KARNATAKA HIGH COURT QUASHES

MINIMUM WAGES REVISION

"Carelessness and negligence" by governmentputs private sector employees in a quandary. HC
directs fresh revision by November 30; butorders 75 per cent of pay to be paid to employees
till fresh revised notification is issued.

The high court has quashed the state government's notifications of revising minimum wages for
private sector employees in hospitals, automobile engineering, ceramics and other industries. But
the court has ordered the industries to continue to pay 75 per cent of the wages to their employees as
per the notification till a fresh revised notification is issued by the state government.

The quashing was necessitated by a mistake on the part of the state government in failing to follow
procedures. Coming down heavily on the state government for this "glaring lapse" due to its
"carelessness and negligence", the court has ordered an inquiry and imposition of penalties on the
officers responsible.

To safeguard the interests of the private sector employees, the court directed that a new revision of
wages be completed and notified by November 30, 2016.

The notification revising minimum wages under the Minimum Wages Act was issued in the name of
the Karnataka government with effect from April 1, 2015.

The wages were revised for employments in the "automobile engineering (including service and
repair), foundry, hospitals, oil mills, printing press, ceramics, stoneware, pottery works and veneer
industries.

The last revision of wages for these sectors was in March 2009, and it had to be revised after five
years. The draft notification for the revision was published in October 2014 and the advisory
committee submitted its report on May 27, 2015.

The state government issued the notification of revision of wages on July 30, 2015 for automobile
engineering and veneer industries. It issued notification for the other industries on August 3, 2015.

The industry owners approached the high court, which had stayed the notifications, but on the
condition that the employers would pay 75 per cent of the amount specified. The final judgment in
the case heard by Justice AN Venugopala Gowda, came on October 28, 2016.

FAILURE OF PROCEDURE

As per procedure, once the advisory committee gives its recommendation, the minister concerned
and the state government has to take a decision to fix or revise the minimum wages in the scheduled
employments. The recommendation is not binding on the government. But in this case, the state
government was unable to show that the secretary of the labour department, or the minister
concerned, or the state government, had taken a decision on the recommendation.

But the notification was issued in the name of the government without this approval. Thus the
publication of the notification was held to be invalid and ultra vires of the provisions of Minimum
Wages Act.

NEGLIGENCE AND CARELESSNESS

The high court observed that "on account of the glaring lapse on the part of the officials and officers
concerned in the labour department, interest of thousands of sweated employees is getting affected."

The delay and suffering of the sweated labour "is clearly on account of the carelessness/negligence in
not placing the files before the minister concerned for consideration and decision. The glaring lapse
on the part of the officers/officials of the labour department in the secretariat has resulted in further
delays of the revision and fixation of minimum rates of wages of the sweated employees."

The court said those responsible should be penalised. "The gravity of the lapse disclosed in these
cases is such as would call for an immediate inquiry by (the) chief secretary, government of
Karnataka and imposition of appropriate penalty on all the delinquent officials/officers," the court
said and directed the government to file an action-taken report before December 31, 2016.

Hundreds of employers including big names like Tata Motors, Bhoruka Steel & Services and KLE
Society had approached the high court.

Although their petitions were allowed with the quashing of the notification, they were ordered to
continue to pay 75 per cent of the wages to their employees as per the notification till a fresh revised
notification was issued by the state government.

Karnataka High Court quashes government

order on minimum wages
The Karnataka High Court on Friday quashed the state government's notifications on
fixing/revising minimum wages for scheduled industries.
The court directed that the state should consider the advisory committee's report and
revise/fix the minimum wages before November 30 and publish the notification in the
interest of thousands of workers whose day-to-day necessities of life have been kept in
view by Parliament while enacting the Minimum Wages Act, 1948.
Till such time, the petitioners (automobile engineering, including service and repair,
foundries, hospitals, oil mills, printing presses, ceramics, stoneware, pottery works and
veneer industries) should continue to pay 75% of the wages to their employees, subject
to adjustment against the wages to be fixed under fresh notification by the government.
"There being glaring lapse and gross dereliction of duty on the part of the
officials/officers of the Labour Department in the Secretariat, the Chief Secretary to the
government shall conduct an inquiry, and appropriately penalise the officials/officers
concerned. The action taken shall be reported to this Court on or before 31.12.2016,"
the court observed in its order.