The Bombay High Court recently quashed a notification by Hindustan Petroleum Corporation Limited (HPCL) that discontinued pension to retired employees who were employed between July 1974 and May 1975, among other provisions.
The petition, filed by an association of pensioners representing the retired employees, had sought a quashing of the order. The notification, dated March 14, 2016, effectively discontinued the pension to retired employees; denied the additional relief of ₹500 along with the dearness relief (linked to the All India Consumer Price Index) to employees who retired after June 1994. It also reduced the pension of employees initially with Lube India Ltd. (which was later incorporated into Esso Standard Refining Company of India Ltd.), reduced pension on grounds of increased contribution of the employer towards provident fund and gratuity. Further, a maximum ceiling of ₹20,000 imposed upon monthly pension was also challenged.
HPCL was formed in 1974 after acquisition of shares by Government of India in Esso Standard Refining Company of India and the subsequent merger of Esso and Lube India Ltd. The Bench, comprising Justices Bhushan R. Gavai and N.J. Jamadar set aside the March 14, 2016 notification and declared that the employees recruited between July 1974 and May 1975 are entitled to pension.
The court also declared that the erstwhile employees of Lube India Ltd. are entitled to a pension like the employees of Esso. The order in the notification that provided for recomputing the basic pension was also quashed. Further, the court directed that additional relief of ₹500 be extended to all pensioners and directed that All India Consumer Price Index-linked dearness relief be provided to employees who retired after June 1994 as well.
The rate of pension accrual was set at 1.33% and the action of reducing pension on the grounds of increased contribution to PF and gratuity was quashed.
The court also laid down the formula for re-computation of pension of employees who retired after June 1994,saying they would also be entitled to a yearly increase in dearness allowance as is available to employees who retired before the period.
The court directed HPCL to revise the pension of all retired employees whose pension had been re-computed in accordance with the March 2016 notification.