PRESIDENT K P CO OPERATIVE SOCIETY Vs. REGIONAL DIRECTOR ESI CORPORATION TRICHUR
LAWS(KER)-1974-11-4
HIGH COURT OF KERALA
Decided on November 23,1974

PRESIDENT, K. P. CO-OPERATIVE SOCIETY Appellant
VERSUS
REGIONAL DIRECTOR, ESI CORPORATION, TRICHUR Respondents

JUDGEMENT

- (1.) The short question arising in this case is whether an 'apprentice' is an 'employee' within the meaning of that term in S.2(9) of the Employees' State Insurance Act, 1948, (hereinafter referred to as the 'Act'). An employee is defined in that section as follows: " 'employee' means any person employed for wages in or in connection with the work of a factory or establishment to which this Act applies and - (i) who is directly employed by the principal employer on any work of, or incidental or preliminary to or connected with the work of the, factory or establishment, whether such work is done by the employee in the factory or establishment or elsewhere; or, (ii) who is employed by or through an immediate employer on the premises of the factory or establishment or under the supervision of the principal employer or his agent on work which is ordinarily part of the work of the factory or establishment or which is preliminary to the work carried on in or incidental to the purpose of the factory or establishment; or (iii) whose services are temporarily lent or let on hire to the principal employer by the person with whom the person whose services are so lent or let on hire has entered into a contract of service; but does not include - (a) any member of the Indian Naval, Military or Air Forces; or (b) any person employed on a remuneration which in the aggregate exceeds four hundred rupees a month;" 'Factory' has been defined in S.2(12) as follows: " 'Factory' means any premises including the precincts thereof whereon twenty or more persons are employed or were employed for wages on any day of the preceding twelve months, and in any part of which a manufacturing process is being carried on with the aid of power or is ordinarily so carried on but does not include a mine subject to the operation of the Indian Mines Act, 1923 (IV of 1923) or a railway running shed;" It may be noticed here that the definition as it now appears in the statute book is as amended by Act 44 of 1966. Prior to such amendment in the place of the words "are employed or were employed for wages" the words "are working or were working" found a place. The definition of 'factory' in S.2(m) of the Factories Act, 1948 runs: " 'Factory' means any premises including the precincts thereof - (i) whereon ten or more workers are working, or were working on any day of the preceding twelve months, and in any part of which a manufacturing process is being carried on with the aid of power, or is ordinarily so carried on, or (ii) whereon twenty or more workers are working or were working on any day of the preceding twelve months, and in any part, of which a manufacturing process is being carried on without the aid of power, or is ordinarily so carried on but does not include a mine subject to the operation of the Mines Act, 1952 (XXXV of 1952) or a railway running shed." It may be noticed that the definition is more or less the same as the definition of the term in the Employees' State Insurance Act prior to its amendment by Act 44 of 1966 in so far as it referred to persons who were working and not persons who were employed. The term 'workman' is defined in S.2(s) of the Industrial Disputes Act, 1947 to read: "2(s) 'workman' means any person (including an apprentice) employed in any industry to do any skilled or unskilled manual, supervisory, technical or clerical work for hire or reward, whether the terms of employment be express or implied, and for the purposes of any proceeding under this Act in relation to an industrial dispute, includes any such person who has been dismissed, discharged or retrenched in connection with, or as a consequence of, that dispute or whose dismissal, discharge or retrenchment has led to that dispute; but does not include any such person - (i) who is subject to the Army Act. XLVI of 1950, or the Air Force Act, XLV of 1950, or the Navy (Discipline) Act, XXXIV of 1934; or (ii) who is employed in the Police Service or as an officer or other employee of a prison; or (iii) who is employed mainly in a managerial or administrative capacity; or (iv) who being employed in a supervisory capacity, draws wages exceeding five hundred rupees per mensem or exercises, either by the nature of the duties attached to the office or by reason of the powers vested in him, functions mainly of a managerial nature." This definition, it may be noticed, is as amended by Act 36 of 1956. Prior to such amendment the definition ran: " 'workman' means any person (including an apprentice) employed in any industry to do any skilled or unskilled manual, supervisory, technical or clerical work for hire or reward, whether the terms of employment be express or implied, and for the purposes of any proceeding under this Act in relation to an industrial dispute, includes any such person who has been dismissed, discharged or retrenched in connection with, or as a consequence of, that dispute, or whose dismissal, discharge or retrenchment has led to that dispute, but does not include any such person - (i) who is subject to the Army Act, XLVI of 1950, or the Air Force Act, XLV of 1950, or Navy (Discipline) Act, XXXIV of 1934; or (ii) who is employed in the police service or as an officer or other employee of a prison; or (iii) who is employed mainly in a managerial or administrative capacity; or (iv) who being employed in a supervisory capacity, draws wages exceeding five hundred rupees per mensem or exercises, either by the nature of the duties attached to the office or by reason of the powers vested in him, functions mainly of a managerial nature."
(2.) It is evident therefore that the term 'workman' in the Industrial Disputes Act includes an apprentice since that is categorically so included in the definition. The Employees' State Insurance Act as it stood prior to the amendment by Act 44 of 1966 defined 'factory' so as to take in premises where 20 or more persons were working. That would mean that the twenty may include apprentices also, for, apprentices also 'work' in the premises. It would then be a factory within the meaning of S.2(12) of the Act. But the question is whether it would be a factory after the definition of the term is amended, for in place of the words "are working or were working" the words "are employed or were employed for wages" are substituted. There was specific inclusion of apprentices in the Industrial Disputes Act, 1947. It is in this background that the court has to decide whether the term 'employee' in S.2(9) of the Act is wide enough to take in the case of apprentices who work in the factory.
(3.) In the case before us the contribution was demanded from the employer by the Employees, State Insurance' Corporation for a specific period on the ground that during that period there were 20 workers in the factory, 19 of whom were regular workers and I an apprentice. This is not disputed. The period for which contribution is claimed is 19th March 1968 to 25th January 1969 and special contribution is claimed for the quarters ending 31st March 1968, 30th June 1968, 30th September 1968 and 31st December, 1968. That the apprentice ceased to work on 29th April 1969 is undisputed. But for the apprentice working in the factory there would have been no question of coverage under the Act, for then there would be no factory as defined in S.2(12) and naturally the persons employed cannot be so said to be employed in connection with the work of the factory. It is thus that the definition of the term 'factory' becomes relevant. The question is whether an apprentice is employed for wages. If the definition was, as it stood prior to the amendment, the test would have been whether the apprentice was working in the premises. Of course he could be said to be working as he was working along with the 19 others and that would have made the premises a factory. But if he was merely working as an apprentice and was not employed for wages then the amended definition under S.2(12) of the Act would not apply to the premises and necessarily therefore the persons working there may not be employees within the meaning of the Act. The case of the employer is that it should be found so.;


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