to grant opportunities to the employees to exercise a joint option to remit contributions to the Employees Pension Scheme on the basis of the actual salaries drawn by them.
In April 2019, the Supreme Court had dismissed the special leave petition filed by the EPFO against the Kerala High Court’s judgment, through a summary order.
Later, in January 2021, a three-judge bench recalled the dismissal order in the review petitions filed by the EPFO and posted the matters for hearing in open court.
On February 25, 2021, the division bench of Justice UU Lalit and Justice KM Joseph restrained the High Court of Kerala, Delhi and Rajasthan from initiating contempt proceedings against the Central Government and the EPFO over the non-implementation of the HC verdicts.
Case Title: EPFO vs Sunil Kumar and Ors
Read MoreTDS to apply on interest earned/accrued on PF contributions (EE share) exceeding Rs. 2.50L per annum-wef FY 2021-22
The interest earned on the Employee PF contribution on the amount above Rs. 2.5 lakh w.e.f. 01/4/2021 shall be chargeable to tax, i.e. if Contribution is more than 2.5 lakhs per annum, the interest amount earned on the Employee PF contribution above Rs.2.5 lakh shall be taxable.
The past accumulated balance is safe and no tax on it. Moreover, the interest earned on such accumulation will not be chargeable to tax. The new proviso is on the interest earned by Employees’ PF contribution above 2.5 Lakh a year will now be taxed.
The Employer’s contribution is not part of this clause. Thus, only the Employee share of contribution of above Rs. 2.5 lakhs per annum is liable for TDS. The EPFO has issued a detailed circular dt. 05/04/22, discussing about various provisions including case scenarios and FAQs and a flow chart as to how the tax treatment would be given to the interest portion earned on the annual contributions exceeding 2.5L. Copy attached.
Read MoreWe are in talks with HR Heads of Companies on Wage Code: Labour Minister Bhupender Yadav.
According to Labour and Employment Minister Bhupender Yadav, India’s Labour Codes are futuristic.
India is one of the few countries in the world that has recognized Gig and Platform Workers in our Codes and they have been regsitered on the e-Shram Portal. While other countries are waiting for judicial interpretation on applicability of Employment Laws, especially Health, Insurance & Retiral Benegit related Laws to Gig & Platform Workers.
The Labour Minister is holding discussions with HR Heads across sectors to address concerns over Wage Code.
Issues will be addressed through Rules without altering the current structure of Codes, Labour and Employment Mijiste5 Bhupender Yadav told ET’s Intervewing Panel.
There is lot of speculation on the timing of implementation of the Labour Codes. While addressing this question the MOLE said….
The Labour Codes will be implemented as soon as possible. Around 26 States have notified Rules on Codes on Wages and all other States are working on notifying Rules on all the 4 Codes. We have partly implemented the Social Secuirity Code but we want to see all 4 Codes together in a comprehensive manner. The Govt. Will do everything through consensus and in a transperent manner.
Minister also said there are no differences between employers and employees as perceived by various Media Houses and the stakeholder. Whatever differences are there, the same can be sorted out through the Rules. These are things of discussion and we are building up a consensus. On a monthly basis we hold discussions with Trade Union Leaders and Heads of the HR Resorices Dept. of Companies.
Read MoreSome important case laws of October, 2021
- Abandonment to be presumed when workman did not resume duty despite intimation………Del HC
- Recommendation of Internal Committee without any reasoning is unsustainable………. HP HC
- Reporting on duty and entering room of Principal in inebriated condition is a grave misconduct……………MP HC
- Non Registration of Principal employer or License by Contractor, the workers will be treated as employees of Principal Employer ……..SC
- A work of pumping of water will be treated as manufacturing process in factory…………SC
- During enquiry under section 7A, any person other than employer or employee can be asked to cooperate………..MP HC
- EPF & MP Act, 1952 does not mandate the authorities to impose penalty in every case…….P&H HC
In a significant order, the National Consumer Disputes Redressal Commission (NCDRC) held that a home-buyer is a consumer within the meaning of Section 2 (1) (d) of the Consumer Protection Act since the developer had failed to prove that home-buyer (complainant) is indulging in the business of sale and purchase of the flats.
In an order issued earlier this month, the NCDRC bench of justice Deepa Sharma (presiding member) and Subhash Chandra (member) says, “… the burden is squarely upon the opposite party (IREO Pvt Ltd, High Responsible Realtors Pvt Ltd, Fiverivers Buildcon Pvt Ltd) to prove the fact that complainant is indulging in the business of sale and purchase of the flats. There is no contention in the written version that the complainant is indulging in the business of sale or purchase of the properties. Since the opposite party has failed to discharge this burden, we hold that complainant is a consumer within the meaning of section 2 (1) (d) of the Act.”
The bench also directed IREO Pvt Ltd, High Responsible Realtors Pvt Ltd, Fiverivers Buildcon Pvt Ltd to refund the entire principal amount of Rs2.24 crore to complainant Aloke Anand along with compensation in the form of simple interest at the rate of 10.25% per annum (CONSUMER CASE NO. 1277 OF 2017).
The case related to delay in possession for a flat booked by Aloke Anand in the project ‘SKYON’ of the opposite party situated at Golf Course Extension Road at Gurugram. He made an initial payment of Rs15 lakh and was given an allotment letter on 14 January 2011 by the developer. Later on several dates, he paid Rs2,23,91,480 as the total consideration amount as per the builder-buyer agreement executed on 14 February 2012. He was also made to pay certain additional charges by the developer.
The due date of possession of the flat as per the agreement was 42 months, with a grace period of six months from the date of approval of the building plan. However, after not getting possession of his flat from the developer, Aloke Anand approached the NDDRC seeking possession and compensation for the delay from the developer.
In its contention, the developer stated that Aloke Anand, the complainant, is not a consumer since he already has two residential addresses from Delhi and Jaipur. Further, he is only an investor in the subject property and he has also invested in another developer’s project in Victory Valley and has been allotted apartment no. B-2801.
“It is contended that he has invested for commercial gains, i.e. either by way of income of rent and/or re-sell at an appreciated value. The reason for the delay in completing the construction is mentioned in detail in the complaint,” the developer stated.
Responding to this, Aloke Anand, submitted that he is not the owner of the properties mentioned by the developer in its written statement. “Rather those properties are owned by the other members of his extended family and it is submitted that he is a consumer within the meaning of Section 2 (1) (d) of the Act,” he stated.
He also referred to a judgement delivered by the NCDRC on 6 December 2019 against the developer. This judgement was challenged by the developer in the Supreme Court (SC). However, on 11 December 2020, the apex court dismissed the appeal. Aloke Anand submitted with the dismissal of the developer’s plea by the SC, the order issued by NCDRC has attained finality and it should pass similar order in his case too.
Arguing that Aloke Anand, the complainant, is not a consumer, the developer stated that he bought the flat not for residential purpose but for commercial purpose and since he is not a consumer, the complaint should be dismissed.
Based on admitted facts, the NCDRC bench observed that Aloke Anand had booked the flat with the developer and the developer had failed to deliver possession of the flat within the stipulated time. The bench then delved into the definition of consumer. It quoted Section 2(1) of the Act and a judgement by the SC in Laxmi Engineering Works vs PSG Industrial Institute (1995 AIR 1428) while discussing the scope of Section 2 (1) (d) of the Act.
The apex court, in its judgement, had stated, “The National Commission appears to have been taking a consistent view that where a person purchases goods ‘with a view to using such goods for carrying on any activity on a large scale for the purpose of earning profit’ he will not be a ‘consumer’ within the meaning of Section 2(d)(i) of the Act. Broadly affirming the said view and more particularly with a view to obviate any confusion the expression ‘large-scale’ is not a very precise expression the Parliament stepped in and added the explanation to section 2(d)(i) by ordinance or amendment act, 1993.”
“…if the buyer of goods uses them himself, i.e., by self-employment, for earning his livelihood, it would not be treated as a ‘commercial purpose’ and he does not cease to be a consumer for the purposes of the Act…a person who purchases an auto-rickshaw, a car or a lathe machine or other machine to be plied or operated exclusively by another person would not be a consumer. This is the necessary limitation flowing from the expressions ‘used by him’, and ‘by means of self-employment’ in the explanation. The ambiguity in the meaning of the words ‘for the purpose of earning his livelihood’ is explained and clarified by the other two sets of words,” the apex court had said.
Citing the judgement, the NCDRC bench says, “….(if a) person indulges itself in commercial activities qua the goods and in case of purchase of residential houses, it can be said that buyer is indulging into the activity of buying or selling the properties and purchased it for that purpose.”
However, it noted, “It is settled proposition that burden is upon the opposite party to prove that the complainant is indulging in commercial activities of sale and purchase of the flats and that he had booked the subject flat with the intention to sell it to earn profit as part of his commercial activities.”
“There is no contention in the written version that the complainant is indulging in the business of sale or purchase of the properties. Since the opposite party has failed to discharge this burden, we hold that complainant is a consumer within the meaning of Section 2 (1) (d) of the Act,” it ruled.
The NCDRC then directed the developer to refund Rs. 2.24 crore with an interest of 10.25% to Aloke Anand. It also asked the developer to pay Rs25,000 as the cost of litigation to the home-buyer.
Read More
With respect to new directions of the EPFO Circular dated 01.06.2021 for mandatory seeding UAN with Aadhar for generating monthly ECR
VERY IMPORTANT BREAKING NEWS
24.09.2021
Subject : With respect to new directions of the EPFO Circular dated 01.06.2021 for mandatory seeding UAN with Aadhar for generating monthly ECR
On 10.09.2021, I raised , and argued three issues for relief before the Hon’ble Delhi High Court :
1. Grace period of 5 days be given for remitting PF Contribution as per paragraph 38 of the Scheme,1952 for the Wage Month of May 2021 failing which 7Q (interst ) , damages ( 14-B ) and additional liability under Section 36(1)(va) and Section 2(24)(x) of IT Act,1961will be faced by the Employers because of “due-date” and further requested for extension up to 31.12.2021 for generating ECR with out seeding Aadhar or without verification of Aadhar .
2. Whether directions of the EPFO in compliance of Section 142 of the Social Security Code,2020 , is legal or not ?
3. Whether seeding with Aadhar is necessary in view of Justice Puttaswamy case ,(2019) 1 SCC 1 or not ? Or in view of the Section 142 of the Social Security Code , 2020 which has not been notified , and moreover , Rules , Schemes have not been framed so far.
Therefore , the Delhi High Court has granted interim relief as prayed by the Association of Industries and Institutions on 17.09.2021.Now, the Employer/ Establishment can generate ECR without seeding Aadhar with UAN upto 30.11.2021 .
This matter is listed on 10.11.2021 for further hearing , and assessment of the legality of the EPFO Circular dated 01.06.2021 in view of Section 142 of the SS Code, 2020
Read MoreUttar Pradesh amends key labour law, abolishes imprisonment
In a move that will provide a huge relief to industrialists and also help to attract more investors to set up industrial units in the state, the Uttar Pradesh cabinet has approved the amendment to Uttar Pradesh Industrial Peace (Timely Payment of Wages) Act 1978, which technically eliminates the possibility of imprisonment in case an employer does not pay timely wages.
The amendment was approved at a cabinet meeting chaired by Chief Minister Yogi Adityanath. According to Suresh Chandra, additional chief secretary labour and employment, under Section 5 (2) of the Uttar Pradesh Industrial Peace (Timely Payment of Wages) Act 1978, if an employer owes Rs 1 lakh or more in wages to a worker and has not paid it, there was a provision for imprisoned from three months to three years, along with a fine of Rs 50,000/-.
By Dayanand Mangaonkar
Read MoreIndian arbitrator asks Renault-Nissan to pay workers ₹70.84 crore interim dues
Indian arbitrator asks Renault-Nissan to pay workers ₹70.84 crore interim settlement after the expiry of a previous wage agreement in March 2019
Workers at the Renault-Nissan plant in Chennai filed an industrial arbitration suit demanding ₹20,000 as a monthly interim settlement after the expiry of a previous wage agreement in March 2019
An Indian arbitrator has asked Renault-Nissan to pay its 3,542 workers at its southern Indian plant an average of over ₹7,100 ($95.52) per month in additional wages as interim relief, according to a copy of the order reviewed by Reuters.
Workers at the Renault-Nissan plant in Chennai filed an industrial arbitration suit demanding ₹20,000 as a monthly interim settlement after the expiry of a previous wage agreement in March 2019.
The consortium had agreed to pay on an average ₹2,250 every month ending March 2021.
Nissan had told the arbitrator its business in India could become “unviable in the long run” if it were to give in to demands of higher pay from its factory workers, according to a court filing by the Japanese automaker.
Nissan and its union have been locked in a legal arbitration dispute since July after the two sides failed to reach a mutual agreement over several issues including higher wages.
In an order dated Aug. 16, a judge ruled Renault-Nissan shall pay ₹10,000 per month for the 12 months ending March 2020, and ₹5,000 a month for the 16 months ending July 2021.
Reuters has reviewed the petition and the order, which have previously not been reported.
That would cost the management ₹70.84 crore ($9.53 million), according to Reuters calculations. Nissan Motor Co, which majority-owns the plant, did not immediately respond to an email seeking comment.
The tussle exposes the business challenges Nissan faces in the world’s fifth-largest car market where, despite investing about $1 billion, it has been elbowed out by competitors and is struggling to woo car buyers.
The setback shows the pressure that Nissan is under as it tries to restructure some of its key international markets such as India – where it is yet to decide on a future strategy for its under-utilised factory.
“Arrears as per the above direction shall be paid by the Respondent/Management in three monthly equal instalments commencing from 01.09.2021,” the order read.
By Dayanand Mangaonkar
Read MoreIf Union hoist their flag in employer’s property, what is the remedy available to the employer
No doubt, workers have fundamental right to form association and get themselves registered under Trade Unions Act, putforth their demands before management and act as a collective bargaining agent.
It is also true that there should be industrial peace in the industry but at the same time that can not be at the expenses of management right.
The unions can not unilaterally dictate terms in the name of industrial peace. It is undoubtedly true that visitors/customers coming to any such business premises and see such flags, posters and mast would naturally be afraid to have business with such company because of getting suspicious about the capability of the company to fulfil their commitment in time knowing about the climate on account of over dose of trade union activities.
If Union people have hoisted the flags, in the employer’s premises and on the common wall which not only belongs to the employer but to others also, in such situation no union has any right to do such activity in the property belonging to the employer or others.
Employer has legitimate rights to ask union to remove such flags, mast and posters from the premises and if they do not agree to it, remove yourself with the appropriate help of concerned authorities. Kerala High Court in the case of Kerafibertex International Pvt. Ltd. vs. Kerafibertex Employees Association, has also so held.
By Dayanand N. Mangaonkar
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