Bank of Baroda Amalgamation – Dispute Regarding Bonus Eligibility

29. It appears from the evidence of Shri Dinendra Nath Biswas, Ex.11/W that Hind Bank Limited amalgamated with the Bank of Baroda Limited in 1958 August. In connection with the amalgamation there was a Scheme of Amalgamation, between the Bank of Baroda Limited and the Hind Bank Limited (Ex.10/ W). Clause 11 of the Scheme of Amalgamation given in Ex.10/W is as follows:-
    “11. Upon the amalgamation taking effect, the Transferee shall be deemed to have appointed and taken over all the employees of the Transferor as employees of the Transferee and
    (a) the service of all the said employees shall not be interrupted by such transfer,
    (b) the terms and conditions of service applicable to such employees after such transfer shall not in any way be less favourable to them then those applicable to them immediately before the transfer.
    (c) the Transferee shall be liable to pay to such employees in the event of retrenchment of any of them compensation payable in accordance with law on the basis that his service has been continuous and has not been interrupted by the transfer.
    The transferred employees shall be subject to the discipline and service rules of the Transferee.”
30. In order to understand the expression “Transferee and “Transferee” it is necessary to refer to clause 1 of Ex.10/W. It is as follows:-
    “1. The Hind Bank Limited is hereinafter referred to as ‘the Transferor’. The Bank of Baroda Limited is hereinafter referred to as the Transferee’.”
31. In view of Clause 11(a) and (b) referred to above it is clear that account of amalgamation of Hind Bank Limited with the Bank of Baroda Limited there was not to be any break in service of Hind Bank employees and that they were to be given continuity of service,
32. As per clause 6 of the Circular dated 22-111968 in connection with diamond Jubilee Bonus for calculating completed years of service, continuous service actually put in as on 20-7-1968, in the Bank of Baroda Limited alone was to be considered and service in any other Bank prior to amalgamation with the Bank of Baroda Limited as not to be considered. This particular clause is inconsistent with the Scheme of Amalgamation clause 11(a) and (b) (Ex.10/W). Hence the dispute between the parties is whether the Bank of Baroda is justified in making this distinction between workmen and workmen. The dispute referred to me is this. This dispute is clearly an industrial dispute within the meaning of Section 2(k) of the Industrial Disputes Act, 1947.
33. It is contended on behalf of the employees that the dispute regarding ex-gratia Diamond Jubilee Bonus is not connected with the employment or nonemployment or the terms of employment or with the conditions of labour of the employees and that on account of this the present dispute is not an industrial dispute within the meaning of Section 2(k) of the I.D. Act, 1947.
34. In the amalgamation Scheme Ex.10/W there is no term or condition which compels the employers to give bonus to the employees.
35. The employers have produced two forms Ex.8/E and 9 / E. There is no term or condition of service in any of the forms of the employees of the Bank of Baroda, under which the Bank of Baroda was under obligation to pay any bonus to the employees. Hence
    the dispute regrading bonus cannot be said to be connected with the terms and conditions of service of the employees.
36. Section 22 of the Payment of Bonus Act, 1965 lays down that where any dispute arises between an employer and his employees with respect to the bonus payable under this Act, or with respect to the application of the Act to an establishment of public sector, then such dispute shall be deemed to be an industrial dispute within the meaning of Industrial Disputes Act, 1947.
37. It means that even though the dispute relating to bonus cannot be an industrial dispute within the meaning of Section 2(k) of the I.D. Act, it will be an industrial dispute under Section 22 of the Payment of Bonus Act, 1965 provided the bonus is payable under the Act.
38. In the present case the bonus was given in connection of Diamond Jubilee. It could not be therefore a bonus under Payment of Bonus Act, 1965
39. Section 10(1) (d) of the Industrial Disputes Act, 1947 is as follows:-
    “10(1)-Where the appropriate Government is of opinion that any industrial dispute exists or is apprehended, it may at any time, by order in writing-
    (d) refer the dispute or any matter appearing to be connected with or relevant to, the dispute, whether it relates to any matter specified in the Second Schedule or the Third Schedule to a Tribunal for adjudication.”
40. In view of the above provision it is clear that if there is adispute between the parties relating to a matter specified in Third Schedule, the same can be referred to an Industrial Tribunal by the appropriate Government.
41. Item No. 5 in the Third Schedule of the Industrial Disputes Act, 1947 relates to bonus, profit sharing, provident fund and gratuity.
42. As item No. 5 in the Third Schedule relates to Bonus and as the dispute relating to this item in the Third Schedule can be referred to an industrial Tribunal by the Government under Section 10(1) (d) of the I.D.Act, the same is an industrial dispute under the provisions of Industrial Disputes Act, 1947.
43. In the present case the criculay describes the bonus an ex-gratia bonus. In my opinion the expression bonus includes the ex-gratia bonus also. If the intention of the legislation would have been to exclude the ex-gratia bonus from the provisions of the I.D. Act, they would have specifically mentioned in the Third Schedule item No. 5 on “bonus, which is not ex-gratia bonus”. In my opinion the dispute about any kind of bonus can be referred to an Industrial Tribunal by the Central Government under Section 10(1) (d) of the I.D. Act, 1947.
44. It is contended on behalf of the Bank that exgratia bonus is a prize or gift, that it is in the dicerction of the management whether to give it or not and to whom it should be given and that there can be no reference in respect of a dispute regarding prize or gift.
45. In the first place the Bank relies on the case of Managman Mills Co. Ltd., Ahmedabad Vs. Mohamed Sali Bakruddin and 11 others reported in 1953, Labour Appeal Cases Page 58 to show that it is entirely at
    the discretion of the Manager to give prize or Inam. This case lays down as follows:-
    “An employer give prizes in money or in kind to workmen as an incentive to production, entirely at the discretion of the Manager, there being no fixed scheme or rule (HLL)-that such payments cannot be regarded as a usage or practice and no question of legal change can raise upon discontinuance.
    Even if such payment were to be regarded as regards coming within the definition of wages in section 3(39) of the Bombay Industrial Relations Act, 1946, a claim for it must be made within the period of limitation,
    The period of limitation runs from the date of discontinuance of the payments and there is no recurring cause of action at the end of every month.”
46. The Bank relies on another case of United Commercial Bank Ltd. Vs. Mr. A. C. Kakur, Clerk, the United Commercial Bank Limited, Bellanganj, Agra and the U.P. Bank Employee’s Union, Maithan, Agra reported in 1964, Labour Appeal Cases, Page 496. This case lays down as follows:-
    “STRIKE-being admittedly illegal-workmen could not be entailed-to any wages-for the period of strike.
    Ex-gratia payment-It is open to employer to make such payment-for the period of illegal strike-although workmen have no right to claim it.
    Discrimination-one set of workmen resorted to strike being misled by leaders-other set, did it deliberately-the employers conduct in showing leniency to one set and declining to on so to the other-cannot be condemned as discrimination.
    The strike was admittedly illegal as certain proceedings were pending before Industrial Tribunal, so the workmen who had gone on strike are not entitled to payment of any wages for the period of strike.
    It is always open to the employer to make payment ex-gratia to his workmen for the period of illegal strike even if the workmen may have no right to claim it.
    One set of employees have gone on strike being misled by its leaders while the other set being a leader himself was under no such handicap. In other words his conduct in resorting to strike was deliberate, with full knowledge of the consequences. In such circumstances the employers conduct in showing leniency to one set of workers and declining to do so in case of another cannot be condemned as amounting to discrimination.”
47. The facts of the above two cases are not applicable to the facts of the case which I ma deciding. In the present case the Bank is not giving any prize or reward to its employees, but it is giving ex-gratia bonus.
48. The word bonus has been defined as ex-gratia payment to workmen or others in the Chambers’ Twentieth Century Dictionary.
49. The definition of bonus given in Oxford Iltuc. troted Dictionary in gratuity to employees beyond their wages.
50. If we consider the dictionary meaning of the word bonus referred to above it will be clear that the two rulings relied upon by the Bank would not apply to the present case.
51. Any bonus is not included within the definition of wages given in Section 3(rr) of the I.D. Act, 1947. Similarly ex-gratia payment or any bonus is not in. cluded within the definition of salary or wage given in Section 2(21) of the Payment of Bonus Act, 1965 It is therefore contended that a dispute relating to ex-gratia payment or bonus would not be an industrial dispute and on account of this, this reference is had in law. This contention cannot be accepted because a dispute relating to any bonus is an industrial dispute under the provisions of Section 10(1) (d) read with Third Schedule Item 5.
52. In short it will be clear from the above discussion that there is no sustance in the preliminary ob”tion raised by the Bank in their written statement Ex.2/K para 1. I negative the Bank’s contention and hold that this Tribunal has jurisdiction to entertain this reference and that the same is valid and tunable in law. Hence my finding on point Nos. i and ii are as above.

Point No. iii and iv

49. It is common ground that while giving ex-gratia Diamond Jubilee Bonus it was to be given on terms and conditions mentioned in the Circular dated 22-11. 1965 referred to above in para. 9, Clause 6 of this circular clearly mentions that for calculating completed years of service as on 20th July, 1965 continuolis service actually put in the Bank of Baroda Limited will alone be considered and service in any other Bank prior to amalgamation with the Bank of Baroda Limited will not be counted. This clause clearly makes distinction between orgiinal employees of the Bank of Baroda and the employees of amalgamated banks, viz. (i) Hind Bank Limited, (ii) New Citizen Bank, (iii) and Tamilnad Central Bank Limited. The Bank is not prepared to give Diamond Jubilee bonus to the employees of amalgamated banks for their service before the amalgamation. The bank is giving them bonus only for the period of their service actually put in the Bank of Baroda i.e. for their service after amalgamation. This means that they are making distinction between workmen and workmen while giving Diamond Jubilee bonus.
50. The Bank contends that the services of the persons who gave service to the Bank of Baroda for those years and those who have not given service to the Bank of Baroda were distinguished because each year of service with the Bank of Baroda brought prosperity to the Bank of Baroda and because the employees who did not serve the Bank of Baroda had not contributed to the prosperity of the Bank of Baroda. It is therefore contended that this distinction between the workmen and workmen does not amount for discrimination. I am unable to accept this contention.
51. If such distinction is allowed to be made, it will create diserttufaction among the employees disturbing the industrial peace and tranquility. In the interest of social justice, for maintaining peace and tranquility and soed employer-employee relationship. It is necessary that such distinction between workmen and workmen in the same establishment should not be allowed to be made. In my opinion such distinction amounts to discrimination which creates heart burning and dissatisfaction among the employees.
52. It is contended on behalf of the Association that when Golden Jubilee Bonus was given there was no discrimination but the same was made when the Diamond Jubilee Bonus was given.
53. The Circular regarding Golden Jubilee Bonus Ex.22/W is as follows:-
    “THE NAME OF BARODA LTD. BARODA/INDIA
    Circular letter No. 241 of 1958 24th Dec. 1958
    The Manacor/Anent
    All Branche:
    The Bank of Baroda Ltd..
    Dear Sir,

Re: Golden Jubilee Bonus

We have to inform you that our Board of Directors have been pleased to sanction payment of an ex-gratia Golden Jubilate Bonus to the members of staff equal to one month’s basic salary to commemorate the Golden Jubilee of the Bank. The payment should be made on 3rd January, 1958, on the basis of the salary in December, 1958, to the debit of our account. In this connection please note that:

(1) Special allowances are to be included to the salary.

(2) Payment to be made to all those who are on the pay roll on the 20th December, 1958.

(3) Full bonus to be paid to all those on the pay roll on the 20th December, 1958, irrespective of the date of joining the service.

(4) Part-time employees are also to be paid.

(5) Those who were on leave on loss of pay are to be paid full bonus.

(6) The salary for calculating bonus should be the salary that an employee draws in the month of December, 1958. Thus if an employee drawing Rs. 100/- earns an increment of Rs. 6/- on the 16th December, 1958, the bonus to be paid should be Rs. 103/- which he will actually draw for December, 1958, and not Rs. 106/-.

Please send us a statement of the amount paid with the details in respect thereof showing separately the particulars of payment of different categories, etc., officers, clerks, subordinates and part-time employees. The totals of bonus paid to each categories of the staff should be shown separately therein.

Please inform the members of your staff that it is making the payment any mistake occurs in calculations, adjustments will have to be made.

Yours faithfully,

Sd/- Eligible.

Pr. General Manager.

54. This circular lays down that full bonus should be paid to all those on the pay roll on 20th December, 1958 irrespective of the date of joining the service. In view of this clause, it is clear that the Golden Jubilee Bonus was given equally to all members of staff irrespective of their standing and that no discrimination was made between workmen and workmen.

55. The Association contends that the ex-gratia Bonus is not ex-gratia and that even if it was so the Bank cannot deprive one section of its employees without their latches. There is much force in the contention. In the absence of convincing, satisfactory and valid reasons the Bank cannot make distinction between workmen and workmen while making payment of ex-gratia bonus to the staff.

56. The Bank contends that Diamond Jubilee Bonus is a reward for long service given to the Bank and that minimum was paid to all, but more amount was paid to longer service put in the Bank of Baroda Limited and that on account of this distinction between workmen and workmen made in this respect does not amount to discrimination. I am unable to accept this contention.

57. By giving more amount for longer service with the Bank of Baroda Limited only the Bank of Baroda wants to show more favour sympathy and leniency to the original employees of the Bank of Baroda only. In my opinion there is no valid reason for doing so especially when they have agreed to give continuity of service to the ex-Hind Bank Ltd., employees at the time of amalgamation under the amalgamation scheme. As the Bank has agreed to give them continuity of service and to count their previous service before amalgamation for all purposes, they cannot make any distinction between workmen and workmen, working in the same establishment for any purpose.

58. The Bank contends that this dispute has arisen because the Association in question was not consulted before declaring bonus and that this dispute is limited dispute only concerning the ex-Hind Bank Ltd. employees of Calcutta who are members of the Association in question. It is also contended by the Bank that all employees of other amalgamated Bank throughout India accepted the payment on the basis of Circular and that on account of this the Tribunal should not accept this restricted dispute and open further disputes.

59. The Bank’s contention that the present dispute is restricted dispute raised by the Bank of Baroda Ltd., Calcutta staff Association representing the ex-Hind Bank Employees only cannot be accepted. The dispute referred to this Tribunal by the Central Government relates to the employees of New Citizen Bank and Tamilnad Central Bank Limited also. The Calcutta staff Association may not be representing them. Their failure to represent these employees will not make the present dispute restricted.

60. Shri Ajit Shankar Bhattacharyya, who is Agent of the Bank at Calcutta states in his evidence Ex.24/E on merit as follows:

“This ex-gratia payment was accepted by all banks amalgamated with the Bank of Baroda except ex-Hind Bank. Bank of Baroda has not made any discrimination amongst the employees in respect of this payment.

61. He has produced a telex message received from the Bombay Central office in connection with the acceptance of ex-gratia bonus by other amalgamated banks employees. That telex message Ex.25/E is as follows:

“GRAMSON CA-7382
CEDORAB 0113159
0392
1535/7
AGH CALCUTTA

REPTEL OF IND DIAMOND JUBILEE BONUS
STOP WE HAVE ON OUR RECORD NO INFORMATION RE. HOW ACCEPTANCE OF DIAMOND JUBILEE BONUS BY TAMIL NADU P.C. BANK EMPLOYEES STOP OBVIOUSLY THEY HAVE ACCEPTED STOP HOWEVER IF NECESSARY GET IT CONFIRMED FROM HEAD OFFICE—PERSOIDY.”

62. It appears from the telex message Ex.25/E referred to above that the Central Office Bombay has no record to show that the employee of other amalgamated Banks viz., New Citizen Bank and Tamilnad Central Bank Ltd. have refused to accept the Diamond Jubilee Bonus. It further says that obviously they must have accepted and that if necessary it should be confirmed from the Joint Office. The Bank has not produced any confirmation from the Head Office in this respect. The Agent has also no personal knowledge regarding the Diamond Jubilee Bonus except from records. In these circumstances it will be difficult to hold on the statement of the Agent that ex-gratia bonus was accepted by the employees of other amalgamated banks with or without protest.

63. As the amalgamation schemes of New Citizen Bank and the Tamilnad Central Bank Ltd. with the Bank of Baroda are not on record before me, it will not be proper to decide the dispute in respect of the employees of these two banks. Their dispute will
    have to be kept open with liberty to take such legal steps as may be open to them.

64. In short it will be clear from the above discussion that the management of Bank of Baroda was not justified in excluding the period of service rendered by the workmen of ex-Hind Bank Ltd. prior to amalgamation with the Bank of Baroda for the purpose of payment of Diamond Jubilee Bonus declared by the Bank of Baroda in 1968 and that the action of the Bank of Baroda in doing this amounts to discrimination and unfair labour practice. The ex-Hind Bank Ltd. employees are therefore entitled to get ex-gratis Diamond Jubilee Bonus on the basis of their whole length of service before and after amalgamation with the Bank of Baroda. Hence my finding on point Nos. iii and iv are as above.

Point No. vi

65. In view of the above findings I pass the following order.

ORDER

(i) It is hereby declared that the management of Bank of Baroda are not justified in excluding the period of service rendered by the workmen of ex-Hind Bank Ltd. in Hind Bank Ltd. prior to amalgamation with the Bank of Baroda Ltd. for the purpose of payment of Diamond Jubilee Bonus declared by the Bank of Baroda in 1968 and that they are entitled to get Diamond Jubilee Bonus on the basis of their whole length of service before and after amalgamation with the Bank of Baroda Ltd.

(ii) It is hereby declared that the dispute as to whether the management of Bank of Baroda are justified in excluding the period of service rendered by the workmen of the New Citizen Bank and the Tamilnad Central Bank Ltd. under the said Banks for the purpose of payment of Diamond Jubilee Bonus declared by the Bank of Baroda in 1968 is kept open and that the employees of ex-New Citizen Bank and ex-Tamilnad Central Bank Ltd. may take such steps as may be open to them in respect of the present dispute.

(iii) Award is made accordingly.

(iv) No order as to costs.

Sd/- N. K. VANI.

Presiding Officer.

Central Govt. Industrial Tribunal

No. 2, Bombay.

[No. 23/56/69/LRIII].

S. S. SAHASRANAMAN, Under Secy.

MINISTRY OF FOREIGN TRADE

New Delhi, the 1st April 1972

S.O. 946.—Whereas the Central Government, is of opinion that, in exercise of the powers conferred by section 6 of the Export (Quality Control and Inspection) Act, 1963 (22 of 1963), rubber gloves for electrical purposes should be subject to quality control and inspection prior to export;

And whereas the Central Government has formulated the proposals specified below for the said purpose and has forwarded the same to the Export Inspection Council, as required by sub-rule (2) of rule 11 of the Export (quality Control and Inspection) Rules, 1964;

Now, therefore, in pursuance of the said sub-rule, the Central Government hereby publishes the said proposals for the information of the public likely to be affected thereby.

2. Notice is hereby given that any person desiring to forward any objection or suggestion with respect to the said proposals may forward the same within sixty days of the date of publication of this notification to the Export Inspection Council, ‘World Trade Centre’, 14/1B, Ezra Street, (7th floor), Calcutta-1.

Proposal

(1) To notify that rubber gloves for electrical purposes shall be subject to quality control and inspection prior to export;

(2) To specify the type of inspection in accordance with the draft Export of Rubber Gloves for electrical purposes (Inspection) Rules, 1972, set out in the annexure to this notification as the type of inspection which would be applied to such rubber gloves;

(3) To recognise—

(a) the specifications, which shall be a national standard of an importing country, declared by the exporter as the agreed specifications of the export contract for the electrical rubber gloves;

(b) in the absence of any specifications as mentioned in (a), the Specifications approved for rubber gloves for electrical purposes by the Indian Standard Institution, as the standard specifications for rubber gloves for electrical purposes.

(4) To prohibit the export, in the course of international trade of the rubber gloves for electrical purposes unless the same is accompanied by a certificate issued by one of the agencies recognized by the Central Government under section 7 of the Export (Quality Control and Inspection) Act, 1963 (22 of 1963), to the effect that such rubber gloves for electrical purposes are export-worthy.

3. Nothing in this notification shall apply to the export by land, air or sea of samples of such rubber gloves to prospective buyers the f.o.b. value of which does not exceed Rs. 125.

4. In this notification ‘rubber gloves for electrical purposes’ shall mean all types of gloves, made wholly of rubber, used for protection to workers from electrical shocks while working on energized conductors and equipments.

ANNEXURE

Draft rules proposed to be made under section 17 of the Export (Quality Control and Inspection) Act, 1963

1. Short title and commencement—(1) These rules may be called the Export of Rubber Gloves for Electrical Purposes (Inspection) Rules, 1972.

(2) These shall come into force on

2. Definition.—In these rules, “rubber gloves for electrical purposes” shall mean all types of gloves, made wholly of rubber, used for protection to workers from electrical shocks while working on energized conductors and equipments.

3. Basis of inspection.—Inspection of rubber gloves for electrical purposes shall be carried out with a view to seeing that the same conform to the standard specifications recognized by the Central Government under section 6 of the Export (Quality Control and Inspection) Act, 1963 (22 of 1963), and specific requirements of foreign buyers provided such specifications do not fall below the recognized specifications.

4. Procedure of inspection.—(1) An exporter intending to export rubber gloves for electrical purposes shall give intimation in writing of his intention so to do and submit along with such intimation a