053-NLR-NLR-V-62-RICHARD-PIERIS-CO-LTD-Appellant-and-D.-J.-WIJESIRIWARDENA-Respondent.pdf
T. S. FERNANDO, J.—Richard Bieris <&s Go. Ltd., v. Wijesiriwardena
233
1960Present: T. S. Fernando, J.RICHARD PIERTS & CO. LTD., Appellant, and
J. WTJESIRIWARDENA, Respondent
S. C. (Labour Tribunals') 5—Labour Tribunal Case 123 of 1959
Industrial Disputes Act, No. 43 of 1950, as amended by Act No. 62 of 1957—■Termi-nation of workman’s services—Gratuity or other benefits due from employer—Computation—Sections 31 JB (J) (6), 31 B (5), 31 C {1).
By section 31 B (1) (6) of the Industrial Disputes Act, No. 43 of 1950, asamended by the Industrial Disputes (Amendment) Act, No. 62 of 1957—
“ A workman … may make an application in writing to a Labour
Tribunal for relief or redress in respect ofthe question whether
any gratuity or other benefits are due to him from his employer on terminationof his services and the amount of such gratuity and the nature and extent ofany such benefits.”
Held, that the word “ due ” meant “ legally due
-AlPPEAL from an order made by a Labour Tribunal.
O.E. Chitty, Q.C., with Carl Jayasinghe, for the respondent-appellant.No appearance for the applicant-respondent.
Cur. adv. vuU.
September 5, 1960. T. S. Fernando, J.—
This is an appeal against an order made by a Labour Tribunal estab-lished in terms of section 31A of the Industrial Disputes Act, No. 43 of1950, as amended by the Industrial Disputes (Amendment) Act, No. 62of 1957. An appeal can be preferred only on a question of. law, andthe substantial question of law raised is that the Tribunal in making anorder for the payment of a gratuity to the applicant has acted in excessof its jurisdiction which, it is claimed, is limited to ordering payment of agratuity that is due to the applicant from his employer.
Section 3IB provides for the making by or on behalf of a workman ofapplications to a Labour Tribunal for relief or redress in respect of anyof the following matters :—
the termination of his services by his employer ;
the question whether any gratuity or other benefits are due to him
from his employer on termination of his services and the amountof such gratuity and the nature and extent of any such benefits ;
such other matters pertaining to the relationship between an
employer and a workman as may be prescribed.
It was not claimed that the application was in respect of the mattersreferred to in (a) or (c), but that it fell within the matters describedin (b) above.
234 T. S. FERNANDO, J.—Richard Pieris & Co. Ltd. v. Wijesiritvardena
The following facts appear not to have been in dispute at the inquiryby the Tribunal
The applicant was an employee of Richard Pieris & Go. Ltd. as ChiefForeman for a period of 7 years and 9 months terminating on 31st March1959. His services were terminated by the company after a noticeserved on him five months before 31st March 1959, and the reason givenby the company was that he had reached the age of 64 years. Sometimeprior to the date of termination, the Board of Directors of the companyhad decided that with effect -from 1st April 1959 no employee of thecompany shall be continued in service after be had attained the ageof 60 years.
The applicant had, prior to his employment with the company, beenemployed by the Ford Company for some 17 years, but when the Ford-Company ceased to do business in Ceylon (Richard Pieris & Co. Ltd.having taken over the business in Ceylon of the Ford Company) thatcompany had' paid an admittedly adequate gratuity to the applicantin consideration of his 17 years of service.
At the time the applicant came to be employed under Richard Pieris& Co. Ltd. in 1951 there existed a Provident Fund Scheme for all employeesof the company, the company contributing roughly about 12% of thesalary of an employee, while the employee himself contributed 10%.Under this Scheme, the applicant had become entitled to receive at thetime his services with the company were terminated a sum of Rs. 6814/15,and this sum had been drawn by the applicant.
Apart from the Pension Fund Scheme, there Avas a Long SerAriceBonus Scheme under which every employee who had completed 25years’ service with the company Avas entitled to three months’ basicsalary. The applicant’s service had lasted less than 8 years, and he wastherefore not entitled to any bonus under this Scheme.
A Gratuity Scheme also came into operation after the date the applicant'sservices with the company terminated according to Avhich an employeeat the time of retirement becomes entitled to one month’s basic salaryfor each completed year of service less the company’s contribution to theProvident Fund. It is clear that, even if this Scheme had been in exis-tence while the applicant was in.the company’s service, the applicantwould have received nothing thereunder as the gratuity would haveamounted to Rsi 3115/- Avhile the company’s contribution to the Provi-dent Fund was some Rs. 3474/45.
The facts appearing to be as stated above, the position taken up by thecompany was that under the existing Schemes no sum of moneyremained due and payable to the applicant. The applicant claimed thatan order should be made entitling him (a) to a suitable gratuity and (6)to suitable compensation for loss of career. When the application cameup for inquiry the applicant withdrew any claim for compensation for lossof career. At the conclusion of the inquiry, the Tribunal stating that** it is now settled as a matter of principle that, when the finances of abusiness concern permit, two retiring benefits to employees may be
T. S. FERNANDO, J.—Richard Pieris cb Co. Ltd. v. Wijesiritoardena 235
allowed on the footing that a provident fund provides a certain measureof relief only and a portion of that constitutes the employee’s wagesthat he or his family would ultimately receive and that this provision inthe present conditions is wholly insufficient relief ”, held that theapplicant is entitled to a gratuity at the rate of two-thirds of the basicsalary for a period of 7 years. Calculating at this rate for the periodstated, the company was ordered to pay a sum of Rs. 2076/66 to theapplicant.
It was argued for the company that the application to the Tribunalis for relief or redress against the withholding of a gratuity or otherbenefit that is due to the applicant from the employer, and it was contendedthat this meant legally due. It is unfortunate that I was left without theassistance of any argument on behalf of the applicant on this questionin which there appears to be no earlier decision of this Court. I drewthe attention of learned counsel to section 31 C (1) which empowers theTribunal to “ make such order as may appear to the Tribunal to bejust and equitable”. Counsel in reply has contended that, broadly. speaking, the jurisdiction of the Tribunal is limited by the Act to theascertainment of dues as distinguished from the formulation of schemesand that nothing can be said to be just and equitable which is outsidethe framework of the Act itself. As illustrative of the situations in whichsection 31 C (1) may have application, counsel instanced the case wherea gratuity or other benefit had. become due but not legally enforceable,and, again, where such a benefit is payable under existing conditions ofservice but was not available to those who had been in employment underdifferent conditions of service. The Act itself gives me no certain guideas to the meaning to be attached to the relevant provisions of section31, and in this situation I have arrived at the conclusion that my dutyis to place on the word due in section 31 B (1) (6) of the Act the meaning“ legally due ” as claimed by the company. In support of the conclusionto which I have been driven in this matter, I might refer to the provisionin sub-section (5) of section 31 B which precludes the applicant seekingany other legal remedy where he has made an application under section31B and again shutting him out from the remedy under this Act wherehe has first resorted to any other legal remedy. A legal remedy pre-supposes a legal wrong, and in the context under discussion the legal wrongwould be the refusal to pay a sum of money or grant some benefit legallydue. In regard to the power of the Tribunal to make such order as mayappear to it to be just and equitable there is point in Counsel’s submissionthat justice and equity can themselves be measured not according to the1 urgings of a kind heart but only within the framework of the law.
Bor the reasons indicated above, I hold that the Tribunal acted in•excess of its jurisdiction under the Act in ordering the payment of agratuity which was not due to the applicant. The order of the Tribunal-appealed from is set aside, but I refrain from making an order for costsin this case.
Order set aside.