The Gujarat High Court has ruled that endorsing settlement claims within Lok Adalat does not constitute misconduct. It underscores that even if an employee’s conduct may seem like a lapse in judgement or negligence while executing their responsibilities, it cannot be classified as misconduct unless the organisation can prove that it resulted in some kind of irreversible harm. This underscores the importance of assessing the gravity of negligence.
The court was addressing two interrelated appeals. In the first appeal, an insurance company challenged a verdict that reversed the petitioner’s termination from employment and granted all relevant entitlements, essentially declaring the dismissal null and void. The second appeal was related to the denial of request for interest on pension and other benefits after the nullification of the termination order and its subsequent confirmation through appeal.
In a verdict delivered by the division bench comprising Chief Justice Sunita Agarwal and Justice NV Anjaria, it was observed that this could potentially be a situation involving a lapse in judgement or an instance of negligence in the petitioner’s discharge of duty. However, it must be emphasised that such actions do not amount to misconduct unless the appellant, the company, can substantiate that the petitioner’s actions caused irreparable harm to the company, indicating a high degree of negligence.
The bench further added that there is no need for intervention in the judgement rendered by the learned single judge. The appeal presented by the appellant company, identified as Letters Patent Appeal No. 1114 of 2022, was dismissed as it lacked merit.