LexSTANDARD VACUUM REFINING CO. OF INDIA versus ITS WORKMEN AND ANOTHER.
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Union of India v. MaharaJa Krishnagarh i-. Mills Ltd. Sinha C.J. January 20. 536 SUPREME COURT REPORTS [1961] is that the writ petition filed by the respondent in the High Court stands dismissed with costs here and in the High Court. Appeal allowed. STANDARD VACUUM REFINING CO. OF INDIA v. ITS WORKMEN AND ANOTHER. (P. B. GAJENDRAGADKAR, K. N. WANCHoo and K. c. DAS GUPTA, JJ .. ) Industrial dispute-Bonus-Living Wage, determination of. The workmen claimed bonus for the year 1956 equivalent to nine months' total earnings on the ground that the employers had admitted their capacity to pay and that there was a big gap between the wage actually received and the living wage. The employers contended that they were paying the workmen a living wage and they were not entitled to any bonus. The employers relying mainly on the Report of the Textile Labour Committee, 1940, contended that if the living wage in 1940, i.e., R,s. 55/· was multiplied by 3·5 (due to rise in prices) it gave Rs. 192·50 as the living wage in 1956 and they were paying their workmen at a higher rate. The workmen relied on the recommendations of the Indian Labour Conference, 1957, to show that Rs. 209·70 approxi- mat.ed to the standard of the need-based minimum wage and that the average. wag:e paid by the employers was nothing more than this. The Tribunal held that the wages paid were fair but that there was still a gap between the actual wage and the living wage and awarded bonus equivalent to five months' basic wages. Held, that the employers had failed to establish that they were paying a living wage to the workmen. In construing wage structure the considerations of right and wrong, propriety and impropriety, fairness and unfairness are also taken into account to some extent. As the social conscience of the general commu- nity becomes more alive and active, as the welfare policy of the State takes a more dynamic form, as the national economy pro- gresses from stage to stage, and as under the growing strength of the trade union movement collective bargaining enters the field, wage structure ceases to be a purely arithmetical problem. Wages are usually divided into three broad categories: the basic rninin1um wage, the falr wage and the living \vage. The concept of these three wages cannot be described in definite words as their contents are elastic and vary from time to time and fro111 place to place. The concept. of a living wage js not a static con- cept; it is expanding and the numb·er of its constituents and their I 3 S.C.R. SUPREME COURT REPORTS 537 respective contents art bound to expand and widen with the I96I development and growth of national economy. In an under- developed country no wage structure could be described as Sta•dard Vacuu"' reaching the ideal of a living wage. It is unreasonable and unsafe Rejini•g Co. •I to treat the Report o! the Textile Labour Committee, 1940, as to India the monetary value of the Jiving wage in 1940 as sound. The v. figure reached.by the committee in 1940 did not represent any- Its Workm1• thing like a living wage; it really represented the minimum need. based wage. Besides, the method of multiplying the figure by 3·5 was materially defective; the proper approach was to evaluate each constituent of the concept of the living wage iii the light of the present day prices. Even the highest average wage paid by the employers was much below the standard of the living wage though it was above the need.based minimum. Express Newspapers (P.) Ltd. 'l· Union of India, [1959] S.C.R. 12, Standard Vacuum Oil Company v. Their Workmen, [1952] 1 L.L.J. 839, Burmah Shell, etc., Oil Companies in Madras v. Their Employees, [1954J r L.L.J. 782, Workers of S.V.O.C. Ltd. (Standard Vacuum Employees' Union) v. Standard Vacuum Oil Co. Ltd., (1957] 1 L.L J. 165 and Standard Vacuum Oil Company v. Thtir Emplo- yeef, [1954] l L.L.J. 484, referred to. Burmah-SheU Oil Storage and Distributing Co. of India, Ltd., Bombay v. Their Workmen, [1953] 2 L.L.J. 246, approved. Quaere :-Whether the workmen would be entitled to bonus ever> if a living wage is paid to them by the employers. Muir Mills Co. Ltd. v. Suti Mills Mazdoor Union, Kanpur, [1955] r S.C.R. 991 and Sree Meenakshi Mills Ltd. v. Their Work- men, [1958] S.C.R. 878, referred to. CIVIL APPELLATE JURISDICTION: Civil Appeals Nos. 416 of 1!158 an.; 19 of 1959. Appeals by special leave from the Award dated Jan
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