One of the most debated issues in Indian labour law is whether an employer can repeatedly hire a worker on short-term or break-based appointments to avoid granting permanent status or statutory benefits. While many establishments use fixed-term or seasonal engagements, courts have consistently held that using repeated breaks as a strategy to deny continuity of service amounts to unfair labour practice. This article explains the legal position, key court rulings, and the rights available to workers who face such repeated temporary appointments.
What the Industrial Disputes Act Says
Under Section 25F of the Industrial Disputes Act, 1947, any worker who completes 240 days of continuous service in a year is entitled to certain protections before termination, including:
- Notice or wages in lieu of notice
- Retrenchment compensation
- Compliance with statutory procedure
When employers repeatedly hire workers for short durations and insert artificial breaks to prevent them from reaching “continuous service,” courts view this as a deliberate attempt to circumvent the law.
Such conduct has been recognized as unfair labour practice, as it deprives workers of rights they would otherwise earn through uninterrupted employment.
Judicial View: What the Courts Have Held
- Punjab & Haryana High Court: Repeated Short-Term Appointments Are Illegal
The Punjab & Haryana High Court has ruled that employers cannot repeatedly issue short-term or stop-gap appointments to the same worker for years.
The Court observed that:- Artificial breaks violate the spirit of retrenchment law
- Long-term service through repeated temporary appointments cannot be ignored
- Workers in such situations are entitled to reinstatement and full consequential benefits
In one case, a worker engaged for nearly 18 years through repeated temporary appointments was held entitled to reinstatement with compensation, as the employer’s conduct amounted to exploitation.
- Allahabad High Court: Year-After-Year Temporary Engagement Is Unfair Labour Practice
The Allahabad High Court has similarly held that:
Repeated yearly appointments without granting permanent status
Absence of retrenchment compensation
Continuous service disguised as temporary work
…constitute unfair labour practice.
The Court directed reinstatement with 25% back wages and recognized the worker’s status as permanent, noting that the employer had intentionally avoided statutory obligations.
Why Repeated Breaks Are Considered Unfair
Courts evaluate the substance of employment, not the form.
If a worker:
- Performs the same duties continuously
- Works for years with only artificial breaks
- Is reappointed immediately after each break
- Has no genuine seasonal or project-based reason for discontinuity
- …then the employment is treated as continuous, regardless of the employer’s paperwork.
This ensures that employers cannot use technicalities to deny workers their rightful benefits.
Key Takeaways for Employers and Employees
- Repeated temporary appointments without retrenchment benefits are unlawful
Such practices violate the Industrial Disputes Act and are treated as unfair labour practice. - Long-term workers (e.g., 18+ years) cannot be denied permanent status
Courts have consistently granted reinstatement and compensation in such cases. - Artificial breaks do not break continuity of service
If the intention is to deny statutory rights, courts will treat the service as continuous. - Employers must follow fair labour practices
Using temporary contracts to avoid legal obligations can lead to litigation, reinstatement orders, and financial penalties.
Conclusion
Indian labour law strongly discourages the misuse of temporary appointments and artificial breaks in service. Employers must ensure that staffing decisions are fair, transparent, and compliant with statutory requirements. Workers who have served for long periods through repeated temporary engagements are entitled to continuity of service, retrenchment benefits, and in many cases, permanent status.
By adhering to fair labour practices, employers not only comply with the law but also build a more stable and motivated workforce.
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Disclaimer – This blog post is a general guide. It should not be considered legal advice. Consult a legal professional for more details.