Employer-employee relationship in canteen cases depends on effective control, not mere subsidy or infrastructure support.

An employer-employee relationship between a principal establishment and canteen staff is not established merely because the establishment provides infrastructure, subsidies, or supervision of subsidy use. The decisive factors are appointment, payment, disciplinary control, continuity of service, and effective administrative control over the canteen and its workers. Where the canteen is run through a society or intermediary that recruits and manages the staff, and the principal employer has no direct role in recruitment, discipline, or administration, the workers are not employees of the principal establishment. On these facts, the finding of master-servant relationship failed, and reinstatement with back wages could not be sustained.

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Issues: Whether the canteen workers were employees of the Bank and whether their termination on closure of the canteen gave them a right to reinstatement with back wages.

Analysis: The decisive enquiry was whether an employer-employee relationship existed between the Bank and the canteen workers. The governing indicators included who appointed the workers, who paid them, who had disciplinary power, continuity of service, and the extent of control and supervision. The Bank had provided infrastructure and subsidies, but the canteen was set up and run through the Society, which engaged the workers. Mere financial assistance, provision of facilities, or monitoring of subsidy utilisation did not by itself establish a contract of service. The authorities on canteen workers show that a canteen becomes part of the establishment only where there is statutory or other legal obligation to maintain it, or where the employer exercises effective and complete administrative control over its running and over the workers. On the facts, the Bank had no direct role in recruitment, discipline, or management of the canteen staff, and the Society retained the operational control.

Conclusion: The canteen workers were not employees of the Bank, and the finding of master-servant relationship was unsustainable. The order of reinstatement with back wages could not stand.

Ratio Decidendi: In the absence of statutory obligation or effective and complete control over the canteen workers, provision of infrastructure and subsidy for a canteen does not by itself create an employer-employee relationship between the principal establishment and the workers engaged by the society or intermediary running the canteen.

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