IN THE HIGH COURT OF JUDICATURE AT MADRAS Dated : 12-4-2011 Coram The Honourable Mr.Justice N.PAUL VASANTHAKUMAR W.P.No.4065 of 2009 M.P.No.1 of 2009 & 1 of 2011 The President, rep.Chennai Petroleum Employee's Union, Manali, Chennai- 600 068. ... Petitioner Vs. The General Manager (H.R.) Chennai Petroleum Corporation Ltd., Manali, Chennai 600 068. ... Respondent Prayer: Petition filed under Article 226 of Constitution of India, seeking a Writ of Certiorari calling for the records pertaining to the respondent's proceedings referred vide Ref.HRD.02.057 dated 18.12.2008 relating to the performance of appraisal procedure followed by the management and to quash the same. For Petitioner: Mr.V.Prakash, Senior Counsel, for Mrs.Ramapriya Gopalakrishnan For Respondent: Mr.Sanjay Mohan for M/s.Ramasubramiam & Associates O R D E R
This writ petition is filed by the Chennai Petroleum Employee’s Union against the respondent management/Chennai Petroleum Corporation Ltd., to quash the order passed by the respondent dated 18.12.2008 relating to the performance appraisal procedure followed by the respondent management.
2. The brief facts necessary for disposal of the writ petition are as follows:
(a) The petitioner Union entered into a settlement with the respondent company, a Government of India Undertaking on 5.2.2009 under section 18(1) read with section 2(p) of the Industrial Disputes Act, 1947, relating to various aspects in the process of promotion within and from the non-supervisory cadre. Annexure-B of the memorandum of settlement explains the criteria for promotion from non-supervisory cadre to supervisory cadre.
(b) According to the settlement, for performance appraisal 40 marks are awarded. The respondent is keeping secrecy in awarding appraisal marks and no transparency is followed. The said conduct creates suspicion among the cadre employees and there is no uniformity in awarding appraisal marks, which is discriminatory, depriving the rights of the employees as well as the said procedure is in violation of the principles of natural justice. According to the Union, many of the employees suffered due to the said action of the respondent and the procedure adopted in violation of the conditions contained in the settlement dated 5.2.2009 which is binding not only on the employees, but also on the respondent management.
(c) According to the petitioner, recently a new guideline was issued by the respondent regarding performance appraisal and review. The said guideline, particularly clause 5, part 3 is the offending portion, which states that the Reviewing Officer will counsel the Appraisee in the presence of the Reporting Officer immediately after the Reporting Officer fills up Part-I and II. During counselling, the Reviewing Officer shall counsel the Appraisee on his performance and areas of improvement, but shall not disclose the ratings. The Appraisee’s response shall be recorded by the Reviewing Officer in the appropriate column. The Appraisee is required to sign the said performance recorded. The said procedure according to the petitioner is contrary to the judgment of the Supreme Court reported in (2008) 8 SCC 725 (Dev Dutt v. Union of India).
(d) Clause 8 also states that the appraisal at the sectional and departmental level (grade wise) should follow a cure pattern with maximum of 20% being rated as “excellent”; 40% as “good”; 30% as “fair” and 10% as “poor”. Even after moderation, the percentages are found to exceed the prescribed norms. The Reporting Officer/Reviewing Officer/Accepting Officer shall rank all the appraisees grade-wise. The said procedure adopted is arbitrary with ulterior motive to sub-serve the employees and to retain the possibility of bias. Hence the writ petition is filed challenging the order passed by the respondent dated 18.12.2008, which is said to be contrary to the settlement and not in tune with the judgment of the Supreme Court.
(e) It is also urged in the writ petition that the procedure adopted is not only violative of the settlement clauses but also violative of Articles 14, 16(1) and 310(2) of the Constitution of India. Arbitrariness and bias can be exercised which will deprive the rights of the members of the petitioner Union.
3. The writ petition is opposed by the respondent by filing counter affidavit stating that the respondent is a Public Sector Company engaged in refining crude oil and manufacture of petroleum products like Petrol, diesel, cooking gas, etc. The petitioner Union and the respondent Corporation entered into a settlement under Section 18(1) read with Section 2(p) of the Industrial Disputes Act, 1947 on 5.2.2008, which exclusively deals with promotion policy for non-supervisory employees. The purpose of the settlement is to maintain and strengthen orderly, harmonious, cordial, effective and lasting industrial relations and co-operation between the Company and the workmen so as to promote the interest of employees and the object of the Company to create job satisfaction by making maximum use of existing and giving training for new skills to co-operate and create healthy industrial relations and to maintain discipline in the labour force. The performance appraisal and review which are followed is transparent which contain three tire system for review and appraisal with the object of minimising subjective factors. The steps of performance appraisal at the first level of Reporting Officer followed by Reviewing Officer and thereafter by the Department Head, which is a multilevel system containing inbuilt safeguards. A curve pattern is followed for the rank of performance appraisal in non-supervisory employees, which is in tune with the office memorandum issued by the Department of Public Enterprises, Government of India, dated 26.11.2008. The said memorandum was issued on the basis of the recommendation by the Pay Revision Committee. The petitioner Union is not aggrieved in any manner as there is total transparency in the procedure followed. The said procedure is followed even in the Officers’ level. The criteria for promotion of employees from non-supervisory cadre to supervisory cadre is given in Annexure-B which provides for allocation of marks based on performance ratings of the employees, which is as follows:
S.No.
Performance ratings
Weightage of marks
i.
Greater than or equal to 90
40 marks
ii.
Less than or equal to 89 and greater than 70
34 marks
iii.
Less than or equal to 69 and greater than 40
25 marks
The criteria for promotion within the non-supervisory grades is as follows:
S.No.
Performance ratings
Weightage of marks
i.
Greater than or equal to 90
25 marks
ii.
Less than or equal to 89 and greater than 70
20 marks
iii.
Less than or equal to 69 and greater than 40
15 marks
The weightage for appraisal are based on average annual appraisal marks obtained during previous three years in the present grade. It is also stated that a three tire performance review and appraisal is followed viz., once the Reporting Officer appraises the performance of an employee, the Reviewing Officer, who is the higher authority gives summary rating and finally the department head as the Accepting Officer gives summary ratings. The management is following the promotion policy dated 5.2.2008 which provides a vacancy-cum-merit based promotions. There is no violation of settlement by the Corporation. The said procedure is followed from 2003. The performance appraisal format contains the guidelines for assessment. The system that the appraisals at the sectional and department level should follow a curve pattern with maximum of 20% being rated as ‘excellent’; 40% as ‘good’; 30% as ‘fair’; and 10% as ‘poor’. Similar pattern is being followed in the holding Company i.e, IOC limited. There is no violation of Article 14 and 16(1) or any clause contained in settlement dated 5.2.2008.
4. The learned Senior Counsel for the petitioner Union submitted that the performance appraisal having got a bearing on the promotion of the members of the Union, the Judgment of the Supreme Court reported in (2008) 8 SCC 725 (Dev Dutt v. Union of India) is bound to be followed by the respondent as any rating given during appraisal will make or mar the future of the employee in getting promotion.
5. The learned counsel for the respondent on the other hand submitted that the writ petition filed by the Union is not maintainable if any individual workman is affected by the procedure followed that workman alone can raise a dispute that too before the Labour Court and the same can be adjudicated. The learned counsel also submitted that the reply given to the Union cannot be challenged in this writ petition as no rights of the parties are determined by the impugned order much less the right of any workman is determined. The learned counsel also submitted that the Judgment of the Supreme Court cited above is only for recording Annual Confidential Report and the said judgment may not apply to the present matter now raised by the petitioner Union. The learned counsel therefore submitted that the writ petition is liable to be dismissed.
6. I have considered the rival submissions of the learned Senior Counsel appearing for the petitioner Union and the learned counsel appearing for the respondent.
7. The guidelines issued by the respondent Company regarding performance appraisal read as follows:
“1. This performance Review and Appraisal form is to assess the Performance of the Employees for the Calendar year. This form is to be filled by the Reporting Officer. It consists of five parts: Parts I, II, III, IV and V. Only Part-III (counselling) and Part-V (Training Profile & Plan) is open to the Appraisee, for recording his response to counselling.
2. Additional information about the Appraisee This will be filled in by Personnel Department and sent to the Reporting Officer. Any other relevant information, which is known to the Reporting Officer, may also be written by the Reporting Officer.
3. Part-I: Annual Performance Appraisal The Reporting Officer will assess the performance of the Appraisee against various attributes mentioned, on a 5 point scale, and mark “X” in the appropriate column against each attribute. The Reporting Officer will mark “X” in the box for “Honesty & Integrity”, if this attribute of the Appraisee is beyond doubt. If there is a doubt or suspicion, the item will be left blank and a separate confidential note will be recorded and sent to the Accepting Authority for follow up action.
4. Part-II: Performance highlights The Reporting Officer will write the performance highlights of the Appraisee under two heads i.e., Achievements and Contributions. The performance highlights in the Appraisees normal areas of work will be covered under “Achievements” and other contributions made by the Appraisee (other than routine assignments) will be covered under “Contributions”.
5. Part-III: Counselling The Reviewing Officer will counsel the Appraisee in the presence of the Reporting Officer, immediately after the Reporting Officer fills up Part-I and Part-II. During counselling the Reviewing Officer shall counsel the appraisee on his performance and areas of improvement but shall not disclose the ratings of the appraisee. This must be done without fail for all employees. The Appraisee’s response shall be recorded by the Reviewing Officer in the appropriate column. The Appraisee is required to sign in this part to indicate that he has been counselled on his performance.
6. Part-IV: Annual Appraisal The Reporting Officer will award his rating on the performance and Achievements & Contributions of the Appraisee, and also the summer rating of the Appraisee, based on the overall performance and effectiveness of the Appraisee in his present role. The Reviewing Officer and Accepting Officer will also award summary ratings for the Appraisee.
7. Part-V: Training Profile and Plan The Reporting Officer will record the training programs attended by the Appraisee in Calendar year and also write the suggested training needs for the Appraisee. This sheet will be detached by personnel department and forwarded to Training department for follow up action.
8. The Appraisals at the Sectional and Departmental level (Grade-wise) should follow a curve pattern with a maximum of 20% being rated as “Excellent”, 40% as “Good”, 30% as “Fair” and 10% as “Poor”. In case where even after such moderation, the percentages are found to exceed the prescribed norms, the Reporting Officer/ Reviewing Officer/Accepting Officer shall rank all the Appraisees, Grade-wise.
9. In the event of transfer of Appraisee, status change etc., this form form should be sent to the new Reporting Officer as applicable.”
8. From the counter affidavit as well as the guidelines extracted above it is evident that three tier system for review and appraisal is followed i.e, firstly by the Reporting Officer, secondly by the Reviewing Officer and thereafter by the Department Head. The said appraisal is in tune with the official memorandum issued by the department of Public Enterprises, Government of India dated 26.11.2008.
9. The contention of the petitioner that in each stage the employee should be heard or put on notice before performance appraisal, cannot be countenanced in view of the fact that only after the third stage the performance appraisal become conclusive and the same is taken into consideration for the grant of promotion. The process of promotion should be allowed to be finalised and in each and every stage the employee cannot be put on notice and if the same is permitted, the selection process will be hampered at every stage. The appraisee is informed of all his good points, and wherever he is lacking, he gives his views and thereafter only the same will be recorded. The appraisee also signs after all the boxes are filled up in his presence. It is also stated in the Counter affidavit that the management is not getting any kind of signatures of workman on empty forms and no protest is ever made by any employee. Hence the procedure adopted by the respondent cannot be held as illogical. If any of the employee is affected by the action of the respondent in not giving promotion after finalisation of the promotion, it is open to the employee concerned to raise his valid objection by approaching the Labour Court or appropriate forum and if any individual grievance is made, the respondent is bound to answer as to how the performance appraisal was made as it has got effect on the grant of promotion like recording of Annual Confidential Report. In the additional counter affidavit filed by the respondent dated 16.3.2011 it is admitted that appraisal ratings are used as one of the criteria for the purpose of promotion, besides ratings are used for the grant of Additional Personal Pay, Computer Advance, Performance Linked Incentive Payment, and Self-lease accommodation.
10. The Supreme Court in the decision reported in (2008) 8 SCC 725 (Dev Dutt v. Union of India) held that after recording ACR in the service register, the concerned employee should be put on notice and he should be given an opportunity to explain his position if he is not satisfied with the recording of ACR and non-communication of the same was treated as unfair and violative of the principles of natural justice. Therefore the respondent is bound to disclose the performance appraisal of each individual workman after the selection process was over and if an employee is not selected based on the performance appraisal or denied any benefit. Paragraphs 36 and 37 of the decision of the Supreme Court read as follows:
“36. ………. we are developing the principles of natural justice by holding that fairness and transparency in public administration requires that all entries (whether poor, fair, average, good or very good) in the annual confidential report of a public servant, whether in civil, judicial, police or any other State service (except the military), must be communicated to him within a reasonable period so that he can make a representation for its upgradation. This in our opinion is the correct legal position even though there may be no rule/G.O. requiring communication of the entry, or even if there is a rule/G.O. prohibiting it, because the principle of non-arbitrariness in State action as envisaged by Article 14 of the Constitution in our opinion requires such communication. Article 14 will override all rules or government orders.
37. We further hold that when the entry is communicated to him the public servant should have a right to make a representation against the entry to the authority concerned, and the authority concerned must decide the representation in a fair manner and within a reasonable period. We also hold that the representation must be decided by an authority higher than the one who gave the entry, otherwise the likelihood is that the representation will be summarily rejected without adequate consideration as it would be an appeal from Caesar to Caesar. All this would be conducive to fairness and transparency in public administration, and would result in fairness to public servants. The State must be a model employer, and must act fairly towards its employees. Only then would good governance be possible.”
11. Applying the underlying principles of the said decision to the facts of this case, I am of the view that the impugned order need not be quashed and the individual workman after finalisation of the selection and denial of promotion or any other benefit, can very well ask for the performance appraisal about him and if he is aggrieved, he can very well approach the appropriate forum to redress his grievance.
The writ petition is disposed of accordingly. No costs. Connected miscellaneous petitions are closed.
vr