Crompton Greaves Ltd v Its Workmen (1978)

This is the short, clean authority on wages for the strike period. It states the test in a single sentence that can be reproduced verbatim in an answer, applies it in two steps, and decides the case on burden of proof.

The proposition to carry away is that a striking workman is not automatically entitled to wages and is not automatically disentitled either. Entitlement turns on two conditions together — the strike must be legal and it must be justified — and on a third, disqualifying condition: force or violence during the strike takes the wages away even from a strike that satisfies the first two. And the burden of proving force or violence lies on the employer who asserts it.

Read it alongside the cases on deduction of wages, because it answers a different question. Crompton Greaves asks whether the striking workman can claim wages for days he did not work. The deduction cases ask whether the employer may deduct for hours not worked. The first is an industrial adjudication question; the second is a contractual one.

The appellant, M/s Crompton Greaves Ltd, Calcutta, was an engineering concern manufacturing and selling electrical products — motor-fans, motor control gears, transformers and other electrical instruments — with its registered office at Bombay and branches at several places in India.

On 27 December 1967 the Company intimated to the workmen's Union at Calcutta its decision to reduce the strength of the workmen at its Calcutta branch, on the ground of a severe recession in business. The workmen then numbered 353.

Apprehending mass retrenchment, the Union sought the intervention of the Minister in charge of Labour and of the Labour Commissioner. The Assistant Labour Commissioner arranged joint conferences in his office between representatives of the Union and of the Company to explore avenues for conciliation and amicable settlement. Two conferences were held, on 5 and 9 January 1968, in which both parties participated. As a result, the Company agreed to hold a bipartite talk with the Union at its Calcutta office on the morning of 10 January 1968 to find out the possibility of an agreed solution.

That talk took place, but no agreement could be arrived at. The two sides gave opposite accounts of why. The Union's case was that the management was not serious about a negotiated settlement and merely made a show of discussing the matter. The Company's case was that the attitude adopted by the Union during the talk led it to believe that the Union was not interested in any fruitful negotiation.

The Assistant Labour Commissioner nonetheless continued to use his good offices, and another joint conference was scheduled for 12 January 1968.

Then came the act that decided the case. On the afternoon of 10 January 1968 — that is, between the failed bipartite talk and the conference fixed for two days later — the Company, without informing the Labour Commissioner that it was proceeding to implement its proposed scheme of retrenchment, put up a notice retrenching 93 of its workmen at the Calcutta office.

Treating this as serious and as demanding urgent attention and immediate action, the workmen struck work with effect from 11 January 1968, after giving notice to the Company and to the Labour Directorate, and continued the strike up to 26 June 1968.

Meanwhile the dispute over the justification of the retrenchment was referred by the State Government to the Industrial Tribunal on 1 March 1968. By a later order dated 13 December 1968 the State Government referred to the Tribunal the separate issue of the workmen's entitlement to wages for the strike period from 11 January 1968 to 26 June 1968.

By its award dated 30 December 1970, the Eighth Industrial Tribunal, West Bengal, split the strike period.

It allowed the workmen's demand for wages for the period from 11 January 1968 to the end of February 1968. It rejected the demand for the remaining period, observing that once the Union had itself sought redress for the retrenchment through the Tribunal, there remained no justification for the workmen to continue the strike. The Tribunal directed payment within one month of publication of the award in the Calcutta Gazette.

The Company appealed by special leave. The workmen did not carry the rejected part further, so the scope of the appeal was confined to the short question of the entitlement of the striking workmen to wages for the period 11 January 1968 to 29 February 1968.

Before formulating the points for consideration the Court set out the law in a compact passage which is the most quotable thing in the judgment:

"It is well settled that in order to entitle the workmen to wages for the period of strike, the strike should be legal as well as justified. A strike is legal if it does not violate any provision of the statutes. Again, a strike cannot be said to be unjustified unless the reasons for it are entirely perverse or unreasonable. Whether a particular strike was justified or not is a question of facts which has to be judged in the light of the facts and circumstances of each case. It is also well settled that the use of force or violence or acts of sabotage resorted to by the workmen during a strike disentitles them to wages for the strike period."

Four separate propositions are packed into that passage, and they should be separated in an answer:

1. Both conditions must be satisfied — legality and justification. One without the other will not do.
2. Legality is a question of statute. A strike is legal if it does not violate any provision of the statutes; it is for the party asserting illegality to point to the provision violated.
3. Justification is generously judged. A strike is not unjustified unless the reasons for it are entirely perverse or unreasonable. The threshold is set against the employer: the enquiry is not whether the strike was wise, or proportionate, or the best available course, but whether the reasons were entirely perverse or unreasonable.
4. Justification is a question of fact, to be judged on the facts and circumstances of each case — which is why the appellate court will not readily disturb the Tribunal's finding.

To these the Court added the disqualification: force, violence or sabotage during the strike disentitles the workmen to wages, whatever the position on legality and justification.

On the basis of those principles the Court framed exactly two points:

1. Whether the strike was illegal or unjustified.
2. Whether the workmen resorted to force or violence during the portion of the strike period from 11 January 1968 to 29 February 1968.

The appeal was dismissed, without any order as to costs. The workmen were held entitled to wages for the period from 11 January 1968 to the end of February 1968.

On the first point — the strike was neither illegal nor unjustified.

On legality, the Court recorded that no specific provision of law had been brought to its notice on behalf of the Company which rendered the strike illegal during the period under consideration. That is the whole of the reasoning, and it is instructive: illegality is not presumed from the fact of a strike; the employer must identify the provision breached.

On justification, the Court pointed to the conduct of the Company. The strike could not be said to be unjustified because, before the conclusion of the conciliation talks that were going on through the instrumentality of the Assistant Labour Commissioner, the Company retrenched as many as 93 workmen without even intimating to the Labour Commissioner that it was carrying out its proposed plan of retrenchment. Point one was therefore answered in the negative.

On the second point — force and violence were not proved.

The Tribunal had held that it was not proved that the workmen resorted to force and violence during the period in question. The Supreme Court said it had itself gone through the entire evidence adduced in the case and had not been able to discern anything which might impel it to take a different view.

The sentence that fixes the burden is this: force and violence may have been resorted to by the striking workmen, but "the vital question that confronts us is whether the Company has been able to establish it."

The Court then listed what was missing. No clear, cogent and disinterested evidence had been adduced to substantiate the charges that the striking workmen had gheraoed the managerial staff, or assaulted and intimidated the loyal employees, or cut off electric lines, or prevented any dealer from entering the Company's business premises and transacting business with it. No prosecution appeared to have been launched in regard to any of these alleged incidents, excepting one which was later withdrawn. The Company had failed to produce the employees named in its own letters to the police. The material on the record thus fell far short of the standard of proof required in cases of this nature.

The Tribunal was therefore justified in holding that the management had failed to prove force and violence, and the Court would not interfere with a finding of fact of that kind in an appeal under Art. 136.

Workmen are entitled to wages for the period of a strike only where the strike is both legal and justified; a strike is legal unless it violates a statutory provision, and it is not unjustified unless the reasons for it are entirely perverse or unreasonable. Even a legal and justified strike carries no wages if the workmen resort to force, violence or sabotage — but that is an allegation which the employer must establish by clear, cogent and disinterested evidence, and a failure of proof leaves the workmen's entitlement intact.

The structure of the decision is worth noticing because it is the structure of the answer.

The first move is to make justification depend on the conduct of both sides, not of the workmen alone. The workmen struck without waiting; but the employer had implemented a retrenchment of ninety-three men in the middle of a conciliation process it had itself joined, on the very afternoon of a failed bipartite talk, two days before a conference already fixed, and without telling the conciliation authority. Once those facts are stated, the reasons for the strike cannot be called entirely perverse or unreasonable. Justification is judged in context, and the context includes what provoked the strike.

The second move is to keep legality and justification distinct. They are commonly run together in answers, and they are not the same enquiry. Legality is measured against the statute book alone. Justification is measured against the reasonableness of the workmen's reasons. A strike may be perfectly legal and yet unjustified, or justified and yet illegal; wages follow only where it is both.

The third move is the allocation of the burden on violence. The Court did not find that there had been no violence; it found that the Company had not proved any. That distinction matters in practice, because allegations of gherao, intimidation of loyal employees and interference with dealers are almost invariably made when a long strike is litigated. The judgment tells the adjudicator what to look for — disinterested witnesses, prosecutions actually launched, the named persons actually produced — and tells him what to do when they are absent.

The fourth point is implicit in the Tribunal's split award, which the Supreme Court left undisturbed: justification can run out. The Tribunal held the strike justified up to the end of February and unjustified thereafter, because once the Union had itself invoked adjudication for the retrenchment, continuing the strike had no justification. Only the first part was before the Supreme Court, so the second was not decided; but the proposition that justification is to be judged over the life of a strike, and may cease part-way, is one the award illustrates and the Court did not disapprove.