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CASE NO.:

Review Petition (civil) 1111-1112 of 2002

Appeal (civil) 3337-3338 of 2002

PETITIONER:

Chairman, State Bank of India and another

RESPONDENT:

Vs.

All Orissa State Bank Officers Association and another

DATE OF JUDGMENT: 31/07/2003

BENCH:

K.G.BALAKRISHNAN & (B.N.SRIKRISHNA.

JUDGMENT:

J U D G M E N T

SRIKRISHNA,J.

These review petitions have been filed by the State Bank of India

which is the unsuccessful Appellant in Civil Appeal Nos. 3337-3338 of

2002.

The circumstances under which the present review petitions arise,

briefly recounted, are as follows:-

The Review Petitioner is a nationalised bank and Respondent No. 1,

All Orissa State Bank Officers Association (hereinafter referred to as

"Respondent association") is stated to be a registered unrecognised union

representing less than 9 percent of the officers in the Orissa Circle, having

membership of only 300 officers of the Petitioner bank in the Orissa circle as

against the total number of about 2900 officers. The association filed a

public interest litigation in the High Court of Orissa, Cuttack claiming parity

with the office bearers of another union known as the State Bank of India

Officers Association, which had been recognised by the management of the

Petitioner bank for the purpose of collective bargaining. The main grievance

put forth by the Respondent association in the said petition was that the

Petitioner bank had adopted a policy of hostile discrimination against them

and was showing undue favour to the other union which claims to represent

the majority of the officers.

By the judgment dated 24.11.98 the writ petition was allowed

directing inter-alia as under: -

"For the foregoing reasons we set aside

Paragraph 2 of the staff circular No. 91 of 1997 if

the same is still in force and direct the opposite

parties to confer such rights on the petitioner-

Association as are available to them under Rule 24

of the Verification Rules.

The Management of the State Bank of India

are also directed to keep in mind the observations

made in this judgment while dealing with its

employees; officers and their Unions, recognised

or unrecognised."

Before the High Court, the Respondent association had relied on a set

of rules known as "The Rules For Verification Of Membership And

Recognition Of Trade Unions Rules, 1994". Particular reference was made

to Rule 24 thereof which confers some rights on unrecognised Unions. It is

not clear from the record as to under what provision of law the aforesaid

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rules have been prescribed. Counsel appearing for the Review Petitioner,

and the Respondent who appeared in person, were unable to throw light on

the statutory efficacy of the said rules. In any event, the High Court had

itself noticed in its judgment that the rules were not binding under any

provision of law, and this fact is not disputed at the bar. Despite holding that

these rules were not binding, the High Court held that the spirit and

principle behind Rule 24 was a salutary one and, therefore, the Petitioner

bank should permit the Respondent association, albeit that it was

unrecognised, to meet and discuss with the employer or a person appointed

by the employer the grievances of individual members relating to his service

conditions. On this reasoning, the High Court issued a Writ of Mandamus to

the Review Petitioner bank directing it to implement the principle, if not the

provisions, of Rule 24(a). This direction was challenged in Civil Appeal

Nos. 3337 - 3338 of 2002. These Civil Appeals were dismissed by a

judgment of this Court dated May 6, 2002. The judgment specifically

records the observation of the High Court that, although Rule 24 of the

Verification Rules itself does not apply, the principle behind the rule can be

extended to any normal, unrecognised Union, even if it is not a union of

workmen. It was also observed in the judgment that rules under the Indian

Trade Unions Act had been framed with a view to avoid arbitrariness, bias

and favouritism in the matter of recognition of trade unions, that procedure

prescribed therein was intended to ascertain which of the trade unions really

commands the support of the majority of the employees and that such a

procedure is intended to enable both the trade union and the employer to

carry on collective bargaining efficaciously so that industrial peace would be

maintained and the work of the establishment could be carried on normally.

The Bench took notice of the possibility of multiple trade unions coming

into existence in the industry and was of the view that, though such non-

recognised unions may not have the right to participate in the process of

collective bargaining with the employer over issues concerning the workmen

in general, they had the right to meet and discuss with the employer or any

person appointed by him issues relating to individual grievances of

employees. Hence, it was observed in the judgment:-

"It follows, therefore, that the

management/employer cannot outrightly refuse to

have discussions with a non-recognised union in

matters relating to service conditions of individual

members and the other matters incidental thereto."

After noticing the judgment of this Court in the Balmer Lawrie

Workers' Union, Bombay & Anr. v. Balmer Lawrie & Co. Ltd. & Ors.

[(1985) 2 SCR 492] this Court went on to observe:

"The judgment of the High Court disposing of the

writ petition and the order disposing of the review

petition filed on behalf of the management make

the position amply clear that the rights and

privileges vested in a non-recognised association

are limited to espousing the grievances of

individual members relating to their service

conditions and representing them in domestic or

departmental enquiries held by the employer and

not proceeding before the conciliation officer,

labour court, industial tribunal or arbitrator. The

High Court has not conceded any right to the non-

recognised union to participate in discussions

relating to general issues concerning all workmen."

The review petitioner has urged two points in support. First, that even

the majority union does not have the right of negotiation or representation

with respect to individual grievances and denial of this right to a union,

which was admittedly a minority union, could hardly be said to be

discriminatory as the High Court seems to have assumed. On the contrary, it

is urged that conferring such a special right on the minority union would

amount to reverse discrimination. Secondly, it is contended that in Common

Law there is no obligation on an employer to confer upon a union the right

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to represent individual employees and unless such a provision is expressly

made by any statute or statutory rules, the employer is not obliged to grant

any such right. The High Court has found that the 1994 Verification Rules

do not apply. In any event, the State Bank as a public sector bank had

created its own efficacious grievance settlement machinery and there was no

justification for the High Court to import the principle, if any, from Rule 24

of inapplicable rules to override the grievance redressal machinery which

was already in place. The petitioner contends that these submissions have

been lost sight of in the judgment, which is sought to be reviewed. Hence,

the review petition.

A reference to the counter affidavit in the Civil Appeals filed by the

General Secretary of State Bank of India Officers Association brings home

the fact that, as a matter of long practice and usage, bipartite relations had

been maintained only with the majority/recognised associations, but issues

relating to individual grievances had to be processed through the grievance

redressal procedure as they were not discussed with the majority/recognised

associations. The said affidavit places on record the grievance procedure

with regard to redressal of individual grievances. A perusal of the said

grievance procedure (Annexure A2) clearly shows that there is a three-tier

system of dealing with individual grievances. First, an individual grievance

is to be made to an Initial Authority in respect of the department or section

or branch in which the official is working directly. If there is failure to

render satisfaction or give decision within the prescribed time, an appeal

may be made to the Appellate Authority. If no decision is given by the

Appellate Authority, within the prescribed time frame, then the complaint

may be referred to a Grievance Committee consisting of two representatives

of the bank and two representatives of the supervising staff nominated by the

Supervising Staff Association. The decision of the majority of members of

the said committee shall prevail. This grievance procedure brings out the

fact that the privilege of discussing individual grievances of the officers has

not been given even to the trade unions representing the majority of the

officers.

In all proceedings under the grievance procedure, the officer

concerned may appear himself or in addition have his case represented by a

colleague. It is of significance that no union representative as such is

allowed.

The existing grievance procedure has been functioning smoothly for

the last several decades. The rejoinder affidavit filed by the Petitioner bank

also places on record several circulars by which the grievance procedure has

been brought into place. It also indicates the nature of grievances to be

addressed under the grievance procedure, the manner of disposal of

grievances, appeals and consideration of the grievance by the Grievance

Committee. The grievance procedure circulars clearly indicate that any

disciplinary action taken in accordance with the terms and conditions

governing the official service shall not constitute a grievance to be processed

under the said procedure. It is made clear that any action taken against

individuals for disciplinary purposes would not and could not form the

subject matter of an individual grievance to be ventilated under the

grievance procedure machinery. It is also made clear that the union

recognised by the employer, which represents more than 90 percent of the

officers employed in the concerned circle, had also not been conferred this

privilege of representing its members in grievance proceedings. As far as

representation in such proceedings is concerned, it is confined to a co-

employee or co-officer, irrespective of the trade union affiliation of the

delinquent employee/officers.

For the Respondent association, however, it is contended that there is

no law under which the representative character of the majority association

has been determined. It is also contended that there is no statutory provision,

which could decide as to which of the contending trade unions really

represents the concerned employees. In these circumstances, it is urged that

the judgment of the High Court took a reasonable view, namely, that the

non-recognised trade unions should also be accorded the right of

representing individuals and ventilating their grievances by holding

discussions with the employer which is precisely what has been accepted

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and reiterated in the judgment of this court dated May 6, 2002. It is,

therefore, contended that there is no scope whatsoever, much less any need,

to review the judgment.

In our view, the contention urged by the Counsel for the Review

Petitioner has merit and needs acceptance. There is no Common Law right

of a trade union to represent its members, whether for purposes of collective

bargaining or individual grievances of members. This is an inroad made into

the Common Law by special statutes. Either the special statute operates

proprio vigore, or it does not. In the situation before us, it is undisputed that

Rule 24(a) on which the Respondent association and the High Court placed

reliance, has no application. This is accepted even in the judgment under

review. Nonetheless, on general principles of equity, justice and fair play the

judgment under review holds that the minority trade union should also be

afforded an opportunity of ventilating individual grievances of its members.

It appears to us that, in doing so, the attention of this Court was not adverted

to the elaborate grievance procedure machinery which is in existence and the

details of which are placed on record.

Having considered the matter in its entire perspective, we are inclined

to agree with the submissions, of the Review Petitioner. We do not think that

denying such a right of representation to the minority union, when such a

right is not conceded even to the majority union, amounts to discrimination

requiring redressal at the hands of the High Court. It is also not possible for

the High Court to exercise its powers under article 226 to direct an employer

to bring into existence such a system of representation in grievance

procedure. In the absence of arbitrariness or discrimination, in our judgment,

there was no scope at all for interference in exercise of writ jurisdiction. It is

urged by Shri Salve for the Review Petitioner that the application of such a

principle in one zone might create serious repercussions all over, since the

bank has branches throughout the country. We also noticed that the

appropriate government in respect of the State Bank of India is the Central

Government and the rules made by the State Government cannot be enforced

against it. Considering all aspects of the matter, it appears to us that the

review petitions must be allowed, as these crucial issues were not considered

in the judgment under review.

In the result, we allow the review petitions and recall the judgment

dated May 6, 2002. Consequently, the judgment dated May 6, 2002 in Civil

Appeal Nos. 3337-3338/2002 is recalled. Civil Appeal Nos. 3337-3338 of

2002 are allowed and the judgments of the High Court of Orissa, Cuttack

are set aside. The writ petitions from which the said judgments arose are

dismissed.

No costs.