'Employee's Dismissal For Unauthorised Leave Is Shockingly Disproportionate Punishment': Bombay HC Awards ₹15 Lakh Compensation

Mumbai, July 10, 2026: The Bombay High Court has held that dismissing an employee from service for remaining unauthorisedly absent for 240 days was a “shockingly disproportionate” punishment, especially when he had put in 16 years of service and no other serious charges were ultimately proved. Instead of reinstatement and back wages, the court directed the employer to pay the employee a lump sum compensation of Rs 15 lakh.

Justice Sandeep Marne passed the order on July 7 while hearing a petition filed by a co-operative sugar factory challenging the Labour Court and Industrial Court orders directing reinstatement of the employee with continuity of service and 100 per cent back wages.

Dismissal Challenged

The employee joined the sugar factory as a seasonal industrial worker in 1986 and was confirmed as a clerk in 1996. He was dismissed from service on February 12, 2002, after a domestic enquiry found him guilty of remaining unauthorisedly absent for 240 days between November 17, 1998, and July 19, 1999, along with other alleged misconduct.

The High Court noted that the Labour Court had accepted the domestic enquiry as fair but failed to decide whether the enquiry officer's findings were perverse before proceeding further. This denied the employer an opportunity to justify the dismissal by leading evidence, making the Labour Court's procedure legally unsustainable.

Court Finds Punishment Excessive

On examining the record, the court found that the charge of unauthorised absence stood proved. It observed that the employee had claimed he was ill and had applied for medical leave, but failed to ensure that his leave was sanctioned or to check the status of his applications.

The court said, “No doubt, he was negligent in not following the rules and remaining unauthorisedly absent for a considerable period of time. However, punishment of dismissal from service is not proportionate to the misconduct.”

Justice Marne noted that the employer had not pursued the remaining charges before the High Court. “Now that the other charges are not proved before me, the punishment of dismissal appears to be shockingly disproportionate,” the court observed.

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Rs 15 Lakh Compensation Awarded

Taking into account the employee's 16 years of service, the years left before retirement, his agricultural income and the disability suffered in an accident, the court set aside the orders of the Labour Court and Industrial Court and awarded Rs 15 lakh as compensation in lieu of reinstatement and back wages.

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