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Section 66: Definition of continuous service

The Industrial Relations Code, 2020 (Act No. 35 of 2020) • Official Statutory Text & Plain English Practice Guide

Statutory Mandate
Chapter IX: Lay-off, Retrenchment and Closure
Competent Labour Forum
Act No. 35 of 2020
Section 65 All 104 Sections of Industrial Relations Code, 2020 Section 67

Legal Commentary & Landmark Judgments: Section 66

Section 66 of the Industrial Relations Code, 2020 defines 'continuous service' for retrenchment and lay-off eligibility, establishing the core rule of uninterrupted service and enacting the statutory fiction deeming a worker to be in continuous service if they actually work for 240 days (190 days in mines) in the preceding 12 calendar months.

  • Core Rule of Uninterrupted Employment: Continuous service means uninterrupted service, including interruptions caused by sickness, authorized leave, accident, legal strikes, lock-outs, or cessation of work not attributable to worker fault.
  • Statutory 240-Day Deeming Fiction: Where a worker is not in uninterrupted service for a full year, they are statutorily deemed to have completed one year of continuous service if they actually worked under the employer for at least 240 days (190 days below ground in a mine) during the 12 calendar months preceding calculation.
  • Statutory Inclusions in Actual Working Days: The computation of 240 days includes days laid off under agreement or statute, paid maternity leave (up to 26 weeks), paid weekly holidays, and days of temporary disablement from employment injury.
Key Landmark Precedents:
  • Sur Enamel and Stamping Works Ltd. v. Their Workmen AIR 1963 SC 1914: Supreme Court held that to invoke the statutory deeming fiction of continuous service, the workman must prove actual work for 240 days in the 12 calendar months immediately preceding the date of termination.
  • Workmen of American Express International Banking Corp. v. Management (1985) 4 SCC 71: Landmark 3-Judge Bench ruling holding that Sundays, paid weekly holidays, and authorized paid leave must be counted towards computing the 240 days of actual work under industrial law.
  • Mohan Lal v. Bharat Electronics Ltd. (1981) 3 SCC 225: Affirmed that continuous service is an indispensable condition precedent to retrenchment protection; the 240-day test must be computed looking backwards from the date of retrenchment.
Courtroom Practice & Strategic Litigation Guidance:

In termination and retrenchment disputes, muster rolls, wage registers, and gate access logs are the primary battleground. Employers must preserve these records meticulously; when calculating the 240-day threshold, always credit Sundays, paid holidays, and approved leaves per *American Express*, as omitting them will lead to an illegal retrenchment finding.

Section 65 All 104 Sections of Industrial Relations Code, 2020 Section 67