Ref. The letter received from L.I.C of India today, by me.
My letters to you dated 18th June 2023 and 4th August, 2023
It's downright shameful that a respectable (?) public insurer like the Life Insurance Corporation of India has the cheek to give me the same reply that was given to me in 2010 when I had appealed to it asking for a reply to why my wages were repudiated despite beng on the rolls of its service in 2007.
My wages had been repudiated from 1st August, 2007 to 2nd July 2010.
The said clause 3 i has been declared 'ultra vires' (unconstitutional) by the Supreme Court in 2007. The Management of the Corporation had even stated in the reply to my RTI Appeal that the Central Government takes the decision to repudiate the arrears whereas actually the Management of LIC of India takes this obnoxious and illegal decision and sends it for ratification to the Parliament. Even the CIC agreed, after I presented my case, that the Government was just ratifying the decision taken by LIC's Management.
What's even more shocking is that it has been persisting with its illegal act with the full support of the Government of India, since 1997. As you're aware, a Gazette Notification is published as a Charter of Wage Revision, by the Government of India.
"Justice delayed is justice denied" as the old adage goes. Will we, the long suffering, resigning ex-employees of the Corporation ever get justice with this pathetic state of affairs of a state-owned insurer of LIC of India's stature? An esteemed Corporation with an IPO, which even lies to the Prime Minister and the Finance Minister of the nation?
As I had informed you through my first letter, my husband needs long-term or even life-long treatment for his ailment and is currently under observation after a major surgery. I need finances to look after his and my health. I am only asking for my hard-earned dues, not even charity.
Besides, the Corporation has wilfully defrauded the exchequer of crores of rupees as the income-tax which would have been payable to it after payment of arrears to us, and could have been charged to us; has been avoided by the Corporation for 26 years!
Importantly, the amounts of wage revision arrears payable to all of us have not been shown in the Balance Sheet of the Corporation at all, as liabilities. So the Balance Sheet and Financial Statements are in fact, erroneous. This is a serious lapse on the Corporation's and the Government's part as the Corporation has been listed on the stock exchange. Even the sister concerns of the Corporation, like the 4 general insurance companies, LIC Mutual Funds and LIC Housing Finance follow the same route of repudiation citing the corresponding clause in their respective wage revision charters. If this isn't a financial fraud (read scam!) of huge ramifications, (with potentially serious repercussions in future), what is?
In your capacity as the Head of State, I request you to kindly urge the Corporation to immediately give you answers with all the details of the 21 questions that I had put forth to it, through my RTI appeal in 2011.
I am including the same as a post-script here, alongwith an extract of the Hon'ble Supreme Court's judgment.
I request you to direct the Corporation to pay all my dues as well as those of others, immediately with compound interest till date.
Kindly do the needful at the earliest and oblige.
Yours sincerely,
Mrs. Priya Ramesh Swaminathan
P.S. The Government could just take the advice of its esteemed legal advisors and immediately sort out this long-outstanding issue to avoid any questions by LIC's investors in future.
My Blog:
L.I.C of India betrays its resigning employees’ Good Faith!
Shocking but true!
L.I.C of India betrays its resigning employees’ Good Faith!
It repudiates Arrears’ payment and difference in Retirement dues to its resigning employees.
The Life Insurance Corporation of India, the number one life insurer in the whole world, has not paid arrears of wage payments and arrears of difference payable under Statutory retirement benefits like Provident Fund and Gratuity, due to its resigning employees; since the 1st of August 1997, as revealed by answers to my RTI application. Revision of the wage bill in the Corporation is done after a period of every five years, but the notification is invariably delayed and the arrears are always paid after a gap of three years after they are actually due.
The Board of Directors of LIC of India has taken the decision to repudiate the arrears and sent it to the Finance Ministry for approval, though it is a purely administrative decision and not a policy decision. Only policy decisions involving public interest need to be referred to the Finance Ministry. The decision of the Finance Ministry also needs to be analyzed as to why it approved the Corporation’s decisions without due consideration of their legality and Court Judgments on the issue.
The Corporation has adopted a strategy of depriving its voluntarily resigning employees, that is those who are retiring before twenty years of service, of their legitimate dues by simply resorting to announcement of the notification after inclusion of a clause in a Gazette notified by the Finance Ministry of India, that such employees will not be eligible for payment of arrears. This effectively means that even if a resigning employee has been in service, that is, on roll of the Corporation on the date from which the arrears were effective, he/she will not be eligible to get arrears’ payment. This is illegal as wages are rights of an employee, according to our Indian Constitution and Labor Laws.
For instance, I had resigned after 18.5 years of service on 2nd July 2010 and the notification for payment of arrears due from 1st August 2007 was announced on 11th October, 2010. Legally, I was entitled to the arrears of difference in my wages from 1st August 2007 to 2nd July 2010 but it was denied on the basis of this Gazette and subsequent Circular’s notification by the Corporation.
Similarly, the Provident Fund and Gratuity being Statutory retirement benefits, their difference will also have to be paid as per the revised, enhanced wages. All the allowances, perks, etc. would also have to be calculated accordingly and the difference would have to be paid to that resigning employee.
The Corporation wrongly differentiates between the two classes of voluntarily resigning employees as those who have completed 20 years of service and those who have resigned before completing 20 years of service. The first class is entitled to the Wage Revision Arrears’ Payments and the second class isn’t entitled to it! Since the wage revisions were announced for all the employees of the Corporation, as a class, the Corporation should not deny the benefits to the resigning employees.
Besides, the Minutes of the Corporation’s Board Meeting with points regarding recommendations made to the Finance Ministry, for repudiation of arrears and retirement benefits; have not been given to me as they are not available with the Corporation! There is also no rationale on record; of this decision by the Corporation, as revealed by the replies received from the Corporation, in response to the RTI Application made by me; to L.I.C of India.
The Corporation has also replied that the Central Government takes this decision to repudiate arrears’ payments and hence it has repudiated arrears’ and other allied retirement benefits. In fact, it is the Managing Board of Directors of LIC of India, which takes this decision.
LIC of India has 115 Divisional Offices, 8 Zonal Offices, 9 Audit Centres, MDC and Central Office, as per the RTI replies. The total number of resigning employees whose arrears have been repudiated, since 1997 will be in thousands, and the total repudiated amount since 1997 will surely amount to crores of rupees.
The Corporation has refused to answer my RTI queries for details regarding the names, addresses, phone numbers and number of employees who have been denied the arrears payments and difference in retirement and other benefits due to them, as also the actual amount repudiated. The Central Office has given a list of 40 resigning employees, for 2010; and given an affidavit dated 4th April, 2014, that no other information apart from that given to me in response to my RTI queries, is on its records.
Interestingly, it refuses to part with this vital information on the grounds that it does not have this information in a centralized form in its Central Office. This is not true as all the information is sent by all the subsidiary offices of the Corporation to its Central Corporate Office in Mumbai regularly on a monthly basis. The Corporation’s Central Office compiles, consolidates and prepares the Final Trial Balance, Balance sheet and other Accounting Statements on a monthly, quarterly and yearly basis and annually presents the same in the Parliament as it is a Public Sector Organization.
The Central Office server in its I.T. Department has the entire record of all the employees, (in the form of ‘Employee Masters’) of the Corporation and the details of all the resigning employees of the Corporation are updated as and when they retire from service.
The Corporation has a highly organized and computerized set-up and all its records are computerized, hence it is hard to believe that it cannot reply to those queries in my RTI Application which pertain to information about such employees who have been short-changed by it; and the mind-boggling amounts involved.
The amounts repudiated haven’t even been accounted for, by the LIC of India in its books of accounts. Had these arrears payments been made, the Income-tax against these payments would have been sent to the Income-Tax Department. Thus this action of LIC of India has even led to a revenue loss to the Central Government exchequer. The Balance Sheet of LIC of India, a reputed Public Sector organization, will also not reflect the correct picture of its financial status.
Interestingly, the Gazette notifications G.S.R. 824 (E), 825 (E), 826 (E), 2470 (E), issued by the Ministry of Finance, dated 8th October, 2010; contain a point in their Explanatory Memorandum stating: “It is certified that no employee of the Life Insurance Corporation of India is likely to be affected adversely by the notification being given retrospective effect.”
Besides, the Supreme Court has already passed a judgment asking the Corporation to pay such arrears to retired employees, in its 2008 judgment. Thus, wasn’t the Corporation guilty of Contempt of Court, if it still persisted in referring to the Finance Ministry for approval, subsequent Gazette notification with the same clause 3 1) b) regarding repudiation of arrears (send proviso of Para 3 of the Notification dated 21st December 2005 is struck sown being ultra vires to the extent it deprives the petitioner and other similarly situated persons to get the benefit of revised pay scale with effect from 1st August 2002 after applying the principle of severability. Supreme Court's decision- Petitioner VS GIC) and then issuing an official Circular dated 11th October, 2010?
The evasive and lackadaisical response of the Corporation shows that it lacks transparency in its dealings, its records are not maintained properly; it does not follow standard accounting procedures and fair HR practices.
The Corporation is a trustee of trillions of public money. To its credit, it has been regularly making Claim payments to the beneficiaries of its insurance policies, and has the lowest ratio of claims repudiated, in the whole world. Why can’t it play fair with its resigning employees and pay them their dues, gracefully? Is it too much to ask for?
Hence I request all those employees who have resigned from the Public Sector Insurance companies (LIC, GICs and LICHFL) and not been paid arrears and other retirement benefits and allied dues, to come forward, send their names, phone numbers, e-mail ids, addresses and employment particulars (in these companies), etc. to me; so that we can collectively fight for justice. You may post your comments and details online on this blog.
I have also started a new thread of discussion- 'LIC of India repudiates wage arrears' payment'; on the website www.lawyersclubindia.com/Labour and Service law/Service. You may also post your feedback there.
Mrs. Priya Ramesh Swaminathan
The copyright of this write-up is with Mrs. Priya Ramesh Swaminathan.
SUNDAY 11 MAY 2014
My R.T.I. queries to L.I.C. of India
1. What is the official reason, because of which my arrears payment and difference in retirement benefits were repudiated during Wage Revision payment in the latest Wage Revision Charter dated 11th October, 2010?
2. Kindly provide me a copy of the gazette and official notification, along with information about which specific provisions of the gazette and official notification justify or state that I should not be given the arrears due w.e.f August 2007?
3. Please furnish me a copy of Names, Addresses, Telephone/Mobile nos., Branch Nos., Branch addresses, D.O. Nos. and D.O. addresses of all the employees of LIC of India, who were denied arrears’ payment under the Charter dated 11th October, 2010.
4. Were any of the above employees paid the arrears amount by LIC of India? If so, why, when and by whom? Names and other details as in (3) above, to be furnished. Documentary proof to be provided by LIC of India.
5. Is there any case filed by any such employee, whose arrears’ payment was repudiated by LIC of India, against LIC of India; in respect of any such Charter. If so, details about the case—Name of the appellant, B.O. and D.O. addresses, residential and official address, telephone/mobile no., Charter Date (in respect of any such charter, including the latest one) and copy of the judgement.
6. What was the outcome of the case as in (5) above? Documentary proof to be provided by the LIC of India.
7. No. of resigning employees all over India and the total amount repudiated (of arrears’ payment by LIC of India) with bifurcation in respect of each such employee; in the Charter dated 11th October, 2010 applicable w.e.f August 2007.
8. No. of employees, names, addresses, telephone/mobile nos. and amounts repudiated respectively (in respect of each one) under all the Charters of Wage Revisions (Previous 5 Charters, excluding the latest one) and their Branch Nos., Addresses of Branches, D.O. Nos., Addresses of D.O.s also to be provided.
9. Since which year or which Charter has LIC of India started repudiating arrears’ payment legitimately due, to its resigning employees; and why?
10. Details of the exact legal provisions and clauses on the bases of which LIC of India has arrived at its premise of refusing to pay Arrears’ payment and subsequent difference in retirement benefits to its resigning employees.
11. Who takes this crucial decision to repudiate arrears’ payment to the employees? The Government of India or LIC of India? Details to be provided with documentary proof.
12. The total no. of transactions effected under my S.R. No. 441595 from 1st August, 2007 to 2nd July, 2010, the last date of my service in LIC of India.
13. Copy of the note or letter put up to the Chairman, LIC of India for the final decision regarding my resignation.
14. Copy of the final approval of my resignation by LIC of India.
15. Documents pertaining to the Board Meetings of LIC of India wherein this resolution to repudiate arrears of resigning employees; has been taken. Kindly provide Minutes of the Meetings with signatures of all the attending members.
16. With reference to my representation letters dated 20-10-2010 (addressed to the Executive Director, Personnel, LIC of India) and 20-11-2010 (addressed to the Chairman, LIC of India), sent through Speed Post and subsequent e-mails dated 22-10-10, 26-10-10, 01-11-10, 08-11-10, 13-11-10, 16-11-10, 20-11-10, 27-11-10, 04-12-2010, 06-12-2010, 09-12-2010, 13-12-2010, 21-12-2010, 24-12-2010, 25-12-2010, 30-12-2010, 04-01-2011, 13-01-2011, 17-01-2011, 28-01-2011, 31-01-2011, 08-02-2011; why were they not replied to immediately? Why was there an inordinate delay of 8 months for a single line unsatisfactory reply vide letter dated 14-03-2011, received by me on 07-06-2011, that too replied to; not by the addressees of my letters, but by the lower office (Pune Divisional Office No.1)? Kindly provide an explanation letter.
17. Copy of the LIC of India, Staff Regulations, 1960 and subsequent modifications/amendments therein, if any.
18. Names, phone numbers and official addresses of the current Chairman, Officiating Chairman, Executive Directors, Managing Directors and Sr. Divisional Manager of Pune Divisional Office 1; LIC of India
19. Please provide a list of applicants for Wage Revision arrears’ payments in respect of the Charter dated 11th October, 2010 during the last 16 months, giving names, dates of application and dates on which replies were issued by LIC of India.
20. What are the factors due to which the Wage Revision Charter is delayed inordinately, every time that it is legitimately due?
21. a) Does the LIC of India, Staff Regulations, 1960 and subsequent modifications/amendments therein, if any, contain any clause wherein it is mentioned that arrears payment after Wage Revision due to a Charter notification, may be denied to an employee on roll of the LIC of India in the period for which the Charter has been announced?
b) If so, kindly point out the requisite provision or clause with adequate, satisfactory explanation/rationale.
c) Does this denial of arrears payment and difference in retirement benefits, agree in principle, with the labour laws applicable in India?
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The copyright of this write-up is with Mrs. Priya Ramesh Swaminathan.
TUESDAY 30 DECEMBER 2014
LIC Gazette Notification 2010 - Class II employees (Development Officers)
The same clause that applies for Class 1 Officers, which states that resigning employees are not eligible for arrears' payment, applies to Class II and Class III and IV of LIC and GIC employees too.
GIC comprises of 4 companies, New India Assurance, United India Assurance, National Insurance and Oriental Insurance Company. Besides, LICMF, GICHFL & LICHFL's employees would have also been affected by the same clause, which has been declared as ultra-vires by the Supreme Court in 2007. One can just imagine how many ex-employees, all together, in all these Life and Non-Life Public Sector insurance companies have been illegally deprived of their hard-earned dues! LIC has not divulged details regarding total number of ex-employees throughout the Corporation, since 1997, whose arrears have been repudiated and the amounts repudiated against each of their accounts, etc. in reply to my RTI application.
As even the Statutory Retirement benefits like Provident Fund and Gratuity would have been eligible for difference in payment as per revised rates, this repudiation, running to the tune of billions of rupees, is a scam of huge ramifications.
It is therefore very surprising that this issue has not been highlighted or debated about, anywhere in any print or electronic media, any time in the past, as per my knowledge, since 1997, when the first batch of payments to resigning ex-employees was repudiated.
I had sent the report contained in my first blog post to the Press Trust of India (Mumbai, Delhi, Kolkata, Chennai), The Times of India (Mumbai, Delhi, Kolkata, Chennai), Open Magazine, Mumbai Mirror (Their inbox was full, hence the message appeared as 'not delivered') and Youth Ki Aawaz portal. Not a single one of them replied back or acknowledged my e-mail, or got back to me for information, barring the Youth Ki Aawaz portal which also developed cold feet and refused to publish my report.
Salient rulings by the Supreme Court regarding the Wage Revision Charter
Consider this extract from a Supreme Court judgment, in 2007:
SC - "Proviso of Para 3 is struck sown ultra vires"
K. S. Raina. - ------------Petitioner.
Versus
Union of India and others. --------Respondents.
Coram:
The Hon’ble Mr. Justice Rajiv Sharma, Judge.
Whether approved for reporting?* Yes.
For the Petitioner: Ms. Ranjana Parmar, Advocate.
For Respondent No. 1: Ms. Shilpa Sood,
Central Government Counsel.
For Respondents No. 2 & 3: Mr. Ashwani Sharma, Advocate.
Rajiv Sharma, J.
It has come in the supplementary affidavit filed on behalf of respondent No. 2 that the wage revision of the employees of the nationalized insurance companies follows a periodicity of five years, i.e. 1st August 1987, 1st August 1992, 1st August 1997 and 1st August 2002. Thus, it is evident that in normal circumstances wage revision should have taken place in the year 2002 instead of 2005.
Classification made by the employer on the basis of seeking premature retirement on the basis of two sets of retirement schemes is not sustainable being irrational and discriminatory.
The petitioner has a constitutional right to get his pay including the revision in the pay scale and it is settled law by law the fundamental rights can neither be waived off nor bartered away.
The action of the respondents is not supported by any rational basis or intelligible differentia.
In the present case the petitioner was in fact in employment as on 1st August 2002, the date from which the Notification (Annexure P-4) dated 21st December 2005 has been made applicable.
Consequently, in view of the observations made above, send proviso of Para 3 of the Notification dated 21st December 2005 is struck sown being ultra vires to the extent it deprives the petitioner and other similarly situated persons to get the benefit of revised pay scale with effect from 1st August 2002 after applying the principle of severability.
According, the petition is allowed. The petitioner is held entitled to get the revised pay scale corresponding to his post he was occupying as on 1st August 2002 till 15th March 2004. The respondents are directed to work out the arrears etc. within six weeks from today.
December 3, 2007 (Rajiv Sharma), J.
****************************************************************************************************************************
Source: Supreme Court and High Court judgments relating to Insurance.
Extract
An order passed by the Hon'ble Supreme Court in Civil Appeal No. 1289 of 2007 - Life Insurance Corporation of India and others v. Retirement L.I.C. Officers Association and others, decided on 12.2.2008
Revision of scales of pay as also other allowances is technical in nature. When a benefit is extended to a group of employees the effect of such benefit, if otherwise comes within the purview thereof must be held to be applicable to other groups of employees also. An employee is entitled to gratuity. It is not a bounty. It is payable on successful tenure of service. Regulation 77 provides as to how the amount of gratuity is to be calculated. Regulation 51 provides for a rule of measurement. Only because it employed the word “permanent basic pay”, the same will not itself lead to the conclusion that once an employee has retired, he would not be entitled to any revision of the amount of gratuity.
26. The Chairman of the Corporation has himself given a retrospective effect to revision in scales of pay. Such a retrospective effect has also been given so as to benefit a class of employees. The employees, irrespective of the fact whether they had superannuated or not, were given the benefit of arrears of pay from Ist August, 1993. By reason of grant of such benefit both to serving employees as also the superannuated employees, both the class of employees became entitled thereto as of right. If by reason thereof, even a retired employee, as on the date of retirement, became entitled to the benefit of the revised scale of pay, the same for all intent and purpose must be taken to be the permanent basic pay, apart from other allowances, if any, which are required to be taken into consideration for the purpose of computation of the amount of gratuity.”
Later, the Hon'ble Supreme Court found that fixation of cut off date by the Chairman of the Corporation is beyond the powers conferred upon him by the Statute.
In view of the aforesaid judgment, the present writ petition is allowed in the same terms as ordered by the Hon'ble Supreme Court, with directions to the respondents to grant the consequential benefits to the petitioners within a period of three months.
04-07-2008
ds
(HEMANT GUPTA)
JUDGE
