Supreme Court rules against bank employees' claim for customary bonus payment

The Supreme Court dismissed the appeal by two bank employees seeking a customary bonus payment on the eve of Pooja every year, irrespective of profit or loss. The Court held that the bonus did not meet the criteria for customary bonus as it was not paid over an unbroken series of years, independent of profits, and at a uniform rate. The employees failed to establish an implied agreement for such payment as a condition of service. The Court emphasized the need for uniform treatment of employees in nationalized banks and affirmed the Labour Court's decision to dismiss the claim. The employees were not entitled to the claimed bonus amount.

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Issues:
Claim for customary bonus payment irrespective of profit or loss; Existence of implied agreement for bonus as a condition of service; Jurisdiction of Labour Court under Section 33-C(2) of Industrial Disputes Act; Applicability of tests for customary bonus payment; Nationalized bank employees' entitlement to customary bonus.

Analysis:
The appeal before the Supreme Court involved two employees of a bank claiming a customary bonus payment on the eve of Pooja every year, irrespective of profit or loss, challenging the decision of the Labour Court. The Labour Court dismissed the claim, stating that the bonus did not meet the criteria for customary bonus and lacked an existing right or implied agreement for such payment as a condition of service. The employees argued that the bonus, paid consistently for 16 years, had become a condition of service, but the bank contended that bonus payments were related to profits and not based on custom.

The Supreme Court analyzed the historical bonus payments made by the bank, noting fluctuations in rates and the absence of uniformity, indicating that bonuses were paid in response to employee demands and related to profits. The Court referred to the tests for customary bonus payment laid down in Vegetable Products Ltd. v. Their Workmen, emphasizing the need for payments over an unbroken series of years, independent of profits, and at a uniform rate, which the claimed bonus failed to meet. The Court highlighted the bank's consistent stance that bonuses were profit-related and paid after discussions with employees, undermining the existence of an implied agreement for customary bonus.

Additionally, the Court considered the broader implications of granting customary bonus claims in nationalized banks, emphasizing the need for uniform treatment of employees across such institutions to prevent inequality and disharmony. The Court concluded that the employees had not established a legal right to customary bonus as known in law, affirming the Labour Court's decision to dismiss the claim. Ultimately, the appeal was dismissed, and the employees were not entitled to the quantification of the claimed bonus amount under Section 33-C(2) of the Industrial Disputes Act.

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