Page 245 - DMGT306_MERCANTILE_LAWS_II

Mercantile Laws – II

Notes
customary or contract bonus was urged before the Arbitration Board such a ground was
barred by the general principles of res judicata.
Dismissing the Appeal
In an industrial dispute the process of conflict resolution is informal, rough and ready and
invites a liberal approach. Technically the union cannot be the appellant, the workmen
being the real parties. There is a terminological lapse in the cause title, but a reading of the
petition, the description of the parties, the grounds urged and grievances aired, show that
the battle was between the workers and the employers and the Union represented the
workers. The substance of the matter being obvious, formal defects fades away. Procedural
prescriptions are handmaids, not mistresses of justice and failure of fair play is the spirit
in which Courts must view processual deviances. Public interest is promoted by a spacious
construction of locus standi in our socio-economic circumstances, conceptual
latitudinarianism permits taking liberties with individualisation of the right to invoke
the higher courts where the remedy is shared by a considerable number, particularly
when they are weaker. In industrial law collective bargaining, union representation at
conciliations, arbitrations, adjudications and appellate and other proceedings is a welcome
development and an enlightened advance in industrial life. [597G] In the instant case the
union is an abbreviation for the totality of workmen involved in the dispute. The appeal
is, therefore, an appeal by the workmen compendiously projected and impleaded through
the union. [598D] 592
The demands referred by the State Govt. under sec. 10(1) (d) of the Industrial Disputes Act,
specifically speak of payment of bonus by the employers which had become custom or
usage or a condition of service in the establishments. The subject matter of the dispute
referred by the Government dealt with bonus based on custom or condition of service.
The Tribunal was bound to investigate this question. The workers in their statements
urged that the demand was not based on profits or financial results of the employer but
was based on custom. The pleadings, the terms of reference and the surrounding
circumstances support the only conclusion that the core of the cause of action is custom
and/or term of service, not sounding in or conditioned by profits. The omission to mention
the name of a festival as a matter of pleading did not detract from the claim of customary
bonus. An examination of the totality of materials leads to the inevitable result that what
had been claimed by the workmen was bonus based on custom and service condition, not
one based on profit.

Question
Critically analyse the above case.

Source: http://indiankanoon.org/doc/191016/
12.6 Summary

 The Payment of Bonus Act, 1965 (Act No. 21 of 1965) is an important law on the topic of
wages and bonus.

 The Payment of Bonus Act, 1965 is the principal act for the payment of bonus to the
employees which was formed with an objective for rewarding employees for their good
work for the organization.
 It is a step forward to share the prosperity of the establishment reflected by the profits
earned by the contributions made by capital, management and labour with the employees.

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