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The other witness, who was from the Human ResourcesDepartment had not been able to state as to what he had heard orseen at the relevant time.
In the aforementioned circumstances, the Labour Tribunal hadcorrectly come to the conclusion that on a consideration of thetotality of the evidence led, the allegations, which are questions offact, have been proved on a balance of probability. The High Courtas stated earlier had gone on the basis that hearsay evidence isadequate and that there is no necessity to call for witnesses interms of the Evidence Ordinance.
It is not disputed that a workman or a trade union on behalf ofa workman, who is a member of that union, could make anapplication to a Labour Tribunal for relief or redress in respect of:
the termination of his services by his employer;
the question whether any gratuity or other benefits are dueto him from his employer on termination of his services andthe amount of such gratuity and the nature and extent of anysuch benefits; and
such other matters relating to the terms of employment orthe conditions of labour, of a workman as may beprescribed. (Section 31B(1) of the Industrial Disputes Act)
Section 31C(1) of the Industrial Disputes Act deals with theduties and powers of a Labour Tribunal with regard to theapplications in terms of Section 31B of the Industrial Disputes Act.The said Act clearly states that it shall be the duty of the LabourTribunal to make all such inquiries into the specific applicationmade and hear all such evidence and make such order, which isjust and equitable. According to section 31C(1) of the IndustrialDisputes Act,
"Where an application under section 31B is made to a labourtribunal, it shall be the duty of the tribunal to make all suchinquiries into that application and hear all such evidence asthe tribunal may consider necessary, and thereafter makesuch order as may appear to the tribunal to be just andequitable" (emphasis added).
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The need to hear all such evidence in order to properly inquireinto the application made by a workman had been considered bySirimane, J., in Urban Council, Panadura v Cooray(A), where it hadbeen stated that, though an employee's application for reliefbefore a Labour Tribunal should be heard with sympathy andunderstanding, yet the Tribunal must act judicially. Moreimportantly it was held that the Labour Tribunal should not shut itseyes to positive evidence. Further in United Engineering Workers'Union v DevanayagamM, it was clearly stated that the paramountconsideration by a Labour Tribunal is the need for a just andequitable solution and for this purpose, what is necessary is to dojustice between the parties to the application.
Learned Judge of the High Court referred to the documentsmarked as R3 and R4 and had held that by these documents theappellant had been primarily warned by the respondent and thatthe learned President of the Labour Tribunal had not paid anyattention to the contents of these documents.
An examination of R3 clearly indicates that the position takenby the learned Judge of the High Court, is not correct. The saiddocument (R3) dated 24.02.1999 is a letter issued not to theappellant directly, but to all the Supervisors, indicating steps theyshould take to avoid mistakes and to maintain good supervision.This document had been issued by the Chairman of therespondent Company. The document marked as R4 dated
was issued to the appellant by the Human ResourcesManager of the respondent Company regarding the 'BusbahnhufDingelstaedt Project' and had drawn the attention of the appellantto his obligations as a Supervisor to advice the work force in orderto avoid mistakes. This letter indicates that the Company hadissued certain guidelines for the Supervisors to follow regardingsupervision in order to avoid mistakes and obtain a high yield fromthose projects they had undertaken. Therefore, a careful perusalof the order of the Labour Tribunal clearly shows that the positiontaken by the High Court in this regard is not correct. In fact theLabour Tribunal had considered the issue based on thedocuments marked R3 and R4 and had come to the conclusionthat R3 is a document, which was a kind of a general circularissued to all the Supervisors and R4 also gave general instructions
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based on the role of the appellant as a Supervisor. Accordingly, theLabour Tribunal had taken the view that on a balance of probabilitythe respondent had not been able to prove past bad conduct of theappellant.
It is therefore apparent that whilst the learned President of theLabour Tribunal had considered the application after evaluatingthe evidence before him, the learned Judge of the High Court hadbeen of the view that there is no necessity for the respondent tojustify its decision to terminate the services of the appellant, sincethe latter had given his consent at the time of acceptance of hisletter of appointment for such termination. The High Court had forthis purpose, referred to clause 13 of the letter of appointmentdated 30.05.1997 (R2). The said clause reads as follows:
“TerminationYour employment with the Company after confirmationmay be terminated by either party giving one month'snotice or by paying an amount equivalent to one (01)month's remuneration. However, the employer reservesthe right to terminate this contract of employment withoutsuch notice or payment or remuneration for reasons ofinsobriety, insubordination, gross neglect in the basicduty, misconduct or theft.
During the existence of laissez-faire state, the employer-employee relationship was based on the common law principlesand it was an accepted fact that an employer could give effect towhat the employer and employee had agreed upon at thecommencement of their relationship. Referring to the applicabilityof common law concepts and its input on the contract ofemployment. S.R. de Silva (The Contract of Employment, mono-graph No. 4, 1983, pg. 2) states that,
"There was a time when the common law regarded anemployer as having a proprietary right in his servant withcriminal sanctions attaching to breaches of contract byemployees. It is this concept that made a stranger
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wrongly injuring a servant liable not only to the servant,but also to the master. Even though the common law hascome a long way since that time, in the modern commonlaw the contract of employment is still considered moreor less conclusive in determining the rights of the partiesand it implies rights and duties only in the absence ofcontractual terms. This attitude is based on thefundamental misconception of the common law that thecontract of employment is a voluntary agreemententered into between parties of equal bargainingstrength. The common law looks upon employment as amere contractual relationship between two partiesterminable at the will of either party, subject to thecondition of notice in certain cases."
These concepts of common law that gave prominence to therights and duties of employees under their contractual terms,which were taken into consideration by the learned Judge of theHigh Court in deciding this appeal, are no longer applicable in ourlegal system. Along with the collapse of the laissez-faire state andwith the emergence of the modern welfare state, countries hadtaken steps to establish special systems of Courts for the purposeof granting just and equitable orders. In Sri Lanka, the IndustrialDisputes Act came into being to provide for the prevention,investigation and settlement of industrial disputes and for mattersconnected therewith or incidental thereto. Labour Tribunals wereestablished under and in terms of the said Act and Section 31B4clearly states that,
"Any relief or redress may be granted by a labourtribunal to a workman upon an application made undersubsection (1) notwithstanding anything to the contraryin any contract of service between him and his employer"(emphasis added).
It is therefore quite clear that the common law principles statedearlier are no longer applicable in Sri Lanka with regard to labourdisputes and as stated by Lord Devlin in United EngineeringWorkers' Union v Devanayagam (supra),
It is to be noted that although this position would have beencorrect under the common law, where either party was entitled toterminate the contract of employment in accordance with itsprovisions without any consequential effect, the introduction ofLabour Laws had modified this position. Through theestablishment of the Labour Tribunals, the common law conceptsdealing with labour relations were changed, and the IndustrialDisputes Act, as stated earlier, expressly provided for a LabourTribunal to take action, notwithstanding anything to the contrary inthe contract of service between an employer and his employee. Infact in the well known case of the United Engineering Workers'Union v Devanayagam (supra), Lord Devlin, referring to Section31B(4) of the Industrial Disputes Act empowering a LabourTribunal to grant relief contrary to the terms of a contract ofservice had said that,
"Indeed in this sub-section the statute is doing no morethan accepting and recognising the well known fact thatthe relations between an employer and his workman areno longer completely governed by the contract ofservice."

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Skyspan Asia (Pvt.) Ltd. (Dr. Shirani Bandaranayake, J.)
"The common law of master and servant has fallen intodisuse."
The High Court however had quite contrary to the aforesaidposition had gone on the basis that, in terms of clause 13 of theletter of appointment, the respondent could have terminated theservices of the appellant.
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In these circumstances, it is apparent that the High Court hadbased its decision in terms of the common law applicable toemployer-employee relationships and had failed to appreciate thechanges that had taken place in the legal concepts dealing withlabour disputes, since the introduction of the Industrial DisputesAct in this country.
Accordingly, on a careful consideration of the aforementioned,it is apparent that the approach taken by the High Court in decidingthis application cannot be accepted.
For the reasons aforementioned, the questions, which were setout at the out set of this judgment are answered as follows:
Learned Judge of the High Court had not considered theevidence led in this case in the correct perspective, takinginto consideration that the learned President of the LabourTribunal is only expected to make a just and equitableorder.
the approach to the matters in dispute by the learned Judgeof the High Court is erroneous.
Accordingly I allow the appeal, set aside the judgment of theHigh Court dated 20.09.2005 and affirm the order of the LabourTribunal dated 30.06.2003. The respondent is directed to reinstatethe appellant with effect from 01.01.2009 with back wages, asdirected by the Labour Tribunal from 27.07.2000 upto 01.01.2009,where his monthly salary was agreed upon Rs. 10,500/-
I make no order as to costs.
Appeal allowed.