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ARTICLE · 13 FEBRUARY 2025

Supreme Court's Ruling On Arbitration And Statutory Rights: A Key Consideration For Employment Disputes

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As businesses increasingly rely on arbitration clauses to resolve disputes, this judgment serves as an important reminder that arbitration cannot be used as a tool to avoid

IndiaLitigation, Mediation & Arbitration
Rupin Chopra
Rupin Chopra
Shantam Sharma
Shantam Sharma
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The Supreme Court of India on December 11, 2024, in the case of Dushyant Janbandhu vs M/S Hyundai Autoever India Pvt Ltd1, has delivered a significant ruling with respect to the interaction between contractual terms and statutory rights. The case highlights that statutory rights, particularly those related to wages and employment disputes, take precedence over arbitration clauses in employment contracts. This judgment is a critical reminder for employers and businesses to ensure that their contracts align with statutory legal protections.

The Case Overview

The case arose when Mr. Dushyant Janbandhu, an employee of Hyundai Autoever, was terminated due to alleged absenteeism during the COVID-19 pandemic. Following his dismissal, Mr. Janbandhu filed claims under the Payment of Wages Act, 1936 (PW Act) and the Industrial Disputes Act, 1947 (ID Act), seeking unpaid wages and challenging his termination. The employer sought to invoke the arbitration clause in the

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