HC quashes state’s decision to regulate employee recruitment

Kolkata: The Calcutta High Court recently quashed the state government’s decision to form committees for regulation and supervision of the recruitment of contractual and permanent employees in industrial establishments.

The bench of Justice Ravi Krishan Kapur found that the state was trying to arbitrarily regulate employment in violation of the legislative mandate under the Industrial Disputes Act (ID Act). The court called the decision unnecessary, unreasonable, excessive and without any rational basis.

In 2022 the state’s Labour department had issued a notification for various industrial areas mandating that recruitments in industrial/commercial establishments take place only with the knowledge of the committees headed by District Magistrates. The notification also stated the following: “It has been observed that engagement of employees is being made in different industrial establishments without apprising the state government and several anomalies have been reported in this regard. Moreover, charter of demands are being raised from time to time by different trade unions and sometimes settlements are arrived at, keeping the state government in the dark.”

This notification was challenged by a contract workers’ union which argued that the decision was an indirect attempt to bypass an existing statutory mechanism.

The court opined that the involvement of state officials for settling every industrial dispute is unnecessary and a waste of administrative machinery and resources. The court observed that the state was aiming at indirect control of employment in private trade and industry.