Supreme Court asks Bata India to pay full wages to workers in a month

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In a setback to Bata India, the Supreme Court on Tuesday asked the shoe manufacturing company to pay full wages to its workers within a month but allowed it to take appropriate action for the “go slow” strategy adopted by the workmen.

While vacating the stay on its August 24, 2009 order that allowed Bata to pay reduced/deducted wages till the disposal of the case, a Bench comprising justices Ajay Rastogi and Sanjiv Khanna upheld the Karnataka High Court’s 2008 judgment that partly favoured workmen. “This means that full wages would be paid. We do not feel it will be appropriate to direct factual investigation or resort to the procedure of issue of notice, reply etc. at this belated stage,” the apex court said.

The Bench noted that the workmen union had accepted the High Court’s findings that pro-rata deduction/reduction in wages was permissible if there was a deliberate attempt to not produce or do work by resorting to a “go slow” strategy.

“We perceive and believe that the HC judgment protects the interest of the appellant (Bata) and the workmen by prescribing the right procedure which should be followed in case the appellant is of the opinion that the workmen, though present on duty, are not working and are not giving the agreed production on the basis of which wages and incentives have been fixed. This would depend upon the factual matrix and have to be ascertained in case of dispute to render any firm opinion. The procedure prescribed should be followed,” the judges said.

Bata India and its workmen association had entered into the two settlements in March and December 1998 by which the latter had agreed to produce a minimum of 1,200 pairs of shoes per shift. The weekly target for production was fixed at 21,600 pairs of shoes in three shifts working per day. The norm for calculation of incentive on production was fixed at 12,960 pairs of shoes per week.

Bata through counsel Neeraj Shekhar alleged that after February 2001 the workmen had deliberately adopted “go slow” tactics and failed to produce the minimum agreed production, which fell below 50% of the normal production. Despite repeated requests and warnings, the workmen did not pay any heed and consequently, the company paid pro-rata wages to those not meeting the target. However, the workmen refused payment and resorted to a stay-in strike, thus leading to a lockout from March 8 to July 3, 2000. The workmen resumed work on February 12, 2001.

The HC in April 2008 had held that “go slow” is nothing but a sort of intentional refusal to work and the management in such a situation could be justified in reducing or paying pro-rata wages. It further observed that the workmen, 40 in number, had given normal production but a significantly large number had deliberately not given adequate production given the call to “go slow”.

However, the HC held the company at fault, saying it should have allowed workmen to clarify their stand before making any deduction on a pro-rata basis and had asked the management to pay deducted wages to the employees within a month. The HC had given liberty to Bata to take appropriate steps and proceed by law on the “go slow” strategy adopted by a large section of the workmen.