Summary: In a recent court decision, P. Iyyappan successfully challenged a pay cut imposed by his employer, Tamil Nadu Generation and Distribution Corporation Ltd. The court ruled in his favor, citing violations of fairness.
P. Iyyappan, initially hired as a Regular Assessor by the Tamil Nadu Generation and Distribution Corporation Ltd. in Chennai, faced an unexpected reduction in his pay grade. On February 12, 2014, his pay was lowered without any prior warning. This led him to challenge the decision in court.
On June 10, 2022, the court dismissed Iyyappan's request, stating that he should have taken his complaint to the Labour Court instead. The court explained that since Iyyappan was hired on compassionate grounds, he wasn't eligible for a higher position.
"The conditions of service were governed under the terms of the agreement under Section 12(3) of the Industrial Disputes Act, 1947."
Iyyappan's lawyer argued that the pay cut was done without any warning, violating the rules of fairness. They pointed out that lowering his position and pay without explanation was unfair.
"The order was without any notice to the appellant and therefore, is in violation of principles of natural justice."
On December 16, 2025, Judges M.S. Ramesh and R. Sakthivel reversed the previous decision. They emphasized that a petition can be filed if there is a violation of fairness, even if another option exists.
"The order challenged in the petition, being against the principles of fairness, cannot be legally supported."
The court canceled the previous orders and reversed the pay reduction. They instructed the company to pay back any amounts taken from Iyyappan within four weeks.
"The order passed in W.P.No.8832 of 2014, dated 10.06.2022 is set aside."
The court decided in favor of Iyyappan, ruling that the pay cut was unfair and that the company must repay him the deducted amounts.
