Facing Forced Resignation While Pregnant: Can I Seek Legal Action for Compensation?

Hi All, I'm working in a Pvt. Ltd. Company for the last 8 years. Now my company is going to shut down. The company is taking resignation letters from employees, offering three months CTC, and threatening to terminate employees if they do not resign. In my case, I am pregnant. I refused to resign and asked them to give me 6 months' compensation for my pregnancy, but they refused and forced me to resign. I resigned because I was stressed. Now, can I file a case against the company for forced resignation? Is there any chance to get compensation for my pregnancy duration since I cannot get any job in the market due to pregnancy?

Understanding Maternity Benefits Under the Maternity Benefit Act, 1961

In today's era, an employer is misconceived if he thinks that he can avoid paying maternity benefits admissible under the Maternity Benefit Act, 1961. The Act clearly provides authorities under the Act who can enforce the payment of benefits. All an aggrieved woman has to do is make a representation to an inspector appointed under the Act for the withdrawal of benefits admissible under the Act. An employer cannot dismiss or discharge a pregnant woman merely because of her absence under Section 12 of the Act. If he does so, he can be prosecuted, and the criminal court can punish him with imprisonment of not less than three months under Section 21 of the Act. Please refer to the Municipal Corporation of Delhi case decided by the Apex Court in 2000 in this regard.

Steps to Take if Maternity Benefits Are Denied

Even if one finds laxity on the part of the inspector to get the dues, file an application under the RTI Act, 2005, before the CPIO of the labor department seeking information about the status of the representation given by her and what steps were taken by him on it as regards lodging of criminal prosecution against the erring employer or manager. It may be noted that under Section 2(f) of the RTI Act, information can be obtained from a private body if the information can be accessed by a public authority. Since the inspector is a public authority and is duty-bound under the Act to ensure compliance with the provisions under the Act, he can access information from a private employer, and so the aggrieved woman can obtain information from him about the status of payment of maternity benefits to her. Unfortunately, if the employer has dismissed or terminated her, what steps the inspector has taken to nullify it.

Thank you so much for your contribution with the case law. However, the given case is not about dismissal or termination but rather a resignation. It is very difficult to prove now that the said resignation was forcibly taken.

Discussion on Forced Resignation

We should academically discuss whether there is a chance to prove that the resignation was taken forcibly.

Regards

Legal Remedies for Aggrieved Women in Employment Disputes

Two remedies are available to the aggrieved woman. If she was a workman, then her forced resignation is covered under "otherwise terminates" of section 2A of the ID Act and can be challenged before the labor court. Otherwise, she can challenge before the civil court on the ground of coercion. Besides, she cannot be denied maternity benefits, which must be paid in advance to some extent. It should be remembered that no one serves in such disputes on a platter. Everything is decided based on evidence.

Closure of Establishment and Employee Rights

When a company is going to be locked out, it is important to ensure that the formalities connected with the closure of the establishment, as per Section 25FF of the Industrial Disputes Act, are followed. If your establishment has not employed more than 100 employees during the last 12 months, they can close down the operations by informing the employees of the closure 2 months in advance, marking a copy to the Labour Officer, and paying retrenchment compensation as per Section 25F, which will be equal to 15 days' pay for each year of service. In case you have less than 50 employees, intimation to the Labour Department is also not required, but only a report of closure would be sufficient.

The Maternity Benefits Act does not prohibit the closure of an establishment due to the reason that the establishment has a pregnant employee. Therefore, in the context of closure, I don’t find any merit in your demand for 6 months' salary as compensation. At the same time, your demand for payment of 4 months’ salary as retrenchment compensation (calculated at the rate of 15 days' salary for every completed year of service) and 2 months' notice or salary for 2 months in lieu of notice will be justified.

Regards,
Madhu.T.K

It may be remembered that the liability of an employer for damages due to illegal deemed termination, accrued in favor of the aggrieved woman, cannot be curtailed merely because of the future closure of the company because the cause of action had already arisen. Similarly, dues admissible under the Maternity Benefit Act cannot be denied because of the later closure of the company. I am trying to know her designation to see whether she is covered under the ID Act.

Understanding Your Rights Under the ID Act

Though apparently your organization falls under the ID Act, you do not appear to be a workman. Therefore, you are out of the purview of this Act. The remedy of filing a suit for declaration, recovery of damages, and consequential recovery of maternity benefits may be pursued through the civil court.

Grounds for a Civil Suit

The grounds for a civil suit should be the nullity of the offer of resignation due to coercion by the employer, in terms of the provisions of the Contract Act. Forced resignation may not have a remedy under the Shops and Establishment Act in view of settled decisions.

I think litigation always helps. But the more pressing question is: are you prepared to invest in that unless you are eligible to be helped free of cost by the 'Legal Services Authority'? Further, presuming that you win the legal battle, apart from the maternity leave of 84 days with pay, you may get only Rs 2500/- (two thousand and five hundred only) as a medical bonus if no prenatal confinement and postnatal care are provided by the employer free of charge.

In my view, whatever Mr. T K Madhu has opined appears to be logical and legally viable. The fact remains that when a company has offered compensation equal to 3 months CTC, its liability under the Labor Laws comes to an end.

Maternity Benefits Act of 1961

As regards the Maternity Benefits Act of 1961, the benefits will accrue 6 weeks pre-natal and 6 weeks post-natal, which have not taken place as of date. Ms. Manushi is expecting a delivery, but the probable date is not identified. In such a case, considering the designation and her status, it would be prudent enough to accept the offer and lodge the case in the civil court or appropriate authority for further benefits such as Gratuity. Also, PF dues (if deducted from salary earlier as per the Act).

Understanding Maternity Benefits During Company Closure

It is not the medical bonus of Rs. 3500 (not Rs. 2500) that is the issue, but rather the payment of salary for 84 days when childbirth occurs after the company has closed down, following all legal steps and fulfilling all requirements. I do not think the appropriate authority would ask the company to postpone its closure just to accommodate a pregnant employee.

More importantly, a company will not decide to close down its operations just because it has a pregnant employee who would demand maternity benefits. There can be a dispute if the maternity benefit period begins now and the company's closure formalities are yet to be completed. This is particularly true if the expected date of delivery is just 6 weeks away, as 6 weeks is the maximum leave an employee can avail before the expected date of delivery.

Regards,
Madhu.T.K

If you do not do anything, you will remain in the same situation as today. If you fight for your rights and win your battle, you will gain mental satisfaction. Put your achievements on this site so that similarly aggrieved individuals may gain confidence, acting as a deterrent for citizens who believe in infringing upon others' rights. Remember, the Trade Union Act was not achieved overnight. Nowadays, courts take a stringent view and impose exemplary costs in many cases.

I do not dispute that you should fight for your rights. But before that, just answer my apprehension (yes, it is an apprehension only): will an employer close down the unit just because one lady employee is waiting to demand maternity leave?

If you take the verdicts by courts, we will get different rulings, both against and in favor of workmen. But at the end of the day, we all will rest on one thing: without a canvas, you cannot draw anything. After having made a Trade Union Act or having united for the workers, what do the workers get when the ID Act itself is amended (or going to be amended), giving employers the authority to retrench the workers or close down the unit without taking any approval from the government? What is welfare when those who have been enjoying the benefits of ESI and Provident Fund Pension are asked to forget about these social welfare schemes and go for insurance, which will never give coverage to existing diseases and aged parents even after paying huge premiums?

Regards,
Madhu.T.K

Legal Recourse for Forced Resignation and Compensation

Through the civil suit, if the forced resignation is set aside after passing a decree, damages are also awarded, which may vary from 9 months to three years of salary. Besides, maternity benefits are also admissible. Since the cause of action has already arisen, the closure of the unit is immaterial because the issue is not the closure of the unit before the court.

Further, what is the policy of the government of the day may have to pass the test on the floor of parliament. Who knows how things shape up? But under the present ID Act, still, the rights of the workman are protected to a large extent. However, there are persons who do not like to facilitate workmen to enjoy their rights, and litigation is becoming a costlier venture. Please read Justice D.A. Desai's judgments.

Thank you so much, Octavius, for sharing the latest judgment of the Madras HC, and that too on a current topic. This judgment would be a very fitting case if there is a termination of a pregnant woman.

In the current topic, there is no termination. It is a case of resignation. This resignation is a forced one and needs to be proved first. That seems to be difficult now, according to me.

In my earlier post, I had invited discussion on whether there is a chance to prove that this resignation is a forced resignation. But no one discussed along these lines.

Please do not ignore the previous elaborate discussion on forced resignation and the appropriate forum for pursuing it. When we discuss the merits of the case, everything depends on the available evidence. The plaintiff must prove the manner of coercion through facts known to her. Her lawyer needs to carefully sift through that chain of evidence.

Circumstantial evidence determines whether a resignation was forced or voluntary. In the above case, the circumstantial evidence favors the lady, as she and others were forced to resign. These individuals who were coerced into resigning can support her claims.

She could potentially succeed in this case by filing a writ petition in the High Court and also lodging a complaint with the Human Rights Commission for additional support.

Regards,
Octavious

Though I appreciated your post, I do not agree with you that the lady can easily win her case. Therefore, I suggested in one of my posts as follows:

Advice on Forced Resignation

Dear Manishi48,

Now you cannot do anything about the forced resignation. Also, what evidence do you have to prove the forced resignation?

My advice to you is to be happy for yourself and your child coming into this wonderful world. Treat whatever has happened as good for you and your child. GOD has some better plans for you. Enjoy your motherhood. Wish you all the best.

Regards,

When I say she can easily win the case, I mean she has a very good chance of winning the case based on the merits that are favoring her. The toil she has to put in while she battles the case out is inevitable.

Regards,
Octavious

Case of Alleged Forced Resignation

The present case is a case of alleged forced resignation and not of termination. Normally, disputed questions of fact are not entertained before the High Court in writ proceedings. Therefore, the remedy will lie before the civil court only, as discussed earlier. Furthermore, it will not lie before the Human Rights Commission in view of the Santosh Hospital case of 2005, a decision of the Madras High Court to the effect that the commission cannot entertain complaints against a private body, but only if such a body is performing public functions when the commission can entertain the complaint.

Please refer to one of the latest decisions of Babu Lal vs. Guru Harkishan School, decided by the Delhi High Court on 1.5.2013, regarding the contention of forced resignation of the petitioner in writ jurisdiction. The petitioner was denied justice in the writ jurisdiction and asked to seek relief before the civil court. Kindly revisit your approach and thoughts so that the aggrieved may truly obtain justice and not end up as a rolling stone at the hands of others.

Regards

Legal Recourse Under Article 21

The lady has to invoke a Writ Petition under Article 21. Protection of Life and Personal Liberty: No person shall be deprived of their life or personal liberty except according to the procedure established by law.

Example: Francis Coralie Mullin v. The Administrator, Union Territory of Delhi and others.

The protection of Article 21 is wide enough and was further expanded in the case of Bandhua Mukti Morcha v. Union of India and others, in respect of bonded labor and weaker sections of society.

Article 21 guarantees, by way of a fundamental right to every person residing in India, the right to an effective and dignified existence with a view to leading a happy and healthy life. This, in turn, implies the guarantee of being ensured adequate means of livelihood and work.

The right to work and to carry on any legally permissible occupation or avocation in life, with a view to enjoying adequate means of livelihood for leading a healthy and meaningful life, is well sustained by the combined operation of Articles 14, 19(1)(g), and 21.

Thus, before a person can be deprived of their life and personal liberty as guaranteed by Article 21 by any procedure established by law, such law must steer clear of all the restrictions imposed by Articles 14 and 19(1)(g) on the power of the concerned Legislature to enact such laws.

Article 21 assures the right to live with human dignity, free from exploitation. In the above case, there was no clear procedure followed, as required and prescribed under the law, hence the act of the employer was riddled with unreasonableness and mala fide intentions.

K. Ramaswamy J., in his concurring judgment in the Delhi Transport Corporation D.T.C v. Mazdoor Congress and Others case, laid down in para 267 that "Before depriving an employee of the means of livelihood to themselves and their dependents, i.e., job, the procedure prescribed for such deprivation must, therefore, be just, fair, and reasonable under Articles 21 and 14, and when it infringes Article 19(1)(g), it must be subject to imposing reasonable restrictions under Article 19(5)."

Hope this clarifies my strategy.

Regards,
Octavious

The violations under Article 21 are considered against the state or its agencies, not against private companies. Moreover, the present case involves an alleged forceful resignation. Therefore, the above judgment is not applicable here.

Regards,

When you have insisted on a point, it is essential that it should be thoroughly discussed. You mentioned that the position of the article I projected was pre-1950. However, please refer to the Constitution Bench decision of the Supreme Court in PD Shamdasani vs Central Bank of India, which was followed in the famous ADM Jabalpur case of 1976, and other subsequent cases where violations under Article 21 are considered against the State. Furthermore, in the Bandhua Mukti Morcha case, the concept has been developed regarding Public Interest Litigation (PIL) and sanctions against the State to implement various labor laws. The present case pertains to an individual only, specifically concerning her alleged forced resignation.

Regards,
Sushil

Please read point no. iii in your above post where you have stated that no injunction is possible in the case of termination in private employment. If you understand this, then why did you advise a civil case?

Writ Petition as a Solution

The only way of getting reinstated back to her job is through a Writ Petition while seeking damages, which is permissible under Article 21 without impairing the right of the petitioner to claim damages under ordinary law through Civil Courts. Even if she doesn't want to go back to the job, with a Writ filed in court, she can always ensure that the company comes for an outside court settlement, thus ensuring a golden handshake. A writ petition would be much faster than Civil Court cases, and hence, a Writ Case is the best option.

Case Study: American Bank

Coming to my case, which I have stated, the American Bank had asked for specific performance as per the terms and conditions of the employment contract entered between American Express Bank and Priyanka Puri, as per which damages were levied upon Priyanka Puri, but the same was not entertained, and only the return of confidential documents was advised by the court. How you interpret precedents clearly indicates your lack of understanding of judgments in favor of the point you contest.

Regards,
Octavious

One should not expose their misadventures to such an extent that people start feeling pity for them, regardless of the age at which they may have entered. Please read my earlier posts where I have never stated that an injunction is permissible in private employment. I have emphasized that after a declaration that termination was wrongful on the grounds of resignation by coercion, consequent damages are admissible in the case. Furthermore, a writ petition will not lie against a private company on the grounds of an alleged violation of Article 21 since it is settled law that violations under Article 21 are considered against the State due to the words "due process of law" used in it, as per the ADM Jabalpur case.

Additionally, your approach that by merely filing a writ, the company will come out for an outside court settlement, shows how ignorant you are about legal practice. If this were the case, every private employee would file a writ petition and try to obtain a settlement with the private company outside of court. Do you think the company's lawyer will not contest vigorously regarding its maintainability? Generally, the concepts of a writ are known to every lawyer and High Court, so the stage of issuing notice to a private company will not even arise, let alone entering into a settlement. You could not cite a single decision in which your approach has any strength. Please do not get into splits on this petty issue. So please reconsider your approach.

Regards,
Sushil

Dear Miss, you have only two options:

1. Be quiet as you resigned.
2. Go for legal actions, but only if you have two proofs:
a. Birth certificate showing the birth of the newborn, which also proves that you were pregnant when you resigned.
b. Any proof showing that the resignation was taken forcefully. In this case, you may claim for the mental disturbance that occurred during the coercion to resign.

If you do not have such proof, my advice is to leave, as you already know the cost of justice, which is too heavy for us to pay.

Regards,
Ziad Hussain

You can still approach the labor department. It is the employer who has to prove that they have not forced you to resign.

I agree with the number of members that nothing can be done. Thinking from your point of view:

a) You should get maternity paid leave of 90 days, as well as get 3 months' compensation from the company, which is in the process of closing down. This is the real issue.

My Point of View:

a) The company has honored by paying more than the required compensation. How? The company is to give 3 months' salary in lieu of termination. Here it is resignation, not termination.

b) It is salary, not CTC (you have got CTC, which is normally higher than salary).

c) Does your resignation state the notice period and effective date? I hope it is not with immediate effect. Are you attending duties? These are some questions not replied to in your post.

d) Pregnancy is personal and has no legal bearing on the company. Manushiji, forget about this incident. Focus on your pregnancy and enjoy motherhood.

Best wishes to you,
Vir Matta