Allowing an appeal in Sunil KR Ghosh & Ors v K Ram Chandran & Ors, the Supreme Court said it is settled law that an unwilling employee “cannot be forced to work under different management”. Such employees are entitled to retirement or retrenchment benefits under the Industrial Disputes Act, 1947.
The appeal had been filed by employees of Philips India, who were unwilling to work under the company’s new management after its consumer electronics factory in Salt Lake City, Kolkata, was sold in 1998 to Kitchen Appliances India, a subsidiary of Videocon International. The aggrieved employees had tried to use a voluntary retirement scheme (VRS) to leave the company, but were unsuccessful as the new management said the scheme lapsed in 1997.
In 2001 a single judge of Calcutta High Court directed Philips India to pay retirement or retrenchment benefits to the workers who wanted to leave the company. The management failed to comply with the order and the employees filed a contempt application with the high court, but it was dismissed by a division bench in 2008. This triggered the appeal to the Supreme Court.
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The update of court judgments is compiled by Bhasin & Co, Advocates, a corporate law firm based in New Delhi. The authors can be contacted at lbhasin@bhasinco.in or lbhasin@gmail.com. Readers should not act on the basis of this information without seeking professional legal advice.
