Sec -218 Protection of employees during investigation
Updated: Oct 4, 2022
Protection of employees during investigation.
This article is an in-depth explanation of the sec 218 of companies act 2013 .This article states about,as the section title explains,protection of employees during investigation. The article states the bare provision and then the explanation of the bare provision for further understanding.
Quoting the bare provision
(1) Notwithstanding anything contained in any other law for the time being in force, if—
(a) during the course of any investigation of the affairs and other matters of or relating to a company, other body corporate or person under section 210, section 212, section 213 or section 219 or of the membership and other matters of or relating to a company, or the ownership of shares in or debentures of a company or body corporate, or the affairs and other matters of or relating to a company, other body corporate or person, under section 216; or
(b) during the pendency of any proceeding against any person concerned in the conduct and management of the affairs of a company under Chapter XVI,
such company, other body corporate or person proposes—
(i) to discharge or suspend any employee; or
(ii) to punish him, whether by dismissal, removal, reduction in rank or otherwise; or
(iii) to change the terms of employment to his disadvantage,
the company, other body corporate or person, as the case may be, shall obtain approval of the Tribunal of the action proposed against the employee and if the Tribunal has any objection to the action proposed, it shall send by post notice thereof in writing to the company, other body corporate or person concerned.
(2) If the company, other body corporate or person concerned does not receive within thirty days of making an application under sub-section (1), the approval of the Tribunal, then and only then, the company, other body corporate or person concerned may proceed to take against the employee, the action proposed.
(3) If the company, other body corporate or person concerned is dissatisfied with the objection raised by the Tribunal, it may, within a period of thirty days of the receipt of the notice of the objection, prefer an appeal to the Appellate Tribunal in such manner and on payment of such fees as may be prescribed.
(4) The decision of the Appellate Tribunal on such appeal shall be final and binding on the Tribunal and on the company, other body corporate or person concerned.
(5) For the removal of doubts, it is hereby declared that the provisions of this section shall have effect without prejudice to the provisions of any other law for the time being in force.
Explanation :-Despite anything written in any other law for the time being in force if:-
During the course of investigation of an affair or any other matter of company relating to body corporate ,person u/s 210,212,213,219,216. Or
During any pending proceeding against any person involved in management
i) to discharge or suspend any employee
ii) to punish by dismissal ,removal or reduction of rank or otherwise
iii) to change terms of employment to his disadvantage
The company needs to take an prior approval of the tribunal of the punishment proposed and if the tribunal is not agreed to the punishment proposed then it may send a notice by post to the company.
2.If the company didn’t receive a revert of the application sent u/subsection 1 within 30 days then and only then the company may proceed to take the proposed punishment against the employee.
3.if the company is not satisfied with the objection raised by the tribunal he may Appeal in Appellate Tribunal within 30 days of receiving the objection notice which is followed by a prescribed fee .
4.the decision given thereafter shall be final and binding on the company I.e. no further appeals can be made in this regard
5.the provision of this section will remain unaffected by any of the other laws for the time being in force.
This section deals with how the management can proceed in case of an investigation. In simple words the management can’t themselves prescribe a punishment to the employee undergoing investigation and prior approval by an application to the tribunal has to be made beforehand. If the tribunal did not approve the application,then the company can appeal to the appellate tribunal within 30 days of receiving disapproval by the tribunal. Whatever the decision of the Appellate Tribunal it is final and binding for the company. This section makes it very clear with its first statement that this section will not be affected by any other law for the time being in force.