In the case of any non-employment dispute, if the Labor Court finds the orders of termination illegal and unsustainable, it can set aside it and order reinstatement with back wages, continuity of services and all other attendant benefits from the date of dismissal till the date of reinstatement. Some times, depending on the nature of misconduct for which dismissal was ordered like unauthorised absence or procedural lapses in the disciplinary proceedings, the Court may order reinstatement even without back wages or with part back wages as it deems fit. Similarly, if the management establishes a good case for its decision, the Court may uphold the orders of dismissal or discharge and dismiss the claim of the workman. Therefore, the outcome of the award may be anything depending on the gravity of the charges alleged against the workman, the correctness of the entire disciplinary proceedings, the gainful employment of the workman after his dismissal or discharge etc. Here back wages would mean the normal wages receivable by the workman had he not been dismissed from service minus the statutory deductions.
When an out-of-Court settlement is reached, back wages would mean the gross wages last drawn.