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Judgment
K. Chandru, J.—In all these writ petitions, the prayer of the petitioners, who are beedi manufacturers, is to quash the order of the first
respondent/State made in G.O.(2D) No. 45 Labour and Employment Department dated 15.7.2004.
By the said notification, the Government has fixed the minimum wages in respect of employments in ""Tobacco including Beeding making other
than beedi rolling"".
According to the petitioners, the Government fixed the minimum rates of wages in respect of several categories of employees engaged in
employments in the ""Tobacco including beedi making factory other than beedi rolling"" by G.O. Ms. No. 1093 Labour and Employment
Department dated 9.6.1989. In that notification, the following rates were fixed, which is as follows:
S. Class of Employees Minimum rates of wages
No. (1) (2)
I Labelling (all kinds
of size labelling)
Single Wrapper 12 per one lakh beedies
Double Wrapper 13 per one lakh beedies
Ring Labelling 0.75 per 1,000 beedies
Once again a draft notification was issued on 23.8.1993 proposing to revise the minimum rate of wages. A final notification dated 20.4.1998 in
G.O.2(D) No. 14, Labour & Employment (J1), dated 20.4.1998 was issued superceding the notification dated 9.6.1989 revising the wages. With
reference to the present controversy, the wages fixed for labelling which is as follows:
S. Class of Employees Minimum rates of wages
No. (1) (2)
I Labelling (all kinds
of size labelling)
Single Wrapper 24.00 per one lakh beedies
Double Wrapper 26.00 per one lakh beedies
Ring Labelling 1.50 per 1,000 beedies
It was contended by the petitioners that while notifying categories of employment, ""Top labelling"" was not included in the G.O.,. However, by a
further notification dated 29.7.1999 in G.O.(2D) No. 91, Labour and Employment, the notification dated 20.4.1998 was superceded on the basis
of the circumstances explained by the Commissioner of Labour vide his letter dated 1.7.1999.
It was thereafter, the Government issued G.O.Ms. No. 68 Labour and Employment dated 20.4.2001 and appointed an Advisory Committee to
advise the Government on the revision of rates of wages. The committee so formed comprised of the following persons:
Deputy Commissioner of Labour
Tirunelveli Chairman
Labour Inspector, Tirunelveli Secretary
Thiru. M.Sheik Farid Independent Member
Employers'' Representatives:
Thiru A. Mohammed Shariff
S"" Beedi, Chennai Member
Thiru. V.R. Anwar Batcha
100 Mark Beedi, Vellore Member
Thiru A.M. Masthan,
Sayyedu Beedi, Tirunelveli Member
Employees'' Representatives:
Thiru M. Rajangam (CITU),
Tirunelveli Member
Thiru P.S.A. Salaam (AITUC),
Erode Member
Thiru K. Gopal (LPF),
Gudiyatham Member
The committee held sittings at Tirunelveli, Vellore, Chennai, Tiruchi, Salem, Erode, Mayiladuthurai and Thanjavur. It was stated in the sittings at
Tirunelveli, of the three employers'' representatives, A.M.Masthan alone was present. The committee after a serious deliberation submitted its
report on 29.8.2002. The committee recommended a separate wage for the ""ring labelling"" at the rate of 25% of the back wages where Top
Labelling is being done.
Based upon the report of the Advisory Committee, the Government issued G.O.Ms.(2D) No. 45 Labour and Employment Department dated
15.7.2004 revising the rates of minimum wages of beedi workers. It is this order which is under challenge in all these writ petitions.
In the impugned order, the following wages were notified:
Price-rated wages:
For Labelling 4000 Litho
Wrapper on 4000 Bundles Rs. 125/- per Day
Explanations:
(i) Each Bundle consisting of 25 beedies.
(ii)Proportionate wages should be paid for labelling the bundles consisting of 10, 15 or Beedies per bundle.
(iii) 30% extra wages should be paid for labelling ""Top Label"" and Dearness allopwance should also be paid with it.
Ring Labelling:
(For Ring Labelling gum and
thread should be supplied by Rs. 5/- per
the management) 1000 beedies
One day work means making 10,000 beedies per day.
Explanations:
Dearness Allowance: In addition to the Minimum Wages fixed above, the employee shall be paid Dearness Allowance as indicated below:
Explanations:
(i)The Dearness Allowance in linked to the Average Chennai City Consumer Price Index Number for the year 2000 i.e. 475 points (with base
1982=100) and for every rise of one point over and above 475 points, an increase of Rs. 5/- (Rupees five only) per month shall be paid as
Dearness Allowance.
(ii) The dearness allowance shall be calculated every year on the 1st April on the basis of the average of the indices for the preceding 12 months,
namely from January to December.
(iii)The first calculation shall thus be effective from the date of publication of the Notification in the Tamil Nadu Government Gazette based on; the
average of Chennai City Consumer Price Index Number for the previous years.
Where the nature of the work in the name, no distinction in the payment of wages ahll be made between men and women workers.
To arrive at the daily wages, the monthly wages shall be divided by 26.
To arrive at the monthly wages, the daily wages shall be multiplied by 30.
Wherever the existing wages are higher than the minimum wages fixed herein, the same shall be continued to be paid.
The grievances of the managements are that the Notification was based upon the report of the committee constituted by an order dated
20.4.2001 and therefore, the report dated 30.9.1999 cannot have any role to play while issuing such a notification.
It was submitted that the fixation of minimum wages in the present case is beyond the competency of the Government in terms of Section 5 of
the Minimum Wages Act. The Government had erred in going beyond its jurisdiction and the impugned notification introduced a new element viz.,
30% extra wages for Top Labelling with dearness allowance. It had ignored the fact that labelling hitherto was done by the workers is inclusive of
top labelling i.e. outer label of bundles. By this notification, hitherto, the work done by the same person has been split up into two works thereby
increasing the cost of production.
It was further argued that by pasting the trade mark label on the packet (known as ""kattu"") does not involve any serious work so as to make
30% extra payment of wages. By the present notification, in the name of revision of wages, they have introduced a new element of top labelling
and fixed a separate payment. The Government has also ignored the letter written by the employers'' association such as the South Tamil Nadu
Beedi Manufacturers Association, which requested the Government to include their members also as members of the Advisory Committee. This
had resulted in person being nominated by the committee not being a stake holder. The resultant wages fixed by the Government was higher than
the minimum wages fixed in the States of West Bengal, Madhya Pradesh, Karnataka and Uttar pradesh. By the thoughtless measure, the wages
have been increased many times without taking into account the actual nature of work involved. By the notification of the year 1989, the difference
between single wrapper and double wrapper was only one rupee whereas by the new element of top labelling results in payment of 30% extra
wages apart from Dearness Allowance and this will increase the cost of production exorbitantly.
Heard the arguments of Mr. S. Silambannan, learned Senior Counsel appearing for Mr. S. Karthik for petitioners, Mr. AR. L. Sundaresan,
learned Senior Counsel appearing for AL. Ganthimathi for petitioners in the respective Writ Petitions, Mrs. V. Chellammal, learned Special
Government Pleader for all the Official Respondents and Mr. S. Arunachalam, learned Counsel for the impleaded respondents and have perused
the records.
Since the Government filed no counter affidavit, the learned Special Government Pleader was directed to produce the original G.O. file in
G.O.Ms.(2D) No. 45 Labour and Employment Department, dated 15.7.2004. Accordingly, the learned Special Government Pleader submitted
the file for perusal by this Court.
With reference to the defect in the composition of the committee, factually, such a situation does not arise. Whether a particular member sat at
a particular hearing at Tirunelveli is immaterial and also some of the members from the Southern Districts were not included cannot be a relevant
factor when the minimum wages is fixed for the whole State and the employers'' interest was well protected. In fact, the employers'' representatives
were drawn from three places viz., Chennai, Vellore and Tirunelveli. If Mr. A.M. Masthan, who had not chosen to participate at the Advisory
Committee sittings at Tirunelveli, the Government cannot be blamed for the absence of the one of the member. Ultimately, the report is the product
of cumulative effort of all concerned and therefore, no exception can be taken about composition of the said committee.
The Supreme Court vide its judgments in The Edward Mills Co. Ltd., Beawar and Others Vs. The State of Ajmer and Another, and also in
Bijay Cotton Mills Ltd. Vs. The State of Ajmer, dealt with the fixation of minimum wages. In the former case, it was observed that the legislative
policy is apparent on the face of the enactment. What it aims at is the statutory fixation of the minimum wages with a view to obviate the chances of
exploitation of labour. It is to carry out the purpose of the enactment that power has been given to the appropriate Government to decide with
reference to local conditions whether it is desirable that minimum wages should be fixed in regard to a particular trade or industry.
In Bijay Cotton Mills Ltd.''s case (cited supra) while dealing with Section 5(c), the Supreme Court had observed as follows:
As regards the procedure for the fixing of minimum wages, the ''appropriate Government'' has undoubtedly been given very large powers. But it
has to take into consideration before fixing wages, the advise of the committee if one is appointed, or the representations on its proposals made by
persons who are likely to be affected thereby. Consultation with advisory bodies has been made obligatory on all occasions of revision of minimum
wages, and Section 8 of the Act provides for the appointment of a Central advisory Board for the purpose of advising the Central as well as the
State Government both in the matter of fixing and revision of minimum wages. Such Central advisory body is to act also as a co-ordinating agent
for co-ordinating the work of the different advisory bodies., In the committees or the advisory bodies the employers and the employees have an
equal number of representatives and there are certain independent members besides them who are expected to take a fair and impartial view of the
matter. These provisions in our opinion, constitute an adequate safeguard against any hasty or capricious decision by the ''appropriate
Government''. In suitable cases the ''appropriate Government'' has also been given the power of granting exemptions from the operation of the
provisions of this Act.
It is relevant to point out that the Tamil Nadu legislature by amending Section 9A has introduced a new provision in the Minimum Wages Act
by T.N. Act 47 of 1981 with effect from 1.10.1981, and the new section reads as follows:
Section 9A. Saving - No order of the State Government nominating any person as the Chairman or a Member of the Advisory Board or a
Committee or Sub-Committee shall be called in question in any manner and no action or proceedings before any Board, Committee or Sub-
Committee shall be called in question in any manner in any Court of law on the ground merely of the existence of any vacancy in or of any defect or
irregularity in the constitution of such Board, Committee or Sub-Committee.
Therefore, the alleged defect in the composition of the committee, by taking into account particular areas of operation, cannot be accepted.
Areas of operation such as Chennai, Vellore and Tirunelveli cannot make any distinction in the matter of fixation of the minimum wage. In fact, both
Tirunelveli and Chennai are having Corporations whereas in the case of Vellore and Vaniyambadi in North Arcot Districts, they are only
municipalities.
In fact, fixation of the minimum wage on the basis of different zones in a particular State was also rejected by this Court in respect of the very
same petitioner in a batch of cases reported in Muruga Home Industries Vs. Government of Tamil Nadu and Another, The relevant passage found
in paras 23 and 24 of the said judgment are as follows:
Para 23: It was also contended by learned Counsel for the petitioner that the principle of zoning was not followed before the minimum wages of the
beedi workers were revised by the first respondent. In this connection, learned Counsel referred to the annexure to the affidavit, in the main writ
petition and pointed out the principle of ""zoning"" has been followed with regard to hotels, cinemas and other industries whereby different wages
have been fixed for industries falling in different areas. Learned Counsel contended that the wages of beedi workers vary in different districts of
Tamil Nadu State and, therefore, the principle of ""zoning"" ought to have been followed by the first respondent in different zones. In this connection,
he pointed out that the representations have been taken into consideration the wages prevailing mainly in the districts of North Arcot, Trichy and
Madurai, where as the factories of the petitioners herein all are located in Tirunelveli, where the wages are not so high and this aspect of the matter
has not been considered ;by the first respondent. On the other hand, the learned Additional Government Pleader submitted that the principles of
zoning"" will not apply to beedi industry. Mr. Chandru appearing for the impleaded parties, submitted that the principle of ""zoning"" will not apply to
the beedi industries and in this connection, he referred to the ruling in Kaley Khan v. State of Uttar Pradesh 1993 2 LLN 787 wherein a Division
Bench of the Allahabad High Court considering the principles of zoning has observed as follows:
In Chandra Bhavan Boarding and Lodging v. State of Mysore (supra), the Supreme Court held thus (at page 411)
The fixation of minimum wages depends on the prevailing economic conditions the cost of living in a place, the nature of the work to be performed
and the conditions in which the work is performed. The contention that it was impermissible for the Government to divide the State into several
zones is opposed to Section 3(3) as well as to the scheme of the Act.
There is force in the contention of learned Counsel for the respondents that the principles of ""zoning"" will not apply to the instant case. In this
connection, a reference may be made to Section 3 of the Act which reads as follows
Fixing of minimum rates of wages - (1) The appropriate Government shall, in the manner thereinafter provided,-
(a) fix the minimum rates of wages payable to employees employed in an employment specified in Part I or Part II of the Schedule and in an
employment added to either part by notification u/s 27:
Provided that the appropriate Government may, in respect of employees employed in an employment specified in Part II of the Schedule, instead
of fixing minimum rates of wages under this clause for the whole State fix such rates for a part of the State, or for any specified class or classes of
such employment in the whole State or part thereof....
Provided that where for any reasons the appropriate Government has not reviewed the minimum rates of wages fixed by it in respect of any
scheduled employment within any interval of five years, nothing contained in this clause shall be deemed to prevent it from reviewing the minimum
rates after the expiry of the said period of five years and revising them, if necessary, and until they are so revised the minimum rates in force
immediately before the expiry of the said period of five years shall continue in force....
(3) in fixing or revising the minimum rates of wages under this Section-
(a) different minimum rates of wages may be fixed for-
(i) different scheduled employments;
(ii)different classes of work in the same scheduled employment;
(iii) adults, adolescents, children and apprentices;
(iv) different localities;
(b) minimum rates of wages may be fixed by any one or more of the following wage periods, namely:
(i) by the hour;
(ii) by the day;
(iii) by the month; or
(iv) by such other large wage period as may be prescribed;
and where such rates are fixed by the day or by the month, the manner of calculating wages for a month or for a day, as the case may be indicated:
provided that where any wage periods have been fixed u/s 4 of the Payment of Wages Act, 1936(4 of 1936), minimum wages shall be fixed in
accordance therewith.
Para 24: It is clear that Section 3 of the Act specified different classification for fixing or revising minimum rates of wages under the Section. In the
instant case, the appropriate Government has chosen in revising minimum rates of wages to beedi workers under category given in Section 3 of the
Act, viz., ""different scheduled employment"" and not Section 3(3)(a)(i) of the Act, there is no force in the contention of learned Counsel for the
petitioner that the principle of ""zoning"" has not been applied by the first respondent before revising the minimum wages of the beedi industry. Thus,
while fixing the minimum wages for the employees, it is not necessary that the criteria of region basis alone should be adhered to as the minimum
wages depend on the prevailing economic conditions, the cost of living in a place, and other factors. I am, therefore, of the opinion that the
impugned notification cannot be said to suffer from infirmity on the ground that the principle of region or zonal has not been applied while fixing
minimum wages for the employees engaged in beedi making industry. Accordingly, I reject the contentions of learned Counsel for the petitioners.
A perusal of the original file clearly shows that the report of the Advisory Committee signed by all the representatives before the chairman of
the Advisory Committee (Deputy Commissioner of Labour), Tirunelveli and it was dated 29.8.2002. It was the finding of the Advisory Committee
that in the Ring Labelling mostly women are employed and therefore, fixation of minimum wage was done. It was observed that for every day for a
period of 8 hours, 8000 to 10000 beedies ring label can be affixed. If rates are not fixed, the workers will suffer.
In fact, the committee recorded the statement of one member, who had stated that for affixing ring label for 1000 beedies, Rs. 4.50 was paid
in many industries in the Southern District themselves. This fact was confirmed during committee''s visit to Tirunelveli. The employers''
representative, A. Mohammed Shariff told the committee that in an another place Rs. 3.00 was given for pasting ring labels and they are having
negotiations with the Union. In some place, a settlement was reached with an agreement to pay to Rs. 4.00 per thousand beedies.
In view of this, the Committee unanimously agreed that only some managements were continued and in the light of the findings recorded, the
committee recommended Rs. 5.00/- for pasting ring label for 1000 beedies and the management should supply both the gum and the thread for
doing the same. Not stopping with the same, the committee also expressed pasting of ring label of 10,000 beedies per day. However, the trade
union should be aggrieved paid on this issue. It is not as if the committee did not have any material. The members of the committee had
recommended a separate payment for ring labelling. The representation allegedly given by South Tamil Nadu Beedi Manufacturers Association to
the Committee to affix ring label is a different story. Obviously, it did not find favour with the committee.
In fact, it is seen from the original notification in the schedule contained an entry that it relates to beedi making other than beedi rolling. This
notification comprehensively includes ring labelling and other types of labelling.
An affidavit was filed on behalf of the impleaded respondents in W.P.(MD) No. 5663 of 2005 denying the allegations made by the
management. It is stated that the mention of G.O. on the date of report of the committee as on 30.9.1999 was only clerical mistake and the report
of the committee was dated 29.8.2005. No importance can be given on the mistake found in the Government Order.
An objection was raised that none of the beneficiaries of the minimum wages notification were made parties to the Writ Petition and on the
ground of non-joinder of parties, the Writ Petition is liable to be rejected.
In this context, the learned Counsel relied on the judgment of this Court in Muruga Home Industries Vs. Government of Tamil Nadu and
Another, . In the said judgment similar objections raised by the workman in paragraph 2, which is as follows:
Section 2. Learned Counsel for the respective writ petitioners submitted their contentions, on the interpretation of Section 5(1)(b) and Sub-section
(2) of Section 5 of the Minimum Wages Act, 1948 (hereinafter referred to as ""the Act""). On the other hand, Mr.K.Chandru, learned Counsel for
the impleaded parties in writ petitions Nos. 7923 and 7925 of 1993 had raised preliminary objections regarding the maintainability of the writ
petitions on the ground that the respective workers or their unions have not been impleaded as parties to the proceedings. In all other writ petitions,
there is no representation on behalf of the employees or their unions from the respective beedi industries and, therefore, he submitted that the writ
petitions ought to be dismissed as not maintainable by this Court on the preliminary ground itself.
In paragraph 29, the said objection was sustained by the Court, this reads as follows:
With regard to preliminary objections taken by the respondents that the petitioners have not impleaded the necessary parties and therefore, the
writ petitions are liable to be dismissed in limine, there is force in the said contention in view of the Supreme Court ruling in Prabhodh Verma v.
State of Uttar Pradesh (supra) referred to above, and the judgment o the Division Bench of this Court in T.R. Sukumaran v. State of Tamil Nadu
(supra). The ruling cited by learned Counsel for the petitioner in State of H.P. v. Kailash Chand Maharajan (Surpa), is not applicable to the facts
and circumstances of the case. On this ground also, the writ petitions are liable to be dismissed. However, since the writ petitions have been
decided on the merits, the other writ petitions are also accordingly dismissed.
In the light of the above, all the writ petitions are liable to be rejected. Since elaborate arguments were advanced and the petitioner
managements have been consistently challenging one notification or the other all these years, this Court undertook to go into merits of the
contentions.
In respect of the workers at Chennai and Vellore, a settlement u/s 12(3) dated 25.6.2002 was entered into before the Deputy Commissioner
of Labour and it has been implemented in other areas also whereas the workers in the Southern Districts were not getting the entire benefit of the
minimum wage notification. Only fair wages are paid to them by the writ petitioners.
It was alleged by the respondents that the activities of labelling and ring labelling is found in the notification and activities relating to beedi
making other than beedi rolling. When the committee itself unanimously accepted a separate payment for ring labelling, it is not open to the
petitioners to challenge the notification on the ground that the procedure contemplated under the Minimum Wages Act was not followed.
Appointments of committee are only made in terms of Section 5 A and only the Government is able to consider the report of the committee
and they are not bound by the report of the committee.
In the present case, by the impugned order, the Government had agreed with the report of the committee apart from fixation of wages, also not
recommended minimum norms of 10,000 labelling per month as it is not humanely possible. Even as per the committee''s report, beedi workers
can even label only around 8000 beedis per day. The committee had taken into account the interest of all concerned and had fixed the minimum
wage for ring labelling. It is not as if the said activity is not found in the very industry itself.
On the contrary, the committee''s finding is that such payments are prevailing in the Beedi Industry and payments varied from place to place.
The committee took note of such payments and had come to the conclusion that as thousands of women are employed in the Southern Districts
and it was necessary that this work requires special attention, the minimum wages are separately fixed. The contentions raised by the employers in
this regard are unsustainable and devoid of merits and contrary to the materials available on record.
In view of the above, all the Writ Petitions will stand dismissed. Parties will be allowed to bear their own costs. Connected Miscellaneous
Petitions are closed.