Karnataka HC Orders Regularisation Of Long-Serving Mangalore Workers | Continued Outsourcing Defeats Contract Labour Abolition Order
Isabella Mariam
The High Court of Karnataka Single Bench of Justice S. Sunil Dutt Yadav held that the rejection of a request for regularisation of services of contract employees by the Deputy Commissioner and the Mangalore City Corporation was not sustainable in law. The Court directed the respondents to regularise the petitioners' services within 60 days. The Court partially set aside the communications rejecting the regularisation request and held that petitioners were entitled to continuity of service and post-retiral benefits from the date of completing ten years of service.
The petitioners had rendered services to Mangalore Mahanagara Palike (Mangalore City Corporation) as contract employees, primarily as valvemen and pump operators, over a span of 28 years. Despite their longstanding service, their request for regularisation was rejected through communications dated 05.12.2019 and 12.12.2019, issued by the Commissioner of the Municipal Corporation and the Deputy Commissioner respectively.
The dispute arose from the continued engagement of the petitioners through contractors, even after the Government of Karnataka had abolished contract labour in the Water Supply Department of the Corporation on 02.11.2006, pursuant to Section 10 of the Contract Labour (Regulation and Abolition) Act, 1970.
The petitioners relied on various documents and government communications to assert that they had rendered continuous and necessary services akin to those performed by permanent employees. The relevant materials included:
- An office note from the Corporation (22.01.2016) identifying the petitioners as long-term contract workers.
- A 2014 recommendation to regularise their services.
- A government order dated 02.11.2006 abolishing contract labour in the department.
- A report prepared by the Deputy Labour Commissioner recommending abolition of contract labour in water supply operations.
- A subsequent report that included the petitioners’ names following complaints of omission in the original list.
Despite these findings, the Corporation and the Deputy Commissioner excluded the petitioners from regularisation. Their reasoning was based on four criteria from the Supreme Court's judgment in State of Karnataka v. Umadevi, particularly regarding lack of documentation proving ten years of continuous service and engagement against sanctioned posts prior to the cut-off date of 10.04.2006.
The petitioners contended that the initial reliance on outsourcing arose due to the government’s ban on recruitment and that they had consistently worked against vacant, sanctioned posts. They argued that the ban could not be used to perpetuate temporary employment indefinitely, especially when their services were for core and perennial functions.
The petitioners further cited judgments of the Supreme Court in Shripal v. Nagar Nigam, Ghaziabad and Jaggo v. Union of India, asserting that the use of contract labour as a means to avoid legitimate recruitment obligations could not be sustained. They argued that even post-abolition of contract labour, their continued service through outsourcing reflected a de facto employer-employee relationship with the Corporation.
The Corporation's objections, primarily that the petitioners had not completed ten years of service prior to the 2006 cut-off and were engaged through contractors, were challenged by pointing to the absence of credible documentation from the employer and the direct nature of supervision and payment in practice.
The Court noted that through the additional report on contract labour, the petitioners’ names had effectively been included among those employees whose engagement through contractors was found to be in violation of the provisions of the applicable statute. Consequently, the petitioners could be regarded as employees whose employment through a contractor was abolished by the government order dated 02.11.2006.
Having now approached the Court, the petitioners sought the regularisation of their services by relying on the Supreme Court's judgment in Umadevi. It was also evident from the statement of objections that the petitioners had continued to render services to the Mangalore Mahanagara Palike through an outsource agency.
In a communication dated 05.12.2019, the Mangalore Mahanagara Palike made a recommendation to the Deputy Commissioner, recording that sixteen employees, including the petitioners, had not satisfied the four criteria laid down in the Umadevi judgment. However, from the analysis of Annexures W and X, it was clear that findings related to the petitioners’ qualifications and their work against sanctioned posts were in their favour.
The Supreme Court in Shripal and Jaggo acknowledged that contract labour and outsourcing arrangements had been used as mechanisms to bypass direct recruitment procedures. A relevant example cited was the landmark United States decision in Vizcaino v. Microsoft Corporation, which illustrated the judiciary’s corrective role in addressing the misclassification of workers and ensuring their fair treatment.
The Court observed that temporary employees, especially within government institutions, often experience various forms of exploitation. These practices, initially intended for addressing short-term needs, had evolved into tools for avoiding long-term employment obligations.
Importantly, the Court recorded that the Umadevi judgment could not be used to undermine the legitimate claims of long-serving employees. The ruling itself made a distinction between illegal and irregular appointments and had intended to safeguard employees who were engaged in sanctioned posts and had served continuously for over ten years. However, the purpose of this precedent was being undermined when authorities cited it to summarily dismiss claims, even when procedural irregularities did not render the appointments illegal.
Furthermore, the Court held that a general ban on recruitment could not be used to deprive long-serving workers of their employment protections. In instances where employers failed to produce complete muster rolls, such failure permitted the Court to draw an adverse inference in accordance with settled labour jurisprudence.
The Court held that the communications at Annexures W (dated 05.12.2019) and X (dated 12.12.2019), which had rejected the petitioners’ claim for regularisation, are partially set aside.
The Deputy Commissioner, Mangalore, is directed to pass an order of regularisation forthwith, in light of the observations and conclusions made in the judgment.
It is clarified that the petitioners are entitled only to continuity of service and the period served would be counted for post-retiral benefits.
The effective date of regularisation is to be computed from the dates on which the petitioners completed ten years of service, as listed in the annexure to the Deputy Commissioner’s Order dated 28.07.2016
The Court directed that the order of regularisation must be passed within 60 days from the date of receipt of a copy of the Court’s judgment.
“Accordingly , the writ petition is disposed off”.
Advocates Representing the Parties
For the Petitioners: Sri. Gowthamdev C. Ullal, Advocate
For the Respondents: Smt. B.P. Radha, AGA ; Sri. Hareesh T. Bhandary, Advocate; Smt. Sahana, Advocate
Case Title: Sri Bhagwan Das & Others v. The Deputy Commissioner & Others
Neutral Citation: 2025:KHC:20774
Case Number: WP No. 4478 of 2022
Bench: Justice S. Sunil Dutt Yadav
[Read/Download order]
