VRSe retirees entitled to the benefit of an annual increment upon completing 365 days of service in the relevant year
Punjab and Haryana High Court Upholds Increment Benefits for VRS Retirees. The Court affirms no distinction between superannuation and VRS retirees regarding annual increment entitlement
The Punjab and Haryana High Court has delivered a significant judgment affirming that employees retiring under the Voluntary Retirement Scheme (VRS) are entitled to receive the benefit of an annual increment, provided they have completed 365 days of service in the relevant year before retirement. The judgment was given in the case of Bharat Sanchar Nigam Limited v. Gulshan Sood, where the court dismissed the writ petition filed by Bharat Sanchar Nigam Limited challenging the Central Administrative Tribunal's decision to grant the increment to VRS retirees.
The case was heard by a Division Bench comprising Mr. Harsimran Singh Sethi and Mr. Vikas Suri, JJ., who upheld the Tribunal’s order allowing the respondents, who retired on 31st January 2020 under the VRS scheme, to receive the increment that accrued on the succeeding day of their retirement. The petitioners contended that employees retiring under VRS should not receive the increment as their retirement was not due to attaining the age of superannuation. However, the court found no merit in this argument, stating that the mode of retirement does not affect the entitlement to increment once 365 days of service are completed.
Referring to precedents set by the Supreme Court and various High Courts, the judgment highlighted that denying the increment would lead to arbitrariness and would unjustly punish employees who have completed the requisite service period with good conduct. The court emphasized that increment entitlement crystallizes upon the completion of the necessary service period, and the increment becomes payable on the succeeding day, regardless of whether the retirement was due to superannuation or VRS.
The judgment reinforces the principle that all employees, irrespective of their retirement mode, are entitled to benefits earned through service and good conduct. The decision is a relief to numerous employees opting for VRS, ensuring their pensionary benefits are calculated based on their last drawn salary inclusive of the annual increment.
Bottom Line:
Employees who retire under the Voluntary Retirement Scheme (VRS) are entitled to the benefit of an annual increment upon completing 365 days of service in the relevant year before retirement, even if the increment accrues on the succeeding day of retirement.
Statutory provision(s): None explicitly mentioned in the judgment text.
Bharat Sanchar Nigam Limited v. Gulshan Sood, (Punjab And Haryana)(DB) : Law Finder Doc Id # 2782466
