Apprenticeship Termination Upheld: Supreme Court Rules on Labour Court's Reinstatement Order

The case of Ram Gopal Dwivedi v. M/s Kanpur Electricity Supply Co. Ltd. revolves around the termination of trade apprentices under the Apprentices Act, 1961 and whether they were entitled to the protection of labour laws. The Supreme Court had to decide whether the termination was legal or if the Labour Court had rightly ordered reinstatement.

Background of the Case

The appellants, Ram Gopal Dwivedi and Raj Govind Singh, were engaged as trade apprentices by Kanpur Electricity Supply Co. Ltd. (KESC), which is a unit of the U.P. State Electricity Board (UPSEB). They were appointed under the Apprentices Act, 1961 for a fixed-term training period of three years in the trade of Boiler Attendant/Cable Jointer. Their contracts specified that their training would conclude after the contract period expired.

Upon completion of the training, the employer terminated their services:

Ram Gopal Dwivedi’s apprenticeship ended on August 1, 1989.
Raj Govind Singh’s apprenticeship ended on July 13, 1990.

Feeling aggrieved, the appellants challenged their termination before the Labour Court, Kanpur, which ruled in their favor. The Labour Court found that:

The apprentices were not given retrenchment compensation before termination.
No disciplinary inquiry was held against them.
Since they had worked for over two years, they were entitled to the protection of labour laws.
Their termination was illegal, and they were reinstated with 50% back wages.

The employer, Kanpur Electricity Supply Co. Ltd., challenged the Labour Court’s order in the Allahabad High Court. The High Court ruled in favor of the employer, setting aside the reinstatement order and ruling that the termination was legal. The appellants then approached the Supreme Court.

Key Issues Before the Court

Were the apprentices entitled to protection under labour laws?
Did their termination violate the Industrial Disputes Act, 1947?
Did the Labour Court err in ordering reinstatement?
Did the High Court correctly apply legal precedents?

Arguments of the Petitioners (Ram Gopal Dwivedi & Raj Govind Singh)

The petitioners contended:

They had worked as apprentices for more than two years and should be treated as regular employees.
The employer did not pay retrenchment compensation before termination, violating Section 25-F of the Industrial Disputes Act.
The Labour Court was correct in ruling that their termination was illegal.
They should be reinstated with back wages as they were workmen under the Industrial Disputes Act.

Arguments of the Respondent (Kanpur Electricity Supply Co. Ltd.)

The employer countered:

The petitioners were appointed as apprentices under the Apprentices Act, 1961, and not as regular employees.
The Apprentices Act does not guarantee permanent employment after the completion of training.
Their termination was in accordance with the contract signed at the time of their appointment.
The Labour Court misapplied the law, and the High Court correctly reversed its decision.

Supreme Court’s Analysis and Judgment

The Supreme Court, comprising R.K. Agrawal and Abhay Manohar Sapre, upheld the High Court’s ruling and dismissed the appeals. The Court made the following key observations:

1. Apprentices Do Not Have a Right to Regular Employment

The Court held that apprentices are trainees and not employees.
Upon completion of training, an employer is not obligated to offer permanent employment.
The petitioners’ termination was not retrenchment but a natural conclusion of their training contract.

2. Labour Laws Do Not Apply to Apprentices

The Court ruled that the Industrial Disputes Act does not apply to apprentices.
Since they were never regular employees, they were not entitled to retrenchment compensation or protection under Section 25-F.

3. Labour Court’s Order Was Erroneous

The Supreme Court held that the Labour Court erred in treating apprentices as regular employees.
It observed that the Labour Court ignored binding precedents and misapplied the law.

4. Reliance on Precedent

The Court relied on its earlier decision in U.P. State Electricity Board v. Shiv Mohan Singh (2004) 8 SCC 402, which dealt with identical facts.
It reaffirmed that apprentices are not entitled to permanent employment under the Apprentices Act.

Final Judgment

The Supreme Court dismissed the appeals and upheld the High Court’s ruling.
The termination of the petitioners was declared legal and valid.
No relief was granted to the petitioners.

Conclusion

This judgment clarifies that apprentices do not have an automatic right to permanent employment. It upholds the principle that apprenticeship training is for skill development, not an offer of employment.

The ruling sets a precedent for future cases involving apprentices and reiterates that:

The Apprentices Act, 1961 does not create employment rights.
Termination at the end of an apprenticeship does not amount to retrenchment.
The Labour Court cannot order reinstatement in such cases.

For employers, this case reinforces the legal position that apprenticeships are training arrangements and should not be mistaken for regular employment contracts.

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