Inclusion of ‘self employed persons’ under the Kerala Motor Transport Workers Welfare Fund Act

The Kerala High Court (in Ernakulam District Bus Operators’ Organization and Others v. State of Kerala) considered the constitutional validity of the Amendment Act 23 of 2005, which included ‘self employed persons‘ under the ambit of the Kerala Motor Transport Workers Welfare Fund Act, 1985. The Petitioners contended that inclusion of ‘self employed persons’ under the Transport Workers Welfare Scheme is arbitrary and beyond the legislative competence of State . They also alleged that by such inclusion, unequal are treated equally and thereby violated Article 14 of the Constitution.

The Division Bench of the Kerala High Court consisting of Justice C. N. Ramachandran Nair & Justice P. S. Gopinathan held that “we do not find any distinction in vehicle operation pointed out by the petitioners between the two categories i.e. persons running the business as operators or entrepreneurs engaging workers and another set of people engaged in motor vehicle business by employing themselves. In the latter category the registered owner cum permit holder acts in a duel capacity because as the registered owner and as employer he employs himself to operate the vehicle which is nothing but self-employment. The contention that registered owners operating vehicles by themselves are not in the same position as registered owners operating the vehicles with employees, may be correct. However, in our view, self employed persons will be able to make better margins because they have no over heads for supervision or expenditure by way of payment of wages to owner employees. So far as the requirement of payment of contribution is concerned, the legality or correctness of the same has to be considered with reference to the object of the Scheme, which is undoubtedly benefit only for the very same persons who are challenging it.We, therefore, do not find any distinction between the category of motor workers originally covered under the Act and the category now being covered who are essentially motor workers engaged in their own vehicles. Consequently, we reject the challenge against the constitutional validity of Section 2(ja) and corresponding provisions of the Act on grounds of arbitrariness or violation of Article 14 of the Constitution.”

However, the petitioners were able to point out disparity between the two classes of workers in receiving benefit under the Motor Transport Workers Welfare Fund Scheme. The High Court on consideration declared that “self employed persons should be given the same benefits which other motor workers covered by the Act are given. If there is any difficulty in working out any relief such as those provided with specific reference to “salary”, to self employed persons, the Board should fix salary on notional basis to self employed persons by taking the salary structure of similar employees and then give the benefit at equal rate as entitled to other persons.”

In my considered opinion, the above judgment is not a good law. The court has not considered whether the legislation infringes Article 21 ‘Right to life and Liberty’ of the person. There is no way a ‘self-employed-person’ can be enrolled forcefully in a welfare fund/insurance scheme by the State. He should be given the ‘liberty’ to decide whether to save or spend his savings. The State may legislate on a matter concerning welfare of labour/motor-workers, in general. But it has no legislative competence to dictate terms of savings to a Single Citizen/Self-employed Person.

An analogy can be drawn to the recent developments in USA, where the HeathCare Law introduced by President Obama was struck down by 11th Circuit Court of Appeals as it violated ‘Individual Mandate’ of a Citizen and sought compulsory insurance of all the people. In India, individual rights and liberty of a citizen under Article 21 are much broader than that of United States, and for the same reason, the above judgment which forces compulsory welfare scheme on a person, is illegal and ultra vires the constitution.

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About Thomas Geeverghese

Advocate, Ernakulam
This entry was posted in Labour Law Kerala, Transport Workers and tagged , . Bookmark the permalink.

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