Kerala High Court holds that Contractual Employees cannot be terminated without Following Due Process

Recently, two persons were terminated from service, working as an attendee and a part-time sweeper in Ayush NHM Homeopathic Dispensary by the Mananthavady Municipality. In light of this, the Justice Anu Sivaraman of the Kerala High Court, in the case of Tintu K. &Anr. v. Union of India &Ors.[1] highlighted and held that even employees working on a contractual basis cannot be terminated for ‘unsatisfactory performance’ without following due process, which includes issuing notice or such finding for termination.

Analyzing the Judgment

Contentions of the Parties

The Petitioners submitted that they were appointed after a due selection process and had continuously been working from 2010 and 2016 onwards. The Government had issued orders that such employees, who were appointed on a contract basis for a particular project or scheme were not required to be discontinued as per general orders for temporary employees. However, despite such Government Orders, the impugned order was passed holding that the Government Orders were not applicable in this case. They further contended that the petitioners were not issued any show cause notice for the alleged ‘unsatisfactory performance’ and that no performance appraisal was conducted as well.

The Respondents, however, contended that after the Court’s directions in the previous round of litigation, the Director had examined the situation and concluded that the Government Orders were inapplicable to the Petitioners. They further submitted that the Petitioners were only contractual employees and did not have an indefeasible right to their employment. It is also the contention of the Respondents that the Petitioners were not employed as per due process, as under Rule 9 or 9A[2] of the Kerala State and Subordinate Services Rules, 1958 (KS&SSR).

Court’s Decision

The Hon’ble Court observed that the Petitioners are contractual employees and do not have a claim for permanent appointment. However, the termination was owing to deficiencies in their services as they were found to be unsatisfactory. In this regard, the Court observed that irrespective of the Petitioners being contractual employees, they would be entitled to a notice regarding such unsatisfactory performance and they could only be terminated when such a finding is given. In the present case, there was no such notice or finding, which is perversive.

Conclusion

The Court, in this case, upheld the rights of contractual employees and observed that were also entitled to notice and finding of termination if it happens for unsatisfactory performance. Hence, the order of termination was set aside and the Petitioners were allowed to be reinstated and continue their services. The Court, however, also held that the Municipality was entitled to take appropriate measures against them, albeit only by following due process and issuing notice.

[1]Tintu K. &Anr. v. Union of India &Ors., WP(C) No. 26934 of 2022.

[2] Rule 9 & 9A, Kerala State and Subordinate Services Rules, 1958.