The Supreme Court has upheld a 2009 law entitling private school teachers gratuity, retrospectively from 1997, while vacating a stay on the operation of the law. Private schools will now have to pay gratuity to all teachers who retired after 1997.A bench of Justices Sanjiv Khanna and Bela M Trivedi dismissed more than 20 petitions filed by the Independent Schools' Federation of India along with those by other private schools and ordered them to "make payment to the employees/teachers along with the interest in accordance with the provisions of the Payment of Gratuity (Amendment) Act within six weeks".
The SC bench said, "Payment of gratuity can't be categorised as a windfall or a bounty payable by private schools as it is one of the minimal conditions of service. In this background, the argument of private schools that they don't have capacity and ability to pay gratuity to the teachers is unapt and parsimonious. All establishments are bound to follow law, including the Payment of Gratuity (Amendment) Act, 2009."
When private schools pointed out that not all of their tribe are financially healthy, the bench said, "It is possible that in some states there are fee fixation laws which will have to be complied with. But compliance with these laws doesn't mean that teachers should be deprived and denied gratuity, which they were/are entitled to receive as other employees of educational institutions.
"Regulation of fee is to ensure that there is no commercialisation and profiteering, and the effect is not to prohibit a school from fixing and collecting 'just and permissible school fee'," the bench said.
The schools had argued that the 2009 legislation was in violation of an apex court judgment that had upheld the view that private school teachers were not employees and hence disentitled to get gratuity.
Writing the judgment, Justice Khanna said the Supreme Court even while disallowing the claim of teachers to gratuity, had itself pointed out lacunae in the earlier gratuity law but had said it was for the legislature to correct it. The legislature's decision to correct the anomaly in the law did not amount to overruling of the SC judgment, he said.
"Private schools, when they claim a vested right arising from the reason of defect, should not succeed, for acceptance would be at the expense of teachers who were denied and deprived of the intended benefit," the bench said. The SC said provisions of the payment of gratuity law, post the retrospective amendments, would apply only to those teachers who were in service as on April 3, 1997, and at the time of termination have rendered service of not less than five years.
