The Supreme Court recently ruled that service rendered as a contractual employee cannot be counted towards pension purposes. The decision was delivered by a bench of Justice MR Shah and Justice CT Ravikumar in the case of Uday Pratap Thakur and others v. State of Bihar and others.
The court upheld a rule of the Bihar government which stipulated that only the period of service rendered as a regular employee would be taken into account for calculating the eligible minimum service period for pension of the employee subsequently regularized. The court was asked whether service provided under a contractual capacity could be considered for the determination of the pension amount after regularization of the contractual employees under the work charge system.
The court held that contractual employees are not appointed to the same position as regular employees, who are appointed through a proper selection process based on recruitment rules, and therefore, the service rendered by contractual employees under work charge could not be considered for the calculation of pensionable service. However, after providing service for several years before regularization, contractual employees cannot be deprived of pension solely on the ground that they have not completed the eligible service for pension.
The rule 5(v) of the Bihar Pension Rules, 2013, allowed the government to count service under a contractual capacity for the purpose of calculating pension after regularization, was not upheld by the court.