The Madras high court has set aside an order of the labour court that directed the Chennai Petroleum Corporation Limited (CPCL), previously known as Madras Refineries Limited (MRL), to absorb the members of a trade union, numbering 381 workers, into the service of CPCL with retrospective effect from the date of their initial entry into the service of MRL Industrial Co-operative Service Society Limited (INDCO Serve) with resultant back wages and attendant benefits.
The CPCL, a public sector company engaged in refining crude oil and manufacture of all petroleum products, also engages contractors for doing various works, said the petitioner.
One such contractor was INDCO Serve, which was formed by workers to avoid exploitation by contractors. Subsequently, its members raised an industrial dispute to absorb them in CPCL and this was referred to the Central Government Industrial Tribunal (CGIT), which held that the so-called contract between INDCO Serve and the CPCL was only sham.
Justice K. Chandru said the INDCO Serve was a registered contractor and the CPCL has registered itself as principal employer under the provisions of the Contract Labour (Regulation and Abolition) Act.
Workmen employed in INDCO Serve were governed by their own standing orders and the special bye-laws applicable to them. The employees of INDCO Serve were not appointed by CPCL but were appointed by INDCO Serve. Thus the contract cannot be said to be repugnant either under the provisions of the Industrial Disputes Act or Contract Labour (Regulation and Abolition) Act.