Introduction:
The case of Radheshyam Verma v State of Madhya Pradesh [WP-3641-2020] came before the Madhya Pradesh High Court, presenting a significant question concerning labour rights, equality, and the State’s obligations towards long-serving contractual and outsourced employees. The petitioner, Radheshyam Verma, along with similarly placed workers, approached the Court seeking directions for the grant of permanent status and corresponding service benefits.
The dispute revolved around a circular issued by the State Government on October 7, 2016, which aimed to classify daily wage workers into categories such as skilled, semi-skilled, and unskilled, and to extend certain benefits to those who could not be formally regularised. However, the benefit of this policy was denied to contractual, outsourced, and part-time workers, even when they had been engaged continuously for long periods.
The matter was adjudicated by Justice Vishal Dhagat, who examined whether such exclusion was legally sustainable and consistent with constitutional principles. The Court was particularly concerned with the plight of workers who had been engaged repeatedly over several years, performing essential functions, yet denied fair wages and job security.
The judgment ultimately addressed the broader issue of whether the State could justify differential treatment between daily wage workers and contractual employees when both categories were similarly situated in terms of duration and nature of service.
Arguments by the Petitioners (Workers):
The petitioners argued that they had been initially engaged on a contractual basis as early as 2009 and had continued to render uninterrupted service for over a decade. Despite their long tenure and the ongoing requirement of their services, they were denied the benefits that were extended to daily wage workers under the State’s 2016 policy.
A central contention was that the State’s refusal to classify them and extend corresponding benefits amounted to a violation of their fundamental rights under Articles 14 and 16 of the Constitution. The petitioners argued that they were being treated unequally compared to similarly placed daily wage workers, despite performing comparable duties and working under similar conditions.
They further contended that the State was exploiting their vulnerable position by continuing to engage them on a contractual basis without offering job security or fair wages. According to them, this practice not only deprived them of economic stability but also undermined their right to a dignified life.
The petitioners emphasized that the repeated extension of their contracts clearly indicated a permanent and ongoing requirement for their services. In such circumstances, denying them the benefits of classification and minimum pay scales was arbitrary and unjust.
It was also argued that the 2016 circular was intended to provide relief to workers who could not be formally regularised, ensuring that they receive at least a minimum standard of living. By excluding contractual and outsourced workers from its ambit, the State had defeated the very purpose of the policy.
The petitioners urged the Court to direct the State to classify them in accordance with the circular and to grant them all consequential benefits, including payment of wages at the minimum of the pay scale applicable to their posts.
Arguments by the Respondent (State Government):
The State Government defended its position by relying on the policy framework established through the circular dated October 7, 2016. It argued that the policy was specifically designed for daily wage workers who could not be regularised, and that it clearly defined the categories of workers eligible for its benefits.
According to the State, contractual, outsourced, and part-time employees formed a distinct class and were governed by different terms and conditions of employment. Therefore, extending the benefits of the circular to such workers would amount to altering the scope of the policy beyond its intended purpose.
The State further contended that contractual employment is based on specific agreements that define the rights and obligations of both parties. Employees who voluntarily accept contractual terms cannot later দাবি benefits that are inconsistent with those terms.
It was also argued that extending benefits to contractual workers could have significant financial implications for the State and disrupt the existing administrative framework. The Government Advocate emphasized that policy decisions involving financial and administrative considerations fall within the domain of the executive and should not be interfered with by the judiciary unless they are manifestly arbitrary.
Additionally, the State maintained that the classification of workers under the 2016 circular was a conscious policy decision aimed at addressing the needs of a specific category of employees. It argued that the exclusion of contractual workers was neither arbitrary nor discriminatory, but rather based on a rational classification.
Court’s Judgment:
The Madhya Pradesh High Court undertook a detailed examination of the facts and the legal principles involved, ultimately finding merit in the petitioners’ claims.
At the outset, the Court noted that the petitioners had been continuously engaged by the State Government for more than a decade, with their contracts being extended repeatedly. This, according to the Court, clearly demonstrated a constant and ongoing requirement for their services.
The Court observed that merely labeling workers as “contractual” or “outsourced” cannot be a ground to deny them fair wages and benefits when their work is of a permanent and continuous nature. It held that such classification, in substance, must reflect the reality of the employment relationship rather than its formal designation.
In a significant observation, the Court held that there was no rational basis for excluding contractual, outsourced, and part-time workers from the benefits of the 2016 circular, particularly when they had been engaged for more than 10 years. The Court emphasized that the principle of equality under Articles 14 and 16 requires that similarly situated individuals be treated alike.
The Court further highlighted the constitutional mandate to ensure social and economic justice, referring to the Directive Principles of State Policy under Articles 38, 39, and 43. It noted that the State has an obligation to provide workers with adequate means of livelihood, fair wages, and a decent standard of life.
The Court found that the denial of classification and corresponding benefits to the petitioners was inconsistent with these constitutional principles. It held that the State’s policy, which was intended to improve the living conditions of workers, should not be applied in a manner that excludes a significant segment of employees who are equally deserving.
Rejecting the State’s arguments, the Court concluded that the exclusion of contractual workers from the benefits of the circular was irrational and arbitrary. It held that such exclusion amounted to discrimination and could not be sustained in law.
Accordingly, the Court allowed the writ petition and directed the State Government to classify the petitioners in accordance with the circular dated October 7, 2016. It further directed that all consequential benefits, including payment of wages at the minimum of the pay scale applicable to their posts, be extended to them.
The judgment thus reinforces the principle that the State cannot evade its obligations towards workers by resorting to contractual arrangements, especially when such arrangements are used to deny fair wages and job security.