Supreme Court in its important judgement dated 19.11.2011 (copy attached) has held that workers cannot be forced to work under new management without their consent and in such an event they are entitled to retirement/ retrenchment compensation under Industrial Disputes Act.
In this case Philips India Ltd had entered into an agreement for sale of its consumer electronics factory at Salt Lake City, Calcutta with Kitchen Appliances India Ltd. Some of the workers had opposed the move and demanded compensation. Management took the plea that the workers had neither been retired nor resigned nor retrenched and hence the question of payment of compensation should not arise, which was turned down by the court.
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