JANATHA ESTATES DEVELOPMENT BOARDAND OTHERSv.
COURT OF APPEAL.
O.P.S. GUNASEKERA, J.
C. A. No. 232/84 – L.T.'CASE No. 9/12635/83,
JANUARY 16, 1990.
Industrial Disputes. – Unjustified termination – Refusal to comply with punitive transferorder.
Although an employer has an inherent right to transfer an employee it must be made bonafide. The respondents had found the applicant guilty of a serious act of misconductwithout affording him an opportunity of being heard. They had acted unilaterally intransferring him. The order of punitive transfer was arbitrary and the applicant was notbound to comply- Hence the termination was unjustified.
Cases referred to :
(1) Ceylon Estate Staff Union v. Superintendent, Madekumbura Estate, Wattagoda 73N.L.R. 278.
' (2) Estates Staff Union v. The Superintendent and Others (1986) 1 C.A.L.R. 102.APPEAL from order of President, Labour Tribunal.
Chula de Silva, P.C. with N. Chasie Chetty, R. Deviligoda and C. Liyanapatebendi foremployer-appellant.
H. L. de Silva, P.C. with Harsha Soza and P N. Ratnawadana for applicant-respondent.
Cur. adv. vult.
September 12. 1990
P. S. GUNASEKERA, J.
The Applicant-Respondent had made an application to the LabourTribunal dated 5th May, 1983 stating that his services as AssistantSuperintendant, Dunsinnane Estate, Pundaluoya were terminatedwithout any valid reasons by the Employer-Appellants on 6th April, 1983and prayed for (a) reinstatement with backwages and or compensationfor loss of career, (b) for gratuity, (c) for Statutory and other dues.
The Respondent-Appellants filed answer admitting the terminationof the services of the Applicant-Respondent and pleaded that theApplicant-Respondent was transferred to Miyanwatte Estate,Daraniyagala with effect from 1 st March, 1983 by letter dated 8thFebruary, 1983 and that the Applicant-Respondent refused to complywith the said transfer order despite repeated requests and therefore thetermination of the services of the Applicant-Respondent was lawful andjustified.
At the inquiry before the Tribunal C. S. Gunathilake, theSuperintendant and J. G. Perera, the Assistant Superintendant of theDunsinnane Estate gave evidence on behalf of the Employer-Appellantsand marked and produced documents R 1 – R 16. The Applicant-Respondent did not give evidence but called Tangawelu, the chiefKanagapulle, Dunsinnane Estate as his witness.
After the inquiry the learned President by his order dated 17th ofApril, 1984 held that the services of the Applicant-Respondent hasbeen terminated without valid reasons and ordered that he be reinstatedwith backwages for 6 months amounting to Rs. 6,054. It is against thisorder that the Employer-Respondents have appealed.
The facts relating to this case briefly are as follows :
On the morning of 16.12.82 a conference had been arranged in theEstate factory by the Superintendant Gunathilake at which the Applicantand other Assistant Superintendents Ranathunge Premadasa, Pereraand Madiwela had been present. The purpose of this conference hadbeen to discuss the programme of work relating to weeding in thevarious divisions of the Estate for the month of December. A few daysearlier the Agricultural Advisor Anil de Silva had done an inspection ofthe estate ; the weeding programme on each division was to bediscussed and firstly the discussion had centred around the division inwhich the factory was located and then the discussion in regard to themiddle division which was in charge of the Applicant-Respondent hadcommenced. This had been the division in which weeding had been verybadly neglected and when this situation was pointed out the Applicant isalleged to have lost his temper and made disparaging remarks about theAgricultural Advisor and said that since the Agricultural Advisor has onlyone eye that he could not see properly and turned abusive towards theSuperintendant. All attempts to control the Applicant had failedwhereupon the Superintendant has requested the Applicant-AssistantSuperintendant to leave the factory which he had refused to do. TheSuperintendant had then informed the other Assistants that they couldnot continue with the discussion and left the factory.
The Applicant is alleged to have continued to abuse theSuperintendant in obscene language and followed him to the car; afterthis incident the Superintendant had gone to his office when the otherAssistants had come into his office and reported that the Applicant hadcontinued to abuse him in obscene language and made disparagingremarks about him.
The Superintendant had thereafter reported this incident to theDirector, Group.Three of the Janatha Estates Development Board No. 2,Nuwaraeliya by document R1 and suggested that an inquiry be held inregard to the conduct of the Applicant-Respondent.
The Director of Janatha Estates Development Board hadcontemplated disciplinary action against the Applicant-Respondent andapproval had been sought from the General Manager through theChairman in Colombo. This contemplated action is evidenced by R2 and
a detailed report had been called for from the Superintendant by R3 towhich the Superintendant had responded by sending his report R4.Thereafter by letter dated 8th February, 1983 marked R5 the Applicant-Respondent had been transferred to Miyanwatte Estate, Daraniyagala ■with effect from 1 st March, 83. In R5 the letter of transfer inter alia it isstated as follows : "although such misconduct on your part warrantssevere disciplinary action not excluding the termination of your services,we are not in this instance proceeding to take this extreme step buttransferring you out of Dunsinnane Estate as a punitive measure with thewarning that if there is any complaint in the future in regard to your work.or conduct your services are liable to be summarily dismissed."
This letter of transfer had been acknowledged by the Applicant-Respondent by R6 and he had denied the charges levelled against himand refused to comply with the transfer order transferring him toMiyanwatte Estate as it had been a punitive transfer. By R7 dated 15thMarch, 1983 the General Manager of the 1 st Respondent Board hadconfirmed the order of transfer and requested the Applicant to complywith it and intimated that severe disciplinary action would be taken in theevent of the transfer order was not complied with by the 31 st March,1983. The Applicant-Respondent had again protested about histransfer stating that he was not guilty of any act of misconduct by R8 andrefused to go on transfer to Miyanwatte Estate, Daraniyagala andthereafter the Applicant-Respondent's services had been terminated byR9 dated 6th April, 1983.
Having considered the evidence placed before him the learnedPresident has taken the view that the allegations made against theApplicant-Respondent have not been established before him ; in anyevent the Respondent-Appellants have taken the decision to terminatethe Applicant's services without affording him an opportunity ofanswering the charges levelled against him and imposed a doublepunishment by warning him and transferring him to Miyanwatte Estate.The learned President in this context holds therefore that the transfer ofthe Applicant-Respondent to Miyanwatte Estate has been a punitivetransfer and was unreasonable.
Learned President Counsel for the Appellants submitted that thePresident had made several errors in his order and therefore it should beset aside. He contended that the learned President misdirected himselfin regard to the powers of the Labour Tribunal and contended that amatter of a transfer of a employee is not within the jurisdiction of a
tribunal. In support of this submission learned Counsel stated that thePresident was bound by the decision in the Ceylon Estates Staff Union v.Superintendant, Madekumbura Estate, Wattagoda (1) whichrecognized the right of an employer to transfer an employee and whichheld that the refusal to comply with a reasonable transfer order entitlesthe employer to terminate the workman's services.
Learned Counsel submitted that the question of the transfer of anemployee is an internal management function and that in the absence ofprovisions to the contrary it is an implied term in the contract and that therefusal to comply with a reasonable transfer order entitles the employerto terminate the employee's services.
In the Estates Staff Union v. The Superintendant and others [2)W. A.
de Silva, J. having considered all the authorities has held thatalthough an employer has an inherent right to transfer an employee thatthe right to transfer is subject to the following limitations
It should not be contrary to the contract or terms of employment.
Transfer should not be Mala fide.
There is no implied condition of service that an employee can betransferred to a new concern commenced by the employer andsubsequent to the date of the employers recruitment.
An employee, cannot be transferred from one employer toanother.
A transfer must not involve a change in the condition of service ofthe employee transferred.
The learned Counsel for Appellant also submitted that the Presidenthds failed to address his mind to the question of the failure of theApplicant-Respondent to give evidence at the Tribunal and contendedthat there was no evidence by the Applicant-Respondent that histransfer to Miyanwatte Estate was made Mala fide.
Learned President Counsel for the Applicant-Respondentscontended that the question of the Applicant-Respondent givingevidence did not arise since on the evidence of the Respondents alone itis implicit that the transfer of the Applicant was not bona fide. Hiscontention was that although the Respondent-Appellantscontemplated in taking disciplinary action against the Applicantconsequent to the report made by the Superintendant by R1, thatwithout calling for the explanations of the Applicant, without any chargebeen framed and without affording an opportunity to the Applicant tomeet the charges that the Respondents have taken an unilateraldecision and found him guilty of a most reprehensible conduct if it is trueand imposed a dual punishment. He submitted that the 1 st intimationthe Appellant received was R5 where the Respondents alleged that theApplicant was guilty of misconduct and that he was been transferred toMiyanwatte Estate on account of it.
Although an employer has an inherent right to transfer an employee itmust be made bona fide. The question that has to be determined in thiscase is whether the Applicant was justified in refusing to comply with the ■order of transfer made by R5. Learned Counsel for the Applicant-Respondent contended that an employee is not obliged to comply withan unlawful order he submits that by R5 it is clear that the Respondents-Appellants have found the Applicant guilty of a serious act ofmisconduct without affording him an opportunity of being heard andtherefore this transfer effected by R5 is an illegal order. On aconsideration of R1 it appears that the 3rd Respondent-Appellant hascomplained to his superior Officers about the conduct of the Applicant-Appellant and requested that an inquiry be held. By R2 disciplinaryaction has .been contemplated and approval had been sought from theGeneral Manager to hold an inquiry in respect of the alleged act ofmisconduct and a detailed report had been called from the 3rdRespondent which had been forwarded by R4. Having contemplateddisciplinan/ proceedings the respondents have acted unilateraly andtaken steps to transfer the Applicant-Respondent having found himguilty and transferred him by R5. Although the employer's right totransfer is undisputed the conduct of the 1 st and 2nd Respondents inthis case indicates that they have acted arbitrarily and it is inconsequence of the refusal to comply with this order of transfer hisservices has been terminated by R9 dated 6th April, 1983. It is upon anexamination of these sequence of events that the learned President hastaken the view that the termination of the services of the Applicant-Respondent in this arbitrary manner was unjustified.
On a consideration of the submissions of the learned Counsel andupon an examination of the evidence led before the Tribunal in my view,it was open to the learned President of the Labour Tribunal to havereached the conclusion that he arrived at. In these circumstances I seeno reason to interfere with his findings and accordingly this appeal isdismissed with costs in a sum of Rs. 315.
JANATHA ESTATES DEVELOPMENT BOARD AND OTHERS v. KURUKULADITTA