CHENNAI: In a significant ruling that could impact the regularisation of contract workers in public sector undertakings, the Madras High Court has held that contract labourers are entitled to permanent job status if they have completed 480 days of service within two years.

Justice D Bharatha Chakravarthy delivered the judgment while dismissing a batch of appeals filed by the chairman of Tamil Nadu Power Distribution Corporation Limited (TNPDCL), formerly Tangedco. The petitions sought to quash the orders issued in favour of the workers by the assistant commissioner of Labour (Enforcement) on 28 April 2023.

Advocate G Anand Gopalan, representing the petitioners, argued the labourers had not rendered continuous service of 480 days, as they were transferred from the management’s control to the control of the contractors and that there was no employer-employee relationship between the management and the workers.

He also said the workers were not under the settlement reached as per Section 12 (3) of the Industrial Disputes Act, 1947, and therefore, could not be considered for regularisation.

Advocate NGR Prasad, appearing for the workers, contended they were originally appointed directly by the management before being transitioned to contract labourers. Since they had completed 480 days directly under the management, Section 3 of the Tamil Nadu Industrial Establishments (Conferment of Permanent Status to Workmen) Act, 1981, deemed them permanent employees.

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