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PETITIONER: WORKMEN OF THE CALCUTTA ELECTRIC SUPPLYCORPORATION LTD.

       Vs.

RESPONDENT: CALCUTTA ELECTRIC SUPPLY CORPORATION LTD.

DATE OF JUDGMENT01/05/1973

BENCH: REDDY, P. JAGANMOHAN BENCH: REDDY, P. JAGANMOHAN VAIDYIALINGAM, C.A.

CITATION:  1973 AIR 2138            1974 SCC  (3) 177

ACT: Industrial  Dispute-Overtime wages, rate of-Payment for  all working hours in excess of Prescribed working hours must  be at special rates and not at time rates.

HEADNOTE: Different categories of employees of the respondent  company had different weekly hours of work prescribed for them.  The weekly  hours for some were 48, for others 40 and  for  some others  35.   Overtime was paid to different  categories  of workmen  at different rates and was calculated by  different systems.   In an industrial dispute between the company  and its workmen the Tribunal held that all employees were to get overtime  for any period in excess of their weekly hours  of work  but  less than 48 hours a week. at their  time  rates. For  periods exceeding 48 hours a week all workmen  were  to receive,  overtime  wages at 1 1/2  times  their  respective time-rates.   In  appeal  by  special  leave  the  appellant workmen contended that if an employee had to work beyond his scheduled  working hours he should get proportionately  more wages for each of such extra hours. HELD  :  The decision of this Court in  Indian  Oxygen  Ltd. requires  payment of overtime wages for all hours in  excess of  the prescribed working hours at special  overtime  rates and. not at time-rates.  In view of this decision, which  is binding,  the  appeal  must be  Allowed.   Overtime  to  the appellants  must be paid for at 11/2 times the  hourly  rate for  all  hours of work beyond the scheduled hours  and  not merely for hours of work beyond 48 hours in a week. [140H] [With the consent of the parties the Court further  directed that  in  respect of the past period overtime  payments  for hours of work in excess of the scheduled hours upto 48 hours should  be at 11/4 times the hourly rate which  the  company had already paid in terms of the Award]. Indian  Oxygen Ltd. v. Their Workmen, [1969] 1  S.C.R.  550. followed.

JUDGMENT: CIVIL  APPELLATE  JURISDICTION : Civil Appeal  No.  1924  of 1968. Appeal  by special leave from the.  Award dated January  31,

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1968 of the IInd Industrial Tribunal, West-Bengal,  Calcutta in Case  No.  VII-65 of 1967  published  in  the  Calcutta Gazette dated February 29, 1968. R.   K. Garg, S. C. Aggarwala, and Haroobhai Mehta, for  the appellant. P.   P.  Ginwalla, Arijit Chauduri, Bhuvanesh Kumari and  O. C. Mathur, for the respondent. The Judgment of the Court was delivered by MUKHERJEA,  J.  This appeal by special leave from  an  Award dated  31  January 1968 of the Second  Industrial  Tribunal, West   Bengal,   relates  essentially  to  the   manner   of calculation  of  overtime  wages  for  nonfactory  personnel (including  the  members  of  the  clerical  staff)  of  the Calcutta  Electric  Supply  Corporation  Ltd.   (hereinafter referred to as the Company).  The question that was referred to the Tribunal for 139 adjudication was framed by the Government of West Bengal  in its order of reference in the following manner               "How    wages   for   non-factory    personnel               (including the members of the clerical  staff)               should  be calculated and the date from  which               overtime  wages for such personnel  should  be               thus calculated ?" The  Tribunal in its Award directed that the  overtime  rate for nonfactory personnel should in no case be less than  the time-rate.   The Tribunal further directed that no  employee should get overtime at more than the time rate until he  has completed 48 hours a week but that as soon as he exceeds  48 hours,  the  overtime rate should be 11/2 timer,  the  time- rate.   This  rate of overtime wages in favour of  the  non- factory personnel was directed to be given effect to from  4 February 1967 which was the date of reference.  The  workmen of the company have now come on appeal against the  decision of  the  Tribunal  in so far as  the  Tribunal  limited  the overtime  wages to the time-rate for any period short of  48 hours a week. It  appears  that different categories of employees  of  the company  have different weekly hours of work prescribed  for them.   The weekly hours for some are 48, for others 40  and for some others 35.  The learned Tribunal seems to have been impressed  by the fact that overtime was paid  to  different categories of workmen at different rates and that they were calculated  by different ’systems.  The Tribunal  tried  to, rationalise  the  situation  by  providing  the  payment  of overtime at uniform rates to all employees up to 48 hours  a week : all employees were to get overtime for any period  in excess of their weekly hours of work but less than 48  hours a week at their time-rates.  For periods exceeding 48  hours a week, however, all workmen were to receive overtime  wages at  1-2 1/2 times their respective time-rates.  This is  how the, Tribunal according to the respondent company sought  to establish  uniformity in the matter of payment  of  overtime wages.   The appellants contended that payment of wages  for overtime  at  the  time-rate cannot  be  taken  as  overtime payment  at  all.   If an employee has to  work  beyond  his scheduled  working hours he should get proportionately  more wages  for  each such extra hour.  The respondent  tried  to meet this grievance by saying that in some cases the  weekly hours of work were less than 48 only because in the  centres concerned,  there  was  not  sufficient  work  to  keep  the employees busy for 48 hours every week.  Even so the company would  have  been at liberty to fix 48 hours as  the  weekly hours of work for all employees.  The fact that in the  case of certain employees they fixed a shorter period should not,

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they say, go against the company and they should be  allowed to make the employees work up to 48 hours a week on  payment of overtime wages at the time-rate.  It was pointed out that the award of the Tribunal did not enable the company to  get overtime  work without payment of extra wages.  All that  it permitted the company to do was to pay overtime wages at the time-rate  up to 48 hours a week, This provision meant  that up  to  lone  point all Workers were  placed  on  the,  same uniform  basis.  After that point had been reached i.e.,  to say for any period of overtime beyond 48 hours a week,  the, employees were to get overtime wages at time-rates. 140 The  point  for decision, in our opinion, is  one  which  is completely ,covered by the decision of this Court in  Indian Oxygen Ltd. v. Their Workmen.(1) In that case the  employees made  various  demands of which demand No. 3 was  that  "the payment of overtime to office’ staff should be 1 1/2  times the  ordinary  rate  beyond their normal  duty  hours".   As regards  this demand the contentions urged on behalf of  the appellant  company  were two-fold.  First,  that  under  the Bihar Shops and Establishments Act the company could be made liable  to  pay for overtime ’work at the rate  provided  in that  Act, viz., at double the ordinary rate when a  workman was  asked to work beyond 48 hours per week as  provided  in that  Act.  Therefore, it was argued, the appellant  company could  not  be asked to pay more than the ordinary  rate  of wages payable to workmen if they were asked to work  beyond 39  hours  but  not exceeding 48 hours.   Secondly,  it  was argued,  that  if  the  company were to  pay  to  times  its ordinary rate of wages for overtime it would be paying  more than other similar concerns.  This Court rejected both these ,contentions.   Shelat J. who delivered the judgment of  the Court  made ;the following observations regarding the  first contention :-               "In  our judgment both these  contentions  are               unsustainable.    Under  the   conditions   of               service  of the company, the "total  hours  of               work  per  week are 39  hours.   Only  workman               asked   to  work  beyond  these  hours   would               obviously be working overtime and the  company               in  fairness  would  be expected  to  pay  him               compensation  for  such  overtime  work.   The               Bihar  Shops  and Establishments  Act  has  no               relevance  to this question as that Act  fixes               the maximum number of hours of work  allowable               thereunder, i.e., 48 hours a week and provides               for double the rate of ordinary wages for work               done-over  and  above 48 hours.   It  is  not,               therefore,  as if the provisions of  that  Act               govern overtime payment payable by an employer               where  maximum hours of work are  governed  by               the  conditions  service  prevailing  in   his               establishment.  Therefore, no reliance can  be               placed  on the provisions of that Act for  the               company’s contention that it cannot be  called               upon to pay for ,overtime work anything  more.               than its ordinary rate of wages if the workmen               do  work beyond 39 hours but not exceeding  48               hours  a  week.   It is obvious  that  if  the               company   were  asked  to  pay  at  the   rate               equivalent  to the ordinary rate of wages  for               work done beyond 39 hours but not exceeding 48               hours work a week, it would be paying no extra               compensation  at all for the work done  beyond               the  agreed hours of work.  The company  would

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             in  that  case be  indirectly  increasing  the               hours  of work and consequently  altering  its               conditions of service." In view of this decision the matter is no longer res integra and  we  are bound by the previous decision. 1  Mr.  Ginwala appearing for the respondent sought to argue that what  this Court  had disallowed in the Indian Oxygen Ltd.’s  case  was non-payment  of  extra wages for the extra  ’hours  of  work beyond the normal Weekly hours until they exceeded 48 hours of work per week.  It was argued that the real ratio of the deci- (1)  [1969] 1 S.C.R. 550. 141 sion in that case was that the workmen should be entitled to overtime wages only for a period in excess of the prescribed monthly  workings,  hours.  This is not, in our  opinion,  a correct  construction  of  that decision  where  this  Court clearly referred to the rate of payment for the extra  hours of work.  We, have no doubt in our mind that the decision in that  case requires payment of overtime wages for all  hours in  excess  of  the  prescribed  working  hours  at  special overtime rates and not at time-rates. In  this  view of the matter we felt inclined to  allow  the appeal  and  to set aside the Award of the Tribunal  and  to direct  that overtime is to be paid for at 1 1/2  times  the hourly rate for all hours of work beyond the scheduled hours and not merely for hours of work beyond 48 hours in a  week. This  was to apply as from the date of our order.   It  was, however, represented to us on behalf of the company that  in respect of the period between the date of the Award and  the date, of our judgment, the total amount involved as a result of this increase proposed to be sanctioned by us in overtime rate  will be about Rs. 60 lakhs which the company, we  were told,  has  not  the  capacity  to  pay.   This  might  have necessitated.  a remand to the Tribunal on the  question  of capacity but the counsel for both the parties have in  order to  _avoid any delay in the disposal of the  matter  agreed- very   rightly  and  properly,  ’in our  opinion, to   a suggestion  made  by us that in respect of the  past  period overtime,  payments  for  hours  worked  in  excess  of  the scheduled hours up to 48 hours should be at times the hourly rate  instead  of  the hourly rate  which  the  company  has already  paid  in terms of the Award.  The arrears  will  be paid  by 12 equal instalments over a period of 2 years.   We therefore order accordingly.  The parties will pay and  bear their own costs. G.C. 142