SC allows SpiceJet to seek modification in Bombay HC order on re-hiring employees
The airline had argued in the high court that it was not a case of termination of services as the employees were on fixed-term contracts and after the expiry of their term, it was not renewed
The Supreme Court has allowed SpiceJet to approach the Bombay high court to seek modification in the high court order asking to re-hire employees whose service contracts had expired or allegedly terminated post-Covid-19 pandemic on December 31, 2021.
The top court asked the domestic low-cost carrier to cite its “reduced flight operations” (down to just 165 daily flights) as a ground to seek a modification and noted that the documents relating to the period of service of the employees and the reduction in number of flight operations, be brought to the notice of the high court.
In an order passed last week, a bench of justices JK Maheshwari and KV Viswanathan noted that at the time when the high court order was passed in May this year, the private airline operated 242 daily flights with 44 flights operating each day from Mumbai.
Senior advocate CU Singh, appearing for SpiceJet along with advocate Nupur Kumar, pointed out that since then, there has been further downsizing in the company, and the daily flights have been reduced to just 165, with only 11 flights operating from Mumbai.
The bench, after going through the May 3 order of the Bombay high court, found that this fact was not considered in the entire judgment allowing SpiceJet to withdraw its appeal and approach the high court. “At the first instance, it is imperative on the petitioners to bring all those documents to the notice of the high court and seek modification of the order impugned,” the Supreme Court said.
“It is made clear that in case any adverse order is passed by the high court, the petitioners shall be at liberty to approach this Court afresh,” held the court.
SpiceJet had approached the Bombay high court challenging an order passed on January 10, 2022, by the Central Government Industrial Tribunal-2 (CGIT-2) in Mumbai. The tribunal had directed the airline to provide employment to 462 former employees by renewing their service contracts that ended in December 2021. These employees were jointly represented under the banner All India Spice Jet staff and employees association.
The high court further modified the tribunal order and held that 371 employees, who have not yet resigned, will get to exercise the option whether they wish to continue with SpiceJet. The court directed SpiceJet to either provide them employment and pay wages along with all accompanying benefits or furnish a bank guarantee of the same amount.
Before the top court, the airliner produced a chart to show that the position of the company had drastically declined since 2022 when the high court decided the matter and in August this year when the appeal was filed before the top court.
The chart showed that the total number of aircraft was reduced from 46 to 32 of which three were on lease. Flights now operate in only 47 cities and four countries. Before the COVID-19 pandemic, SpiceJet operated 522 flights daily and post-pandemic, it halved to 245 in 2021, further falling to 242 last year.
The petition filed by the airliner stated, “In the present circumstances, the company does not have operations or work justifying the employment of such number of employees due to huge reduction in its operations. If such an order is allowed to sustain, the company will buckle under financial pressure.”
The reduced flight operations also impacted the manpower requirements and its allocation at Mumbai airport. “It is therefore not economically viable for the petitioner company to continue to give employment or wages to surplus employees,” it further stated in its plea.
It was also pointed out that a sweeping order was passed by the high court for all 371 employees without noticing the fact about 120 of them had resigned and the order resulted in uniformly treating employees with four years of service at par with those who completed 10 years.
By its order, the high court created a new contract of employment contrary to the fixed-term contracts under which they were employed. The airline had argued in the high court that it was not a case of termination of services as the employees were on fixed-term contracts and after the expiry of their term, it was not renewed.
However, the airline employees stated that unless there is evidence to show any misconduct against the employees, under the Industrial Disputes Act, the company is bound to provide employment to all employees.