Pay subsistence allowance to managerial staff’ Underlying principle of payment is to allow an individual sustain himself, says court Cj bench




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‘Pay subsistence allowance to managerial staff’
Underlying principle of payment is to allow an individual sustain himself, says court

Published: 11th February 2020 05:36 AM  |   Last Updated: 11th February 2020 05:36 AM  |  A+A A-

Madras High Court building. (File Photo | EPS)
By Siva Sekaran
Express News Service
CHENNAI: Is a managerial staff, who has been suspended from service, entitled to subsistence allowance? The First Bench of the Madras High Court ruled in affirmative when this question was raised. M Elango, secretary of a Primary Agricultural Co-operative Credit Society, was suspended in 2016 for certain irregularities. Now, as per the special by-laws, anybody employed in the managerial or administrative capacity is not entitled to subsistence allowance. 
Assailing the judgment of a single judge dated October 25, 2018, in a writ appeal, the Registrar of Societies contended that Elango, on being suspended and later terminated from service, is not entitled to subsistence allowance. Elango moved the High Court and a single judge in 2018 ordered payment of the allowance. Hence, the present appeal.

Upholding the order, the bench, comprising Chief Justice AP Sahi and justice Subramomium Prasad, said the contention that a secretary or a manager ceases to have the need of basics and continue to live at the bare minimum on being suspended cannot be accepted. The underlying principle for making payment of subsistence allowance is to allow an individual to sustain himself. In the present context of the suspension of an employee, one has to keep in mind that services of an employee have not been snapped and the employer-employee relationship during suspension, continues to subsist.
“…it is the right of sustenance of an employee to receive subsistence allowance. As to what would be the ratio to which an employee may be entitled in the present context, will have to be left to the discretion of the employer, as by-law 31(2) indicates that the employer may pay subsistence allowance as he may deem fit. This discretion, however, may be subject to any such deductions in the event an employee is found to be ultimately guilty of heavy financial irregularities,” the bench said.
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