Order directing payment of full back wages to Class III & IV employees modified in the light of the immense financial burden it would cause to LIC

Supreme Court: In the revision petition filed against the order directing LIC to pay full back wages to it’s employees, the Court was of the opinion that though the aspect of financial hardship would not be a sufficient ground to warrant interference in a case, but keeping in view the fact that LIC is a statutory Corporation operating in the interest of the public at large, on the limited point of payment of full back wages to the temporary and badli workers who are entitled for regularisation, the matter could be revisited.

The Court noticed that the temporary and badli workers of LIC, who are entitled for regularisation as permanent workmen in terms of the impugned judgment and order dated 18.03.2015 passed by this Court, are held to be entitled to full back wages as well. However, keeping in mind the immense financial burden this would cause to LIC, the Court modified the relief only with regard to the back wages payable and therefore, we award 50% of the back wages with consequential benefits. It was directed that the back wages must be calculated on the basis of the gross salary of the workmen, applicable as on the date as per the periodical revisions of pay scale. The Court said that the periodic revisions of pay of basic salary, as submitted by LIC, along with other component figures comprising the gross salary including Dearness Allowance, House Rent Allowance etc. etc., as applicable, must be accounted for while computing the amount due to the workmen towards the back wages.

Considering the fact that the order has been passed in favour of workmen and the dispute is being litigated for nearly 25 years, the bench of V. Gopala Gowda and C. Nagappan, JJ directed LIC to comply pay the back wages within 8 weeks from the date of the order. [Tamil Nadu Terminated Full Time Temporary LIC Employees Association v. S.K. Roy, 2016 SCC OnLine SC 805, decided on 09.08.2016]