The principal question that arose before the The Hon’ble Bombay High Court (Aurangabad Bench) in The Pachora People’s Co-op. Bank. Ltd. Vs. The Employees Provident Fund Organisation (Ministry of Labour, Government of India), decided on 07.02.2014, was whether Pigmy Deposit Collectors were covered by the definition of ‘employee’ u/s 2(f) of the Employees Provident Fund Act and were earning wages u/s 2 (b) of the Act. The Hon’ble Court held that Deposit Collectors were workers within the meaning of the term as defined in the Industrial Disputes Act, 1947 and that, the work done by them was in tune with and traceable to the business of the concerned Bank. The Court held that the definition of ‘wages’ u/s 2 (rr) of the Industrial Disputes Act, 1947 squarely covered Pigmy Deposit Collectors and there was clearly a master and servant relationship between Pigmy Deposit Collectors and the concerned Bank they worked for. Therefore, it was held that Pygmy Deposit Collectors were entitled to Provident Fund benefits.
In coming to this conclusion, the Hon’ble Bombay High Court relied upon the Supreme Court’s decision in Indian Banks Association Vs. Workmen of Syndicate Bank and Ors. etc. reported in AIR 2001 SC 946 where the Apex Court, held that the commission received by Commission Agents or Deposit Collectors employed in Banks were nothing else but wages, which was paid to the Agents for promoting the business of the Bank. The Court further stated that, such Deposit Collectors were under direct control and supervision of the employing Banks and were accountable to the same for their work. Therefore, the Hon’ble Court held that Deposit Collectors were workers within the meaning of the term as defined in the Industrial Disputes Act, 1947 and that there existed a relationship of master and servant between such Deposit Collectors and the concerned Bank.
In light of the above decisions, it is quite clear that the present position of law considers Pigmy Deposit Collectors or Deposit Collectors as workers as defined in the Industrial Disputes Act, 1947, earning wages u/s 2 (rr) of the Act. Such Pigmy Deposit Collectors have already been specifically held by the Bombay High Court to be entitled to Provident Fund as employees of the respective Bank. PF is nothing but a retirement benefit and the purpose of PF is to give a monetary benefit to a worker after he stops working with an employer post-retirement. Similarly, Gratuity is paid by an employer upon cessation of services of an employee as an acknowledgement of the years of service put in by the employee and also to provide monetary benefit to an employee whose services have come to an end, to help him sustain himself in his old age. The Hon’ble Supreme Court in Sudhir Chandra Sarkar Vs. Tata Iron & Steel Co. Ltd. & Ors [1984 II LLJ 223] has held that the fundamental principle underlying Gratuity is that, it is a retirement benefit for long service as a provision for old age. Therefore, Pigmy Deposit Collectors may also be considered to be covered under the Payment of Gratuity Act.