LIC bound by Constitution: SC directs verification of workers' claims

The Supreme Court on Wednesday said that the LIC, as a statutory corporation, is bound by the mandate of the Constitution's Articles 14 and 16, and the public employer cannot be directed to carry out mass absorption of over 11,000 workers without following a recruitment process, consistent with the principles of equality of opportunity.

A bench headed by Justice D.Y. Chandrachud said: "LIC, as a statutory corporation, is bound by the mandate of Articles 14 and 16 of the Constitution. As a public employer, the recruitment process of the corporation must meet the constitutional standard of a fair and open process. Allowing for back-door entries into service is an anathema to public service."

The apex court appointed a committee consisting of Allahabad High Court's former Justice P.K.S. Baghel and former district judge Rajiv Sharma of the Uttar Pradesh Higher Judicial Services to carry out a fresh verification of the claims of workers who claim to have been employed for at least 70 days in Class IV posts over a period of three years or 85 days in Class III posts over two years between May 20, 1985 and March 4, 1991.

Dealing with a nearly four-decade old dispute in connection with part-time workers of the LIC, the top court said: "The claims of those workers who are duly found upon verification to meet the threshold conditions of eligibility should be resolved by the award of monetary compensation in lieu of absorption, and in full and final settlement of all claims and demands."

The bench, which also comprised Justice Surya Kant and Vikram Nath, said: " A public employer such as LIC cannot be directed to carry out a mass absorption of over 11,000 workers on such flawed premises without following a recruitment process which is consistent with the principles of equality of opportunity governed by Articles 14 and 16 of the Constitution."

It added that such an absorption would provide the very back-door entry, which negates the principle of equal opportunity and fairness in public employment.

The bench said that all persons who are found to be eligible on the above norm shall be entitled to compensation computed at the rate of Rs 50,000 for every year of service or part thereof.

"The payment of compensation at the above rate shall be in lieu of reinstatement, and in full and final settlement of all claims and demands of the workers in lieu of regularisation or absorption and notwithstanding the directions issued by this Court in TN Terminated Employees Association (supra)," it added, in the 90-page judgement.