Legal Representative representing the estate of a deceased person includes any person who intermeddles, the deceased employer as well! however, the code on wages has been clarified by including legal representatives under the definition of employer.
Karma Global is in the business of establishment and vendor compliance management. It has hundreds of elite clients on its excellent service dispensing list. The expert staff on its roll deals with thousands of regulatory compliance acts on a Pan India basis , some of the acts being state-specific while others are enacted by the Central Government.
Karma Global, in its day-to-day compliance service operations, has to deal with several issues raised by clients that they are unable to tackle and the onus of dispensing with quick solutions and /or customized solutions, rests solely with Karma Global because it is the service provider to this client in terms of all labour and court-related services, be it notices, summons, arrest warrants, penalties, etc.
The expert staff of Karma Global is also seized with, in the course of their operations, most of the time with death cases of clients employees and benefits to the deceased as well as with the deaths of the employers and post-death, what will be the repercussions, challenges, benefits and passing of the legacy to the next kin and kith.
Since the subject matter is about legal representation to the deceased employer, let us understand the definition of legal representation :
A legal representative is defined by Section 2(11) of the Civil Procedure Code as follows:
A Legal Representative means a person who in law represents the estate of a deceased person, and includes any person who intermeddles with the estate of the deceased, and, where a party acts in a representative character, the person on whom the estate devolves on the death of the party so acting;
It will, therefore, be seen that the term ‘legal representative’ means not only a person, who in law represents the estate of a deceased person but, also includes any person who intermeddles with the estate of the deceased.
In the case of The Kalyanmal Mills Ltd. vs Volimohammed And Anr. on 7 August 1962, the defendant Mills contested the application of the representative, on the ground that the claimant was not the real daughter of the deceased, Wali Mohammad. The question, therefore, arises whether her name could be substituted as a legal representative of the deceased plaintiff.
In Custodian of Branches of Banco versus Nalini Bai Nautique, the Supreme Court of India expanded the definition of legal representative as defined under Section 2(11) of the CPC thus:
“Appointment of Legal Representative is not restricted to the legal heirs of the deceased but it also extend to the other people who are competent to inherit the property of the deceased and she/he shall also ensure that the estate of the deceased is represented in proper manner. The Legal representative can be executors and administrators as well who is in the possession of the estate of the deceased. In the absence of fraud or collision, the bona fide possessor of the estate or the bona fide heir of the estate can also become the Legal Representative.”
Let us also take a look at the definition of the personal representative
“A personal representative or legal personal representative is the executor or administrator for the estate of a deceased person. Personal representatives serve as fiduciaries of the beneficiaries of estates and have the duty to act in good faith, with honesty, loyalty, and candor, and in the best interests of the estate’s beneficiaries. The law requires personal representatives to follow the terms of the deceased person’s will (assuming that the individual who died had a will). If the deceased person died intestate, the personal representative will serve as the administrator of the intestate estate”
However, there has been a lot of confusion about the term legal representation especially when it came to the role of any person who intermeddles.
This has now been set aside with the Government including legal representative under the definition of an employer under the code of wages 2019 and the definition contained in the Extraordinary Gazette Notification dated 8th August 2019 for quick reference, is reproduced below :
(l) “employer” means a person who employs, whether directly or through any person, or on his behalf or on behalf of any person, one or more employees in his establishment and where the establishment is carried on by any department of the Central Government or the State Government, the authority specified, by the head of such department, in this behalf or where no authority, is so specified the head of the department and in relation to an establishment carried on by a local authority, the chief executive of that authority, and includes,—
(i) in relation to an establishment which is a factory, the occupier of the factory as defined in clause (n) of section 2 of the Factories Act, 1948 and, where a person has been named as a manager of the factory under clause (f) of sub-section (1) of section 7 of the said Act, the person so named;
(ii) in relation to any other establishment, the person who, or the authority which, has ultimate control over the affairs of the establishment and where the said affairs is entrusted to a manager or managing director, such manager or managing director;
(iii) contractor; and
(iv) legal representative of a deceased employer
Liability of legal representative as an employer
There are no limited areas defining the power and the role of legal representatives, but it is with the strict consciousness of mind that they have the duty to perform the tasks with the keenness of heart to do a better administration of the roles entrusted to the employer. In some of the cases, the legal representative is also expected to protect the company’s properties and facilitate legal transaction. The legal representative is also authorized to execute all the actions related to carrying out the general administration of the company and all other operational aspects and such action shall not exceed the nature and scope of that company’s business. He cannot merely shrug off his responsibility as an employer on the grounds of non-dependency on the deceased employer.
The legal representative must also ensure fair play, justice and peace at the workplace, including protection of the workplace from unnecessary legal disputes between the company and other related parties. It shall also be the duty of the legal representative to execute all his responsibilities to avoid any kind of hassles or intervention of other administrative or judicial authorities. Further, the legal representative of a deceased employer is also responsible to adhere to all the regulatory acts as is enacted by the Government for purpose of running a business, be it payment of dues like minimum wages and bonus to the employees and other gratuity benefits which they are entitled to get for past and future work.
Rights of Legal Representatives
There is no uncertainty about the fact that upon the death of the principal employer, the legal representative of such an employer substitutes himself with that of an employer in the establishment, as a means of rightfully and legally stepping into the shoes of the deceased employer. Legal representatives have also been given certain rights as individuals after taking up the responsibility of the deceased employer. In Prem Singh v. Savitri Devi & Ors, the High Court of Rajasthan opined that the legal representative could urge all contentions that the deceased could have urged except only those which were personal to the deceased. However, it is of paramount importance to ensure that the legal representative does not deviate from the principles carried on by the deceased employer and accepts the same wholeheartedly as a matter of being bound morally, socially, and economically for the greater good of the organization and its people working for the same.
Conclusion
When it comes to providing solutions or quick turnaround to any issues or challenges faced by our clients which are more than 400 in numbers on Pan India basis, Karma Global has all the expertise in its household, to take away all the hassles of the employer, be it the regulatory compliances or notices and summons. We are glad that till today, most of the high flying employers have stood with our services and the testimonials given by them are very satisfying indeed.
We have dealt with several cases relating to legal representation in case of the disease which we have handled with zest and sincerity and here again, the feedback is very rewarding.
It can be said that the inclusion of a legal representative under the definition of the employer has been a significant step taken by the legislature while enacting The Code on Wages, 2019. The sole objective of the legislature behind the merger of the repealed acts is “to seek to regulate wage and bonus payments in all employments where any industry, trade, business, or manufacture is carried out.” By including ‘legal representative’ under the definition of the employer, the employees have been given an opportunity to enforce their rights and claim their share of outstanding and legitimate dues as applicable in case of death of the principal employer.
Legal representatives cannot deny any of the employee’s dues of any kind when it comes to fulfilling any conditions which the principal employer was obligated to fulfill in case he/she was alive. In case of non-fulfillment of any duty which the legal representative is supposed to do, he will be subjected to the same punishment as the principal employer would have in case of non-fulfillment of such duty.
In fact section 28B – continuance of proceedings states : (1) where a person dies, his legal representative shall be liable to pay any sum which the deceased would have been liable to pay if he had not died, in the like manner and to the same extent as the deceased.
Provided that, in case of any penalty payable under this Act, a legal representative shall be liable only in case the penalty has been imposed before the death of the deceased person.
Every legal representative shall be personally liable for any sum payable by him in his capacity as a legal representative if, while his liability for such sum remains undischarged, he creates a charge on or disposes of or parts with any assets of the estate of the deceased, which are in, or may come into, his possession, but such liability shall be limited to the value of the asset so charged, disposed of or parted with.
Thus, it is a great gesture on the part of the legislature to add a legal representative to the definition of employer can be seen as a very positive and exemplary action so as to protect the rights of the employees in the establishment.
Proprietory blog of Karma Global Tech Management Firm
This blog has been compiled by the internal staff of Karma Global with the knowledge and expertise that they possess, for its monthly newsletter Issue 03 of September 2022 in case of specific or general information or compliance updates for that matter, kindly reach out to the
Marketing Team – Kush@karmamgmt.com / yashika@karmamgmt.com