005-SLLR-SLLR-1990-2-RUBBERITE-COMPANY-LTD.-v.-LABOUR-OFFICER-NEGOMBO.pdf
RUBBERITE COMPANY LTD.
v.LABOUR OFFICER, NEGOMBO
COURT OF APPEALS. N. SILVA, J..
C. A. 104/86 – M. C. NEGOMBO No. 12492.
MARCH 12,1990 & JUNE 11,1990.
Industrial Dispute – Termination of employment – Strike – Invitation to report to work beforefinal date – Refusal of admission to work place on workers reporting on a later date—Lock-out — Prosecution under s. 40 (1) (i) of Industrial Disputes Act — Mens tea.
A branch union of a workers union was formed by a number of workmen of the appellantCompany. The formation pf the union was notified to the management and about the sametime the Company terminated the services of 10 of its workers, including some officebearers of the union. The union alleged that the dismissals were acts of victimisation di-rected at its formation but the Company insisted that it was solely due to the bad attendanceof the workmen concerned. The dispute remained unsolved and the union staged a strike.The company gave an ultimatum to the workmen to return to work by a certain dateinforming that if they failed to do so they would be as having ceased to be employees. Theworkmen failed to return. The matter was then referred for arbitration under section 4 (1)of the Industrial Disputes Act. The union later informed the management that pursuant tothe order made by the Minister the members of the union will report for work. When theyreturned to work accordingly they were refused entry. Thereafter a prosecution wasinstituted in the Magistrate's Court for an offence committed under section 40 (1) (1) of theIndustrial Disputes Act which makes it an offence for an employer to cause a lock-out in
any industry after a dispute has been referred for settlement but before an award in respectof such dispute is made. The Company was found guilty and fined Rs. 500 00. TheCompany appealed against the conviction.
Held:
Section 40 (1) (1) prohibits the commission of certain acts in any industry committed duringa specific period of time.
The term lock-out covers the following acts done in consequence of a dispute :
the closing of a place of employment;
suspension of work;
the refusal by a employer to continue to employ any number-of persons employedby him.
The person perpetrating the lock-out should be the employer and the person or personsagainst whom it is levelled should be employees.
To constitute an offence under the section it is essential that there be an employer-employee relationship between the person accused of the offence and the person orpersons who are alleged to have been locked-out at the time of the commission of theoffence.
The term ‘strike* generally denotes collective action resorted to by a body of employeesto express their grievances and to win their demands from an employer. As defined insection 2 of the Trade Unions Ordinance it involves the cessation of work by a body ofemployees or a concerted refusal or a refusal under a common understanding to continueto work or to accept employment Although generally a strike is a means used against anemployer, there could be situations when a strike is resorted to by employees with otherobjectives.
The Industrial Disputes Act recognises a basic right of workmen to commence and toparticipate in a strike to expess their grievances and to win their demands subject to therestrictions and prohibitions that are specifically laid down.
The employer could not validly issue an ultimatum to workmen on a lawful strike requiringthem to report to work before a specified date or in the alternative be considered as havingceased to be employees or as having abandoned their employment.
The underlying basis of a strike by workmen is an absence on their part of an intention toterminate their contracts of employment.
An employer cannot validly issue an ultimatum to a workman engaged in a lawful strike toreport for work before a specified date or in the alternative be considered as having ceasedto be an employee. Therefore the letter V 3 which fall? into the category normally describedas a notice of vacation of post cannot be considered as valid or as being capable ofproducing any legal effect
The employer-employee relationship between the parties continued and was subsisting asat 07.01.1985 being the date of the offence.
The contention that there was no mens rea because there was no work to offer as exportorders had been lost is untenable because there were other persons continuing inemployment.
Casas referred to:
Vine v. National Dock Labour Board 1956 3 all ER 936, 946
University Council of Vidyodaya v. Linus Silva 66 NLR 505, 507
The Ceylon Hotels Corporation v. Jayatunga 74 NLR 442, 445
Morgan v. Fry 1968 3 WLR 506,513
Express News Papers v. Mark AIR 1963 SC 1141
APPEAL from conviction entered by the Magistrate of Negombo.
Chula da Silva, P. C. with R. Develigoda and C. Liyanapatabendi for accused-appellant.
Aluvihare, S.C.C. lor complainant – respondent.
Cur. adv. vult.
July 6, 1990.
S. N. SILVA, J.
The Appellant Company was at the time material to this case engaged inthe manufacture of certain rubber based items, for export. On 23.08.1984the Industrial Transport and General Workers Union formed one of itsbranches at the Company comprising of a number of its workmen. Theformation of the branch Union was notified to the management of theCompany on 24.08.1984 and at about the same time the Companyterminated the services of ten of its workmen including some officebearers of the Union. The Union alleged that the dismissals were acts ofvictimisation directed at its formation but the management insisted thatthe dismissals were unrelated to the formation of the Union and werebased solely on the bad attendance at work of the workmen concerned.The dispute remained unresolved and the Union gave notice by letterdated 1.9.1984 of a token strike that was held on 4.9.1984. Thereafter theUnion gave further notice and staged a strike proper from 7.9.1984.
The officers of the Department of Labour arranged several discussionsbetween the parties but the dispute with regard to the dismissal of the 10workmen remained unresolved and the workmen continued their strike.
On 20.9.1984, the Company sent letter marked ‘V3’ notifying theworkmen who had kept away from work that they should report for workby 27.9.1984 and if not they “will be treated as having ceased to beemployees". The letter also states that the Company will thereafter recruitother labour. It appears that none of the workmen on strike responded tothe ultimatum contained in the said letter.
By order dated 21.12.1984 published in the Government Gazette of4.1.1984 (P7) the then Minister of Labour acting in terms of section 4 (1)of the Industrial Disputes Act referred the dispute between the Union andthe Company for settlement by arbitration to the arbitrator named in theorder. The statement of the matters in dispute shows that it relates to thetermination of services of the 10 workmen referred above. It appears fromthe contents of letter marked P1 that by letter dated 4.1.1985 the Unioninformed the management of the Company that pursuant to the ordermade by the Minister, the members of the Union will report for work on7.1.1985.
The workman W. P. Hemapla, in his evidence, gave a completeaccount of what took place on 7.1.1985. According to his evidence, whichwas not challenged regarding this aspect, all the workmen on strikereported for work on 7.1.1985. They were stopped at the gate by asecurity officer employed by the Company. They requested the securityofficer to inform the Personnel Officer that they have come to report forwork. They were in turn informed that the Personnel Officer could notmake a decision on the matter and that they should settle the matter withthe Department of Labour and the Union. The workmen immediately senta letter to the Personnel Officer (P 4) stating what was communicated tothem and also complaining that they could not report for work becausethey were prevented from entering the premises. It appears thatthe Unionalso addressed prompt complaints regarding this matter to the Companyand the Labour Department (P1 and P2). The Assistant CommissionerofLabour, Negombo wrote letters dated 31.1.1985 (P 5) and 15.2.1985 (P6) requesting that the workmen who had been on strike be given work inview of the order made by the Minister referring the dispute to arbitration.In letter marked P 6 it is specifically stated that if the Company failed tocomply it would be prosecuted for committing an offence under section40(1) (/) of the industrial Disputes Act. The Company did not respond toany of these letters sent by the Union and the Assistant CommissionerofLabour. Even the defence did not produce any copy of letter sent by theCompany stating the reason for not permitting the workmen who werehitherto on strike to report for work on 7.1.1985.
On 20.9.1985 the Labour Officer instituted a prosecution against theCompany for committing an offence under section 40(1) (f) of theIndustrial Disputes Act which is punishable under section 43(1) of thatAct. After trial the learned Magistrate by his order dated 20.3.1986 foundthe Company guilty of the offence and imposed a fine of Rs. 500/=. Theappeal has been filed against this conviction and the sentence imposed.
At the hearing of this appeal, learned President's Counsel appearingfor the Appellant Company did not seek to canvass any of the facts asstated above. The main submission of Counsel was that as at 7.1.1985,the Company had ceased to be the employer of the workman W. P.Somapala named in the charge and of the other workmen who continuedto be on strike. That, when the workmen failed to report for work on27.9.1984 as required by notice marked V3, they were treated as havingceased to be employees and there was a termination of the contract ofemployment. Learned State Counsel submitted that the workmen wereon strike and as such they could not be considered as having abandonedtheir employment when they defied the ultimatum of the Company ascontained in the notice marked V 3. Therefore the employer – employeerelationship subsisted as at 7.1.1985.
Section 40 (1) (I) of the Industrial Disputes Act states the offence withwhich the Company was charged as follows :—
“ (1) being an employer, commences, continues, or participates in,or does any act in furtherance of, a lock – out in any industry after anindustrial dispute in that industry has been referred for settlement to anindustrial court, or for settlement by arbitration to an arbitrator, or forsettlement by adjudication to a labour tribunal but before an award inrespect of such dispute has been made ;
It is seen that the section prohibits the commission of certain acts in anyindustry committed during a specific period of time. The acts prohibitedrelate to a lock-out in any industry. It covers the commencement orcontinuance of or the participation in or the doing of any act in furtheranceof a lock – out. The prohibition becomes operative after the Minister byorder refers an industrial dispute in that industry for settlement, byarbitration to an arbitrator (section 4 (1)), to an Industrial Court (section4 (2» or by adjudication to a labour tribunal (section 4 A).
In terms of section 48 of the Act the term “ lock-out” has the samemeaning as in the Trade Unions Ordinance. Section 2 of the Trade UnionsOrdinance defines the term “lock – out” as follows
“ Lock – out” means the closing of a place of employment or thesuspension of work, or the refusal by an employer to continue toemploy any number of persons employed by him in consequence of adispute, done with a view to compelling these persons, or to aidanother employer in compelling persons employed by him, to acceptterms or conditions of or affecting employment.
According to this definition, the term lock – out covers the following actsdone in consequence of a dispute :—
the closing of a place of employment;
the suspension of work ;
the refusal by an employer to continue to employ any number ofpersons employed by him.
The words, “place of employment", “suspension of work" and "refusal
to continue to employ” found in relation to all three sets of acts
clearly show that a lock – out can take place only in the background of a' continuing employer – employee relationship. The person perpetratingthe lock – out should be an employer and the person or persons againstwhom it is levelled at should be employees. Considering this basic featureof a lock – out and the opening words of section 40 (1) (I), referred above,
I am of the view that to constitute an offence under that section it isessential that there be an employer – employee relationship between theperson accused of the offence and the person or persons who are allegedto have been locked – out, at the time of the commission of the offence.I find no difficulty in agreeing with the submission of learned President’sCounsel upto this point.
The next aspect to be considered is whether there was an employer- employee relationship between the Company and the workman namedin the charge as at 7.1.1985. Counsel submitted that when the workmankept away on 27.09.1984 defying the ultimatum in letter V3, he ceased tobe an employee and that he was so treated by the company. That atermination of a contract of employment even if it be unjustified could notbe considered null and void unless it is so declared by statute. In thisregard he relied upon the dictum of Lord Keith in the case of Vine v.National Dock Labour Board (1) which is as follows:—
“ Normally, and apart from the intervention of statute, there wouldnever be a nullity in terminating an ordinary contract of master andservant. Dismissal might be in breach of contract and so unlawful butcould only sound in damages."
This dictum of Lord Keith has been followed in the cases of UniversityCouncil of Vidyodaya v. Linus Silva (2) and in the case of The CeylonHotels Corporation v. Jayatunga, (3)
The dictum of Lord Keith is a general statement which is ‘normally’applicable to contracts of service. It could however not be applied as a ruleof thumb to all situations that may arise in master and servant relations.To my mind two matters have to be specially considered before thedictum is applied to the facts of this case. They are
In this case the alleged termination is not an act of the employerbut resulted from certain negative conduct on the part of theworkman in not reporting for work. In other words, the allegedtermination rests on an abandonment of the contract by theworkman; and
Whether a workman who is admittedly on strike pursuant to a ‘demand made by him on the employer could be considered ashaving abandoned his contract if he defied an ultimatum issuedby the employer whilst he was on strike.
Both matters are interconnected and could be conveniently dealt withtogether.
The term strike generally denotes the collective action resorted to bya body of employees to express their grievances and to win theirdemands from an employer. According to the definition of the term insection 2 of the Trade Unions Ordinance it involves the cessation of workby a body of employees or a concerted refusal or a refusal under acommon understanding to continue to work or to accept employment.Although generally a strike is a means used against an employer therecould be situations where a strike is resorted to by employees with otherobjectives. It would not be necessary for the purpose of this judgment to■ consider the implications of such other species of strikes. The mainfeature of a strike is the cessation of work devoid of an intention on thepart of those engaged in the strike to terminate their employment.
Section 32(2) of the Industrial Disputes act requires that at least 21days written notice be given, in the prescribed manner before thecommencement of a strike in any essential industry. Any workman whocontravenes the provisions of section 32(2) and any person who incitesa workman to commence, continue or participate in or do any act infurtherance of a strike in contravention of section 32(2), is guilty ofoffences as specified in section 40(1) (d) and (n) respectively. Section40(1) (f) prohibits a workman who is bound by a collective agreement, asettlement under the Act or by an award of an arbitrator of an industrialCourt or of a Labour Tribunal from taking part in a strike with a view toprocuring an alteration, of any of the terms and conditions of thatagreement, settlement or award. Similarly, it would be an offence in termsof section 40(1)(fff) to take part in a strike with a view to procuring thealteration of any order made by a labour tribunal in an application undersection 31B. Section 40(1) (m) prohibits a strike after a dispute has beenreferred for settlement, by arbitration to an arbitratorto an industrial courtor by adjudication to a labour tribunal. These provisions demonstrate thatthe Industrial Disputes Act recognises a basic right of workmen tocommence and to participate in a strike to express their grievances andto win their demands subject to the restrictions and prohibitions that arespecifically laid down. In England, this basic right to strike subject tolimitations has been recognised and upheld over a long period of time. Inthe case of Morgan v Fry (4), Lord Denning M. R. stated as follows:—
“It has been held for over 60 years that workmen have a right tostrike (including therein a right to say that they will not work with non-unionists) provided that they give sufficient notice beforehand: and anotice is sufficient if it is at least as long as the notice required toterminate the contract.”
In India too the basic right of workmen to engage in strikes to expresstheir grievances and to win their demands is well entrenched. Mailhotrain his work titled Dismissal, Discharge, Termination of Service andPunishment (1984/85, 7th Edition, p.344) has stated as follows:—
“ the workers in any democratic State have the right to resort tostrike whenever they are so pleased in orderto express their grievancesor to make certain demands. A strike in the circumstances is anecessary safety valve in industrial relations when properly resortedto”.
Later he states:—
“While the rightto strike remains, the Industrial Disputes Act of 1947imposes certain restrictions”.
Section 22 of the Act requires that prior notice be given of a strike andsection 23 contains certain general prohibitions in relation to strikes. The
scheme appears similar to that of our Industrial Disputes Act of 1950.However, it has to be noted that on a comparison of the provisions theIndian Act appears to be more restrictive of the right to strike.
The basic right to strike has also received international recognition.The International Covenant on Economic, Social and Cultural Rightsadopted by the General Assembly of the United Nations on 16.12.1966which was acceded to by the Government of Sri Lanka on 27.5.1980specifically states, in dealing with the right to form trade unions, in Article8.1 (d) that —
“ The State Parties to the present Covenant undertake to ensure:
The right to strike, provided that it is exercised in conformity with the
laws of the particular country “.
Similarly, the European Social Charter of the Council of Europe inArticle 6 under the heading of the “ Right to Bargain Collectively “recognises the right of workers to collective action in cases of conflicts ofinterest, including the right to strike subject to obligations that might arisecut of collective agreements previously entered into.
Thus it is seen that the view stated by me upon an analysis of theprovisions of the Industrial Disputes Act with regard to the basic right ofworkmen to strike to express their grievances and to win their demands,is not only consistant with the international obligations undertaken by theGovernment of Sri Lanka in ratifying the Covenant on Economic, Socialand Cultural Rights but also consistent with the accepted standards inother national and regional jurisdictions. Therefore, I hold that under ourlaw workmen have a basic right to strike as a measure of collective actiondirected against the employer to express their grievances and to win theirdemands. It is described as a basic right because it is not absolute in itsterms and is subject to restrictions and prohibitions imposed by law.Section 32(2) requires that at least 21 days prior notice be given of a strikein an essential industry. In terms of the definition contained in section 48of the Act an essential industry is one that is declared by the Minister byorder as an industry essential to the life of the community. Section 40 (1)contains specific prohibitions as referred above. These provisions prohibitworkmen from engaging in strikes that are intended to procure thealteration of any of the terms and conditions contained in collective
agreements, settlements entered underthe Act or awards ororders madeby an arbitrator, industrial Court, or a Labour Tribunal.
It has not been contended in this case that the industry of the companyhas been declared an essential industry. Similarly, it has not beencontended that the strike launched by the workmen on 7.9.84 is coveredby any of the prohibitions referred to. In these circumstances it has to beconcluded that the strike itself was lawful.
The next matter to be considered is whether an employer could issuean ultimatum to workmen on a lawful strike requiring them to report forwork before a specified date or in the alternative be considered as havingceased to be employees. In my view such an act on the part of anemployer would be totally inconsistent with the basic right of the workmento engage in a lawful strike to express their grievances and to win theirdemands. The right itself would be empty and devoid of any content if itis subject to the over-riding authority of an employer as stated above.Therefore I hold that an employer could not validly issue an ultimatum toa workman engaged in a lawful strike to report for work before a specifieddate or in the alternative be considered as having ceased to be anemployee. In the circumstances the letter marked V3 which falls into thecategory normally described as notice of vacation of post could not beconsidered as valid or as being capable of producing any legal effect. Ifthis same matter is viewed from another perspective a question wouldarise as to whether workmen on a lawful strike could be considered ashaving abandoned their employment if they defy an ultimatum to reportfor work issued by the employer. As noted above, the underlying basis ofa strike by workmen is an absence on their part of an intention to terminatetheir contracts of employment. In these circumstances their failure tocomply with such an ultimatum as referred to could not constitute anabandonment of employment. The Supreme Court of India in the leading. case of Express News Papers v. Mark (5) considered a similar questionand held that there would be ho abandonment of employment in suchcircumstances. Mudholkar, J. stated in his judgment (at page 1143) asfollows:—
“All that we want to say is that where the employees absentthemselves from work because they have gone on strike with thespecific object of enforcing the acceptance of their demands theycannot be deemed to have abandoned their employment”.
It appears that the same matter has been considered in severalarbitration awards in this country (Industrial and General Workers Unionv. H. W. Pathinayake, I. D. /L. T./ G 19 published in the GovernmentGazette 14,490 of 27.08.65; United Engineering Workers Union v. OceanFood and Trades Ltd., I. DA. T./2/212 published in the GovernmentGazette of 14,789 of 16.02.68). It has been consistently held in theseawards that where workmen stay away pursuant to a demand advancedby them they could not be considered as having vacated post orabandoned their employment. Therefore, when the workmen named inthe charge and the other workmen engaged in the strike failed to reportfor work on 27.09.84 pursuant to the purported vacation post notice V3,in my view they did not by such conduct abandon their employmentbecause at the material time they were engaged in a lawful strikepursuant to a demand they had made of the Company. The employer-employee relationship between the parties continued and was subsistingas at 07.01.1985 being the date of the offence.
The other submission made by learned President’s Counsel is that theprosecution has failed to establish the element of mens rea of the offenceunder section 40 (1) (i). It was submitted that when the words of section40 (1) (i) are read together with the definition of the term “lock-out” in theTrade Unions Ordinance, it is incumbent on the prosecution to establishthat the accused committed the acts constituting a lock-out against the
workman “with a view to compelling those personsto accept terms or
conditions of an affecting employment". It was contended that as a resultof the strike the Company lost its export orders and had no work to offerto the workmen concerned. That, they were kept away from work for thatreason alone and not for the reason of compelling them to accept anyterms or conditions of or affecting employment. Learned State Counselurged several matters that militate against this inference.
They are —
That in the letter marked V3 it is stated that if the workmen do notreport for work the Company will “recruit other labour". This showsthat the Company had geared itself to continue with their work inthe absence of the workmen concerned;
The evidence of witness Wijedasa Silva, Assistant Commissionerof Labour that when he visited the factory of the Company inMarch, 1985 (two months after the commission of the offence) he
found persons working in the factory which suggests that theindustry was functional long after the day the Company claimedthat it had to close business.
The E. P. F. declaration forms that have been produced withoutchallenge show that the Company had sent in declarations inrespect of a number of workmen for the first six months in 1985;
When the workmen reported for work on 07.01.85 the Companydid not adduce as a reason for keeping them away the fact thatthey had no work to offer. Further the Company had not adducedthis excuse in response to the letters sent by the Union and theAssistant Commissioner of Labour;
That even if the Company had no work to offer the proper coursewould have been to make an appropriate application in terms ofthe Termination of Employment of Workmen (Special Provisions)Act, No. 45 of 1971 and not to contravene the specific provisionsof section 40 (1) (i) of the Industrial Disputes Act, which in effectrequires an employer to offer work to workmen when the disputeby employer had with the workmen is referred for settlement by anorder of the Minister made in terms of section 4 of the Act.
These matters in my view negative the contention of the Company thatit refused to employ the workmen who returned to work after the strikebecause it had no work to offer them.
On the other hand it is clear from the evidence that the persistent standof the Company was that the workmen on strike should return to workwithout insisting on their demand for the reinstatement of the 10 fellowworkmen who had been dismissed. In these circumstances it has tonecessarily be inferred that the Company locked-out the workmenconcerned with a view to compelling them to accept certain conditionsaffecting employment namely that they should drop their demand for thereinstatement of the fellow workmen.
For the reasons stated above I see no merit-in the two grounds urgedby learned President's Counsel forthe Appellant Company. I accordinglyuphold the conviction and the sentence that has been imposed.. Theappeal is dismissed.
Appeal dismissed.