leading case related to newspaper employees

The Majithia Wage Board case as decided by the Supreme Court of India is a is a landmark one for journalists after the Indian Express case of 1958 decided by Five Judge bench. It concerns with lakhs of newspaper workers of the country. Many Contempt Petitions have been filed against the newspaper owners for not implementing the Award. Here is the summary of the case, as prepared by young Advocate Utkarsh Pandey.

The Majithia Wage Board was constituted in the year 2007 by the Government of India for revising the wages and allowances of the journalists of the Print Media. The Central Government is empowered under Section- 9 and Section – 13C of Newspaper Employees and Miscellaneous Provisions Act, 1955 to constitute two Wage Boards one for Woking Journalists and the other for Non-journalists working for newspapers.

There has been six Wage Boards constituted by the union government so far for working journalists and four Wage Boards for non-journalists from the time of the enactment of the Working Journalists Act in 1955. This Wage Board aka Majithia was constituted on 24.05.2008 initially under the Chairmanship of Justice Narayan Kurup, a retired judge of the Madras High Court, but after some time Justice Gurubaksha Rai Majithia replaced him as the new Chairman on his resignation. The prescribed time for submitting the Wage Board Report originally was of three years but due to unavoidable circumstances its term was extended and it submitted the report on 31.12.2010. However, before the Wage Boards recommendations could be notified by the Central Government, the constitutional validity of the Majithia Wage Boards was challenged in the Supreme Court by the ABP Pvt. Ltd. and another in WP(C) No. 246/2011. Later many other newspaper owners also filed Writ Petitions challenging the Working Journalists Act as well as the Constitution of the Wage Board. All petitions were bunched together. The facts presented by the petitioners were as follows:

1. That the Wage Board is violative of Article-14 and 19 of the Constitution as it is infringing the rights of the newspaper employers. The petitioners submitted that there cannot be distinction between the ‘Print Media’ and the ‘Electronic Media’ as there is no provision for the Wage Board in the Electronic Medium, then why Wage Boards should be imposed on print medium?

2. The Wage Boards of other industries have been abolished over a period time like; Sugar, Tea, Rubber and Cement and the National Commission of Labour (NLC) has also recommended that there is no need to constitute any Wage Board for any industry.

3. Due to socio-economic changes and globalisation and privatisation of the industries there is no need to have any Wage Boards as journalists are fairly paid including the compensation package is given to them.

The petitioners also cursed the Electronic and Digital Medium because of which the newspaper industry is suffering huge loss. The industry has to struggle to sustain. Therefore, the Working Journalists Act has now become obsolete.

Responding those averments respondents i.e. the employees and their unions stated that no Article of the Constitution is violated. Article 14 of the constitution is in the interests of both employers and employees and it is not a one sided matter. The court should, therefore, also look at it from the employees’ side also. The petitioners cannot express the grievance for non-inclusion of Electronic Media because those employees are not present before the court and it will not result invalidation of benefit given to other employees of Press Industry because Electronic Medium is a growing industry unlike Print Medium. And the scope for the potential policies cannot be overruled, therefore, the court rejected the plea of petitioners.

Regarding the second ground that the Act has become obsolete would not result in invalidation of Act and object is upheld in ‘Express Newspaper Pvt. Ltd.’.

The Court also pointed out that with the advent of electronic medium there is a tough competition and challenge to the newspaper industry because the growth of electronic media is very fast. Nevertheless, there is no decline in the growth of print medium. So that is why, there is a necessity to have Wage Boards to protect and promote the working journalists.

Another point which was raised by the petitioners was that the Wage Boards were constituted was improper because the Wage Boards should be comprised ten members from which; one Chairman, three independent members, three representatives of the employers and three representatives of the employees but while different set of representatives for employees for the Common Wage Boards, the employers’ representatives were the same for both Wage Boards. They pointed out the defect in Constitution of Wage Board as two members namely K.M. Sahni and Prasanna Kumar were not independent members.

The petitioners stated that as Mr. K.M. Sahni was a former Secretary of Labour and Employment in the Government of India and during his tenure the decision regarding the constitution of the Wage Boards was taken and as he was under the employment of Government. Therefore, he ceases to be independent member. The court referring ‘State of Andhra Pradesh vs Narayan Vellur Beedi Manufacturing Factory’ that merely because K.M. Sahni was the part of the Government does not automatically follow that he ceases the member of the Wage Boards.

Regarding another person Mr. P.N. Prasanna Kumar petitioners stated that he has been a journalist and also had been actively associated with various journalist organisations in his long journalistic career. Therefore, he cannot be an independent member because of his bias towards employees. The court in this regard quoted two cases.

One ‘Kumaon Mandal Vikas Nigam Ltd. vs Girija Shankar Pant’ in which the word biase was discussed. It was stated that ‘the word biase in a popular English parlance included within the attributes and broader purview of the word malice which in common acceptance means and implies ‘spite’ or ‘ill will’ and it is now well settled that mere general statements will not be sufficient for the purpose of indication of ill will. There must be a cogent evidence available on record to come to the conclusion as to whether in fact there was existing a bias which resulted in miscarriage of justice’.

Second case which was discussed by Supreme Court was ‘State of Punjab vs V.K. Khanna’ and it was held ‘that the test therefore is as to whether there is a mere apprehension of bias or there is a real danger of bias and it is on this point the court said that the surrounding circumstances must and ought to be collated and necessary conclusion drawn therefrom. In the event, however, the conclusion is otherwise that there is existing a real danger of bias, the administrative action be cannot be sustained. On the other hand, allegation pertains to rather fanciful apprehension in the administrative action. Therefore, the question of declaring them to be unsustainable on the bases would not arise’.

So on the basis of these two judgements the Supreme Court stated that the petitioners contention in this regard merely on the past status of any member is baseless and the petitioners have no way to establish that the independent members are guilty of legal bias. The Court further stated that on the perusal of materials available it is satisfied the Wage Boards have functioned in fully balanced manner. The petitioners never challenged the validity of the members and never objected to it when the Committee was in the making. It is only after the period of time the petitioners are now challenging the constitution of committee. They should have objected to it when the names were suggested for the committee.

The petitioners also contended that there should be two separate Wage Boards instead of one common Wage Board. One for the Working Journalists and the other for the Non-journalists. The court in this regard stated that since the 1975 amendment there has been only one common Wage Boards. If two common Wage Boards are created than the members representating employers are common in both the Wage Boards whether for the Working Journalists or Non-journalists and that would create a favourable Wage Boards for the employers as they can make a fair assessment of the requirement of the Working Journalists and Non-journalists. The two Wage Boards have separate entities meant for Working Journalists and Non-journalists. There cannot be common representative who can protect the interest and represent Working Journalists and Non-Journalists. Therefore, members representating Working Journalist are nominated by Working Journalists and Non-journalists representative are nominated by Non-journalists. So for the administrative convenience of four independent members and Chairman are common in both the Wage Boards and in no way it affects the interest of the employer and so the contention of the petitioners is unfounded. The petitioners also challenged the procedure which was followed by Majithia Wage Boards and they stated that there was a irregularity in the decision making process of Majithia Wage Boards. It was prepared in a very hasty manner and the recommendation were accepted by the Central Government without proper hearing or without affording opportunity to all stakeholders.

Union of India in reply to this contention stated that throughout the Wage Boards there was fair procedure and principle of natural justice was followed. It further stated that representatives of the management were not cooperating but were merely attending the Wage Boards’ proceedings and therefore the Chairman was not getting proper aid and help from the newspaper owners. The petitioners also provided that the Wage Boards was not following the procedure which it ought to have followed which was followed in earlier Wage Boards. The court in this regard stated that under section – 11 of the Newspaper Employees and Miscellaneous Provisions Act, 1955 provides that Wage Board has special power to regulate its own procedure and it is not obligatory for the Wage Board to follow the exact procedure of the earlier Wage Boards.

The Supreme Court stated that regarding irregularity which was being asked by the petitioners about the Wage Boards is baseless and reiterated that questionnaire was issued by the Union of India and the respondents also received replies to the same. Several attempts were made by the Wage Boards to get relevant information to get from the employers but many petitioners had not given financial data and they also abstained from attending the Board proceedings. Records were placed and it was clear that the questionnaire was sent to all subscribers listed in the Directory of Newspaper Establishment. Regular follow-up with the employers was made and series of letters was issued to collect financial information.

The petitioners also alleged that only 40 establishments have been used as a parameter for determining the salary. The Court in this regard stated that with all the efforts the financial information of only 66 establishments could be gathered and after the scrutiny it was found that only 40 establishments were useful in developing and overall view of the financial status of the newspaper industry and these 40 establishments are representatives of different classes of newspaper establishments that are carrying business in the country. Thus it can be construed that these representative bodies presented an overview of whole newspaper industry apart from the information being collected from the individual establishment.

It was further stated that ample of opportunity was provided to stakeholders to give financial date and representation but many of the petitioners did not bother to even attend the proceedings of Wage Board and submit financial data. The Supreme Court also provided the details of the meetings and oral hearings conducted by the Wage Boards.

The petitioners had stated that the procedure adopted by Wage Boards was not correct and no reasonable time was provided to them to reflect on the issues raised in the Wage Boards proceedings. The court stated that it has carefully examined all the proceedings of the Wage Boards and it is satisfied that Wage Board conducted meetings and ample of opportunity was provided to the employers. The petitioners cannot be allowed to take advantage of their own wrongs and impugn the recommendations of the Wage Boards as not being based on their data, when they themselves avoided to submit the data.

The Court further stated that the classification of newspaper establishments and newspaper agencies adopted by the Wage Boards is not arbitrary. The Court provided that representatives of employees agreed for 11 Classification and representatives of employers opposed the said pattern of classification. Later the classification was further reduced into eight Classes.

Class Gross Revenue
I Rs. 1000 crore and above
II Rs. 500 crore and above but less than Rs. 1000 Crore
III Rs. 100 crore and above but less than Rs. 500 crore
IV Rs. 50 crore and above but less than Rs. 100 crore
V Rs. 10 crore and above but less than Rs. 50 crore
VI Rs. 5 crore and above but less than Rs. 10 crore
VII Rs. 1 crore and above but less than Rs. 5 crore
VIII Less than Rs. 1 crore

Therefore, if anybody is aggrieved by the recommendation of Wage Boards to adopt eight classifications, they are employees and not employers. Further no prejudice is caused to employers and they cannot make this as a ground to challenge the report.

The petitioners contended that there were two resolutions passed by the Wage Boards that it was not allowed to function independently and was treated with contempt by the Secretariat of Wage Boards and officials of the Wage Boards. The Chairman and members of the Wage Boards express their concern that issues pertaining to Wage Boards should not be directly dealt with the Ministry and it has to be referred to ministry by the Secretariat after obtaining the permission of the Chairman. The other resolution which was recorded was with the Ministry for Labour and Employment. The Court stated that these two resolutions have no bearing on the ultimate recommendations made by the Wage Boards and therefore, petitioners cannot rely on these resolutions to declare the Wage Boards unconstitutional to impugn. Therefore, the court came to the conclusion that legitimate approach was followed by the Wage Boards and all decisions which were taken were in the presence of all the Wage Board members and no irregularity was adopted in the Wage Boards.

The Court also discussed about the capacity of individual newspaper establishment and reiterated the case of Express Newspaper Pvt. Ltd. and stated that capacity of newspaper industry to pay is one of the essential circumstances to be taken into consideration while fixing rates of wages under the Act. The decision of the Wage Boards in that case was sat a side on the ground that it failed to consider the capacity of the industry to pay the revised wages.

Majithia Report elaborately discussed on the capacity to pay. It was the stand of the petitioners that although the report purportedly examined the capacity to pay but such evaluations were directly contrary to the principle of accepted materials, factors which the report itself identifies as to be legally sound governing the consideration of the capacity to pay.

The court said that it is satisfied that the comprehensive and detailed study has been carried out by the Wage Boards by collecting all the relevant material information for the purpose of the Wage revision. It cannot be held that the Wage structure recommendations by the Majithia Wage Boards is unreasonable.

The petitioners also stated that Newspaper Agencies including PTI stood on a separate footing from newspapers because they did not have any advertisement revenue and hence the wages will have to be fixed separately and independently. Respondents replied on the above contention that the capacity to pay of news agencies was determined on the basis of capacity to earn of the news agencies in every Wage Boards. The burden of revised wages was met by news agencies on every occasion by revising the subscription rate. The court in this regard stated that the court has limited jurisdiction to look into this aspect.

Petitioners further opposed the concept of ‘Variable Pay’ and stated that it was introduced in arbitrary manner. The Counsel for the petitioners submitted that there is no bases for providing the payment on ‘Variable Pay’ and the recommendation is totally unreasonable and will put unnecessary burden on the newspaper establishments. The respondents on the other hand stated that there is a gradation of ‘Variable Pay’ and Allowances according to the size of the establishment, wherein smaller establishments are required to pay at a lower rate compared to large establishments. Manisana Wage Boards also recommended a similar dispensation though it did not call it a ‘Variable Pay’.

Manisana Wage Boards recommended a certain percentage of basic pay for newspaper employees which is similar to ‘Variable Pay’ in Majithia Wage Boards. Thus the Majithia Wage Boards categorised the basic pay and variable pay separately. Therefore, the court is satisfied that the Wage Boards were well within its jurisdiction to recommend payment of ‘Variable Pay’.

Petitioners stated that Majithia Wage Boards was simply a copy of Sixth Central Pay Commission. The Court stated that it has carefully scrutinized all the details and it is clear that the Sixth Pay Commission have not been blindly imported by the Majithia Wage Boards. The court further stated that the concept of Variable Pay, which was recommended by the Sixth Pay Commission has been incorporated by Majithia Wage Board only to ensure that the wages of newspaper employees are at par with those employees who are working in other government sectors. This incorporation was made by Majithia Wage Boards to ensure equitable treatment to employees of newspaper industries.

The Court further stated that the Majithia Wage Boards has recommended grant of 100% neutralization dearness allowance. Fifth Pay Commission also granted the same and since than Public sector undertakings Banks and Private Sector all are granting 100% of neutralization of dearness allowance.

Petitioners also objected about the Wage Boards not taking into account regional variations which the court found to be wrong on the part of the petitioners and Court clarified that Wage Boards have categorised the transport allowances and HRA into X, Y and Z category, which reflects the cost on accommodation and transport in different regions of the country. There is a gradation of Variable Pay and allowances according to the size of the establishments. So, Wage Boards have followed well laid down principles and norms while making recommendations.

The court also clarified the role of the Central Government and also discussed its power and functionality. The court while quoting section-12 of the Newspaper Employees and Miscellaneous Provisions Act, 1955 stated that the Central Government will have the power to modify in the recommendations. It lacks power to make important alteration in the recommendation and if the government thinks any important alteration or changes have to be made then it has to issue a notice to the person who are affected by such alteration. The court, therefore, stated that some of the matters which were not accepted by the Central Government pertaining to retirement age, pension, paternity leave etc. were beyond the main object of the Wage Boards. Therefore, the fact that in the Wage Boards the Government has not accepted few recommendations will not affect the validity of the entire report.

The Court accordingly held the recommendations of Majithia Wage Boards valid and genuine and found that it is not affecting and interfering Article – 32 of the Constitution and therefore, the Writ Petition was dismissed and the Court stated that the Wage Board shall be payable from 11.11.2011 from the date of the notification and all the arrears shall be payable to the persons in four equal instalments upto March 2014.

The employers side was represented by top lawyers like Fali Nariman, K.K. Venugopal, P.P. Rao, Gopal Jain, S.A. Sundaram etc. But the employees were represented only by three Advocates namely Shri Collin Gonsalves, Parmanand Pandey and Thampon Thomas. The Union of India was represented by the then learned Solicitor General Mohan Parasaran.

The historic judgment was delivered on 07.02.2014 by the then Chief Justice of India Shri Sathasivam. The other judges in the hearing of the case were: Justice Ranjan Gogoi and Justice Shiva Kirti Singh.