The sole question which arises for consideration in this appeal is whether the respondent, who is an employee of the appellant, can claim damages from the appellant on account of the injury suffered by him during the course of employment when he was already received the benefit under the provision of the Employees State Insurance Act 1948 (hereinafter referred to as the ‘ESI Act’.
There are only three provisions of the ESI which are relevant for the present case.
Section 2 (8): Employment injury means perennial injury to an occupational disease arising out of and in the course of his Employment, being an insurable employment whether the accident occurs or the occupational diseases are contracted within or outside the territorial limits of India.
Section 53: Bar against receiving or recovery of compensation for damages under any other law:– An insured person or his dependents shall not be entitled to receive or recover whether from the employer of the insured person or from any other person, any compensation or damages under the Workmen’s Compensation Act, 1923 (8 of 1923) of any other law for the time being in force or otherwise, in respect of an employment injury sustained by the insured person as an employee under this Act.
Section 61: Bar of benefits under other enactments: When a person is entitled to any of the benefits provided by this Act, he shall not be entitled to receive any similar benefit admissible under the provisions of any other enactment.
Section 53 disentitles an employee who has suffered an employment injury from receiving compensation or damages under the Workmen’s Compensation Act or any other law for the time being in force or otherwise. The use of the expression “or Otherwise” would clearly indicate that this section is not limited to ousting the relief claimed only under any status but the workings of the section are such that an insured person would not be entitled to make a claim in Torts which has the force of law under the ESI Act. Even though the ESI Act is a beneficial legislation the Legislature had through it fit to prohibit an insured person from receiving or recovering compensation or damages under any other law, including Torts, in cases where the injury had been sustain by him is an employment injury.
The ESI Act has been enacted to provide certain benefits to the case of sickness, maternity and employment injury and make provisions in respect thereof. Under this Act, the contribution is made not only by the employee but also by the employer. The claim by the employer against the employer where the relationship of the employer and employee exists was meant to be governed by the ESI Act alone. It is precisely for this reason that the Madras High Court in Mangalamma’s case had observed that the object of Section 53 of the ESI Act was to save the employer from facing more than one claim in relation to the same accident. This, in the apex court opinion, is the correct reading of the said provision. This being so the claim of the ESI Act, the trial court was right in dismissing the application under Order 33 Rule 1 of the Code of Civil Procedure.
The Bombay Shops & Establishments Act: According to The Bombay Shops & Establishments Act, which provides in section 65 of the act that no employee shall work in any establishment, nor shall any employer knowingly permit an employee to extend services to another establishment on an off day as per the Act.
The Delhi Shops and Establishments Act: The Delhi Shops and Establishments Act states that no person shall work for the business of an establishment or two or more establishments or an establishment and a factory for a period in excess of which he may lawfully be employed under the act.
Industrial Employment (Standing Orders) Central Rules: Under section 8 of schedule I-B the Industrial Employment (Standing Orders) Central Rules, 1946 states that a workman cannot by doing dual employment work against the interest of an industrial establishment.
It is to be noted that the term dual/double employment in the shops and Establishment act is different from what is stated in the Factories Act. As per the provisions of the act, there is a direct obligation on the employee not to work on off days anywhere and puts an obligation on the employer not to permit such employment. The intent behind all the employment laws is the same even though the interpretations are different.
Moonlight clauses: Moonlighting clause is an agreement of service which contains negative covenants restricting the employee from working elsewhere during/after the period covered by the agreement. It is used by employers as a measure for protecting the company’s interest and for ensuring that employees provide their full time and energy to their current job. It is a clause that contains a negative covenant putting restrictions on the double employment of an employee. Thus, it restricts an employee from taking any other job while being employed by another employer. Moonlighting means holding another job during the working hours of employment. Moonlight clauses are added to the employment agreement with the aim of ensuring efficiency and focus of employees at their current employment. The condition for the moonlight clause is that it must be included and signed with the free consent of both the employer and employee. In India a moonlight clause is enforceable and it can be enforced under the law whenever necessary.
In an employment agreement in order to avoid dual employment, the employer should mention dual employment being a ground for termination of employment. This way he can ensure that dual employment is against his terms of employment.
Even though the Indian labour laws are silent on the aspect of dual employment, dual employment is considered a valid ground for termination of employment. Employers can specify this on the employment agreement. Dual employment being an act which affects the wellbeing of individuals and organization the laws and courts accepts the actions taken against dual employment. The courts did not hold that termination on the ground of dual employment is a violation of the worker’s right. To tackle dual employment companies, introduce moonlight clauses in their employment agreements. HR policies of the organizations should also establish a stand on dual employment by making a proper framework. Apart from legislation, what employers can do is to include moonlight clauses. The term itself means doing another job during the hours of principal employment.
Thus the Indian employment laws and regulations have the same intention in the case of dual employment. Man being a social animal requires family, social life, and rest, he is not a machine. Thus adequate rest and leisure time is necessary for the well-being of the individual and the society. The provisions of Indian employment laws are against dual employment.