In U.P. State Brassware Corporation Ltd. v. Uday Narain Pandey ((2006) 1 SCC 479), the Supreme Court examined the application of Section 25G of the Industrial Disputes Act, 1947, which embodies which principle?
- A
That retrenchment must always be carried out based purely on the employee's performance ratings, with no reference to seniority
- B
Section 25G embodies the 'last come, first go' principle, requiring that, in the absence of any agreement between the employer and the workman to the contrary, the employer shall ordinarily retrench the workman who was the last person to be employed in that particular category, unless reasons are recorded for departing from this seniority-based principle
- C
That retrenchment decisions can never be challenged before any Labour Court or Industrial Tribunal
- D
That seniority has no relevance whatsoever to retrenchment decisions under the Industrial Disputes Act
View answer and explanation
Correct answer: B. Section 25G embodies the 'last come, first go' principle, requiring that, in the absence of any agreement between the employer and the workman to the contrary, the employer shall ordinarily retrench the workman who was the last person to be employed in that particular category, unless reasons are recorded for departing from this seniority-based principle
In U.P. State Brassware Corporation Ltd. v. Uday Narain Pandey (2006) 1 SCC 479, the Supreme Court examined Section 25G of the Industrial Disputes Act, 1947, which codifies the 'last come, first go' principle in the context of retrenchment. Under this provision, in the absence of a contrary agreement, an employer must ordinarily retrench the workman within a particular category of employees who was employed last (i.e., has the least seniority), departing from this principle only for recorded reasons, which the employer must be prepared to justify. This principle aims to ensure fairness and prevent arbitrary selection of employees for retrenchment, protecting senior employees from being unfairly targeted ahead of more recently hired workers within the same category.
Source note: Section 25G, Industrial Disputes Act 1947; U.P. State Brassware Corporation Ltd. v. Uday Narain Pandey (2006) 1 SCC 479