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Petitioner: Employers Federation of Pakistan & others VS Respondent: Government of Sindh &
Court Name: Sindh High Court Judge(s): Salahuddin Panhwar, Adnan-ul-Karim Memon Title:Employers Federation of Pakistan & others vs Government of Sindh &
JUDGMENT
Reported As: KLR 2022 Labour & Services Cases 88 Result: Order accordingly Judgment JUDGMENT SALAHUDDIN PANHWAR J. Through captioned petitions, the petitioners have challenged Notification dated 09.07.2021 issued by respondent No.1/Province of Sindh through Secretary Labour & Human Resources Department in exercise of powers conferred under Section 4(1) read with section 6(1)(a) of The Sindh Minimum Wages Act, 2015, which reads as under: "GOVERNMENT OF SINDH LABOUR & HUMAN RESOURCES DEPARTMENT Karachi dated the 9th July, 2021 NOTIFICATION No: L-II-13-3/2016: In pursuance of the provisions of Section 4(1) of the Sindh Minimum Wages Act, 2015 and in exercise of the powers conferred by Sub-Section (1) (a) of Section 6 of Sindh Minimum Wages Act 2015, Government of Sindh is pleased to declare the minimum rates of wages Rs.25000/-per month for unskilled adult and juvenile workers employed in all industrial/commercial establishments in Sindh shall be as given in the schedule appended to the minimum rates of wages, with effect from 01.07.2021. The minimum rates of wages for unskilled adult and juvenile workers employed in all the industrial/commercial establishments in the Sindh province on reference from Government of Sindh. under Section 4 of Sindh Minimum Wages Act, 2015. I. The minimum rates of wages shall apply to all unskilled adult and juvenile workers employed in all industrial/commercial establishments of any sort (registered or unregistered) located in Sindh
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and minimum rates of wages shall be applicable uniformly throughout the Province. III. These minimum rates of wages shall be applicable as per provisions of the Sindh Minimum Wages Act, 2015 and shall come into force with effect from 01.07.2021, after approval and Notification to be issued by Government of Sindh, under Section 6 of the said Act. III. A female worker of the category shall get the same minimum wages as allowed to a male worker of the category of such work. IV. The daily/weekly working hours and conditions of overtime work and work on weekly days of rest and on paid holiday, etc. in respect of the unskilled adult and juvenile workers of the given category shall be regulated by the Sindh Factories Act, 2015, Payment of Wages Act, 2015 and other relevant Labour law. V. The minimum rates of wages of other categories of workers (skilled and semi skilled) employed in any industry shall in no case be less than the minimum rate of wages, now for unskilled adult and juvenile workers in the Sindh province. VI. The employers in all industries whether registered or unregistered shall pay to the adult unskilled and juvenile workers at the rate not less than that proposed in the schedule appended herewith. VII. The wages will mean "wages" as defined in section 2 (xix) of the Sindh Minimum Wages Act, 2015. VIII. The employers shall revise, where necessary the rates of remunerations for piece rated workers so as to ensure that the worker in each piece rate occupation is enabled to earn not less than Rs.120.00 per hour in any working day. IX. The minimum rates of wages shall not be regarded as maximum rates and existing wages, higher than the minimum wages now fixed, shall not be reduced. The Employers shall, however be free to pay higher wages either unilaterally on their initiative or by collective agreement in view of any special consideration, including experience or higher cost living to a particular locality or other reasons. X. The minimum rates of wages shall be applicable to time rated/whole time workers including temporary piece rated workers with effect from the date of Notification issued by Labour & HR department, Government of Sindh, of these minimum rates of wages under Section 6 of the Sindh Minimum Wages, Act, 2015. XI. The workers shall continue to enjoy such facilities like free accommodation/house rent, water, electricity, conveyance, free medical gratuity, pension, bonus, any kind of insurance, provident fund, recreation, free food subsidized food education, holidays and leave with pay, attendance allowance and any other benefit already provided by the employers. XII. No variable or incentive allowance or value of welfare facilities as mentioned above shall be adjusted against the minimum rates wages. XIII. The schedule of minimum rate of wages for unskilled adult and juvenile workers is appended below: S No.CATEGORY OF WORKER MINIMUM RATES OF WAGES PER DAYPER MONTH 1.Unskilled Adult & Juvenile workers employed in Industrial/commercials Undertakings in Sindh Province. Rs.961.00Rs.25000.00 All industrial, commercial and other establishments registered under any law shall wages to the employees through cross cheque/bank transfer, under section 6 of the Sindh Payment of Wages Act, 2015." As identical issue is involved in all the above captioned petitions, therefore, we dispose of captioned petitions through common judgment.
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2. The grievance of the petitioners is that minimum rates of wage for unskilled adult and juvenile Workers employed in all the industrial/commercial establishments in the province of Sindh has been increased from Rs.17500/- per month to Rs. 25,000/- per month with effect from 01.07.2021 through the impugned Notification. Nonetheless in pursuance of 18th Amendment to the Constitution, the legislative and executive powers with regard to 'Labour and Manpower' have been devolved upon the Provinces, as such respondent No.1 enacted the Sindh Minimum Wages Act, 2015 (Sindh Act No. VIII of 2016) and published the same in the Sindh Gazette on 12.04.2016. The prime purpose of the Act is to regulate minimum wages and other, allowances for different categories of workers, working in certain industrial/commercial establishments. However, The Act of 2016 was amended vide Sindh Minimum Wages (Amendment) Act 2018. In pursuance of Section 3 of the Act as amended, the Respondent No.1 constituted Sindh Minimum Wages Board (respondent No.2). Whereas, The Board, comprises of members representing the organization of employers and such direct participation of the representatives is mandatory requirement under the law. Moreover, the respondent No.2 upon a reference made to it by respondent No.1, after inquiry as deemed fit, may recommend to the respondent No.1 the minimum rates of the wages for adult, skilled and unskilled workers and juvenile and adolescent workers employed in the industrial establishments or commercial establishments or both. That the scope of recommendations to be made have been provided under Sections 4&5 of the Act, and under Section 6(1)(a), and Respondent No.1 upon receipt of recommendations by respondent No.2 under Sections 4 & 5 of the Act, may either by notification in the official Gazette, declare that the minimum rates of wages recommended by the respondent No.2 for the various workers shall subject to such exceptions as may be specified in the Notification be the minimum rates of wages or as per section 6(1)(b) or if it considers that the recommendations are not in any respect, equitable to the employers or the worker, within 30 days of such receipt, refer it back to the respondent No.2 for reconsideration with such comments thereon and giving such information relating thereto as Respondent No.1 may deem fit to make or give it. However, section 6(2) of the Act provides that where the recommendations are referred back to Respondent No.2 under Section 6(1)(b), Respondent No.2 shall reconsider it after taking into account the comments made and information given by Respondent No.1 and if necessary; shall hold further inquiry and submit to the respondent No.1, a revised recommendation or if it considers that no revision or changes in the recommendations is called for, make report to that effect stating reasons thereon. Moreover, under Section 6(3), upon receipt of the recommendation under sub-section 2, Respondent No.1 may through notification declare the minimum rates of wages for workers as recommendations subject to such modifications and exceptions as may be specified. It is further submitted that section 6 makes it absolutely clear that the recommendation' under section 6(2)(a) are binding upon the respondent No.1 and words 'subject to such modifications and exceptions' by no stretch of interpretation allow the respondent No.1 to reject or substitute the minimum rates of wages recommended by the respondent No.2, and Respondent No.1 in exercise of powers conferred under sections 6(1)(a) or Section 6(3) of the Act must be published in the official Gazette and can only take effect from the date of its publication. 3. It is further stated that pursuant to the provisions of the Act, on the recommendation of Respondent No.2, the proposed minimum wage rate was notified and published by respondent No.1 in the official Gazette of Sindh on 08.08.2019, whereby objections were invited from the affected parties and suggestions on the proposed minimum wage rate of Rs. 17,500/- per month for unskilled workers employed in the industrial/commercial sectors within the province of Sindh. However, no objections were brought forward, hence the rate of Rs.17500/- per month or Rs.675/- per day was notified within Sindh province vide Notifications dated 19.09.2019 with effect from 01.07.2019 respectively. However, owing to purported inflation, Respondent No.1 decided to revisit the
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minimum wage rate and Respondent No.2 held a meeting on 03.12.2020, deliberating a new proposed minimum wage at the rate of Rs.19,000/- per month for unskilled workers for the province of Sindh, wherein following decision was made: "After detailed deliberation on the matter all the members of the Board agreed to increase & fix Rs.19,000/- per month the minimum wages for the un-skilled workers of the province of Sindh. It was also decided to publish the recommended wage rates in the official Gazette for inviting objections/suggestions. 4. Thereafter, the respondent No.1 published recommendation wage rate of Rs.19000/- per month in the official Gazette of Sindh on 17.12.2020, inviting objections/suggestions from all stakeholders affected 9% increase within 30 days. In pursuance thereof, various objections were submitted by the affected stakeholders. Whereas, on 22.04.2021, the respondent No.2 held a meeting, wherein such objections were considered thereafter, it was decided to increase the minimum rates of wages from Rs.17,500/- per month to Rs.19000/- per month for unskilled workers with effect from 01.04.2021 and forwarded the recommendation to the respondent No.1 for adoption by issuing of the Notification under section 6 of the Act. It is further submitted that on 01.06.2021, a summary was placed before The Chief Minister by placing the recommendation of respondent No.2 to increase the minimum rate of wage to Rs.19000/- and for issuance of the Notification, but the same was not issued. However, Sindh Assembly while announcing the budget for the financial year 2021-22, increased the rate of wages for unskilled workers to the tune of Rs. 25,000/- per month. But according to the petitioners; such announcement is not and could not have formed part of the financial budget or any money bill. It is further submitted that instead of adopting the binding recommendation of the respondent No.2 under Section 6(1)(a) of the Act or referring the matter back to the respondent No.2 in terms of sub clause (b) of Section 6(2), the respondent No.1 on 09.07.2021 issued the impugned Notification whereby minimum rate of wages of unskilled adult and juvenile workers employed in the industrial/commercial sectors in the province of Sindh has been fixed at Rs. 25,000/- per month or Rs. 9611- per day and according to the petitioners, such increase of 43% is, completely unjustified and untenable. 5. According to the petitioners, the impugned Notification has been purportedly issued in pursuance of the provisions of Section 4(1) of the Sindh Minimum Wages Act, 2015 and in exercise of powers conferred by sub-Section(1)(a) of Section 6 of Sindh Minimum Wages Act, 2015 whereas it could not have been issued under Section 6(1)(a) as the Respondent No.2 has never recommended increase in the rate of It is further stated that the quantum of other wages to the tune of Rs.25,000/- and the only recommendation was before the respondent No.1 for increase of the rate of the wages to Rs.19,000/- per month which rate was neither notified nor referred back, as such, it is submitted that in absence of any recommendation, the increase of rate of wage to Rs.25,000/- per month or Rs.961/- per day through impugned Notification is without jurisdiction, null and void. It is further submitted that no notification was published to invite public objections which clearly stipulates that the impugned Notification was issued in haste manner in complete violation of the law and further the Sindh Finance Act, 2021 does not provides any increase in the minimum rate of the wages. Even otherwise such rate of wages could not have been increased through Money Bill; that in the impugned Notification it is mentioned that it was issued under Section 6(1)(a) on the recommendation of respondent No.2 made under section 4, whereas, there was no recommendation has ever been made. It is further asserted that respondent No.2 held meeting on 22.04.2021, when the minimum rate of wages for the unskilled adult and juvenile workers was recommended at @ Rs.19000/-, which was confirmed by the members of Respondent No.2 in pursuance to the responses made by certain trade associations, as such the impugned Notification is liable to set aside. The petitioners have further submitted that after issuance of the
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impugned substantial Notification, there is substantial difference surfaced between the rate of the wages in the Sindh and in other provinces of the Pakistan, which is reproduced as under:--- AreaPrevious rate New ratePercentage increase Federal Territories Rs.17,5000/-Rs.20,000/- 14.2% Punjab Rs.17,500/-Rs.20,000/- 14.2% KPK Rs.17,5000/-Rs.21,000/- 20% Baluchistan Rs.17,5000/-Rs.21,000/- 20% Sindh Rs.17,500/-Rs.25,000/- 43% Export Processing Zones in SindhRs.17500/-Rs.20,000/- 14.2% 6. It is further stated that the quantum of other contributions such as social security etc. are also calculated on the basis the minimum wages as such devastating effect of such increase is not limited to the wage, but also to other contributions as well, that are bound to substantially increase as a result, which unjustified burden is sought to be imposed through the impugned Notification. It is lastly contended that the impugned Notification has not yet been published in the official Gazette as such the same is not binding upon the petitioners, therefore, through the captioned petitions, the petitioners have prayed to declare the impugned Notification as illegal, arbitrary and without jurisdiction. 7. We have heard Mr. Khalid Mahmood Siddiqui, Mr. Khalid Javed, Mr. Abid S. Zuberi, Mr. Ayan Mustafa Memon, Mr. Zaheer-ul-Hassan Minhas, Mr. Faiz Durrani Mr. Fasihul Karim Siddiqi, Syed Mohsin Ali, advocates for the petitioners and Syed Shoa-un-Nabi, Mr. Sarwar Jamali, and Mr. Shoaib Ali Khatian, advocates as well as learned Assistant Advocate General Sindh and M/s. Zehra Akbar Khan, Karamat Ali, Liaquat Ali Sahi, Jan Muhammad Khaskheli, representative of various Labour Organizations and Mr. Jawwad A. Sarwana, learned Amicus and meticulously examined their contentions. 8. In all captioned petitions the Notification dated 09th July 2021 has been impugned by the employers on the plea that as per the Notification, the Wages Board recommended wage at the rate of Rs.19000/- per month with effect from 01st April 2021, conversely, the. Cabinet disagreed, and it is contended that, while violating the mandatory provisions under Sections 4&5 of the Sindh Minimum Wages Act, 2015, notified minimum wages at the rate of Rs.25000/- per month in the province of Sindh. Accordingly, the learned counsel for the petitioners contended that determination of the wages cannot be pronounced by the judicial Act and they can be regulated by the Legislative Act only; Whereas the legislative assembly promulgated minimum wages Act 2015 in view of ILO 1970, which provides existence of mechanism between the employer and the employee respectively, hence, the Minimum Wages Act 2015, provides that the Board having equal representation of the employer and employee, apart from the independent Board Members. All members recommended Rs.19000/- per month, however, two members dissented and one member namely Ms. Zehra recommended Rs.20,000/-.It is argued that the recommendations of the Board are binding upon the government and government was not competent to announce wages without recommendations. However, Government if was of the view that wages are improper, recourse is provided while referring the matter again to the Board. They have relied upon decisions reported as 2014 SCMR 1015, PLD 2014 SC 1, PLD 2016 SC 570, PLD 2021 (C.S) 420, PLD 2016 SC 995, PLD 2013 Sindh 285, 1967 PLD 229 DACCA, 2006 PLD SC 697, 2014 SCMR 676, 36 (1994) SCC 651, PLD 2012 SC 1, PLD 2007 SC 277, PLD 2021 ISL 144, 2010 SCMR 1301, PLD 1990 SC 1092. PLD 1993 SC 341, 1991 SCMR 1041 and PLD 2005 SC 193. 9. On the other hand, the learned Assistant A.G. Sindh while refuting the contentions raised by the learned counsel for the respective parties contended that the Board's decision is advisory in nature
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and the Government was not bound to act upon the recommendations of the Board; that matter relates to the policy framed by the Government in welfare of the Labour class, hence, the policy cannot be challenged in the writ jurisdiction in view of the law laid down in the case reported as PLD 2014 SC 01. He has emphasized over definition as provided in section 2(1) of the Sindh Minimum Wages Act 2015, while reading with section 6 and further accentuated that the sections 4&5 refer word "may" therefore, here key word is "may", which is not mandatory in nature and that is only advisory in nature, hence, the Government has rightly taken the decision while announcing minimum, rate of the wages to the tune of Rs.25,000/- per month. He has also referred the reported judgment of the Hon'ble apex Court passed in CP.No.1554-L to 1573-L of 2020 dated 26th November 2020 and the unreported judgment passed in Civil Appeals No. 429,430 and 442 of 2020 dated 20.08.2020. 10. Conversely Ms. Zehra Akbar Khan, Karamat Ali, Liaquat Ali Sahi, Jan Muhammad Khaskheli, representative of the various Labour Organizations contended that the laborers are facing miseries and there is chequered history that always employer is not ready to enhance the minimum wages. They have emphasized that there is trend of third party contractor hiring, therefore, only 15% workers are registered with EOBI and SESSI that is a gross violation; they have submitted various documents as well as contended that this announcement of the Government. shall be read as right to life as enshrined under Articles 37 and 38 of the Constitution of Islamic Republic of Pakistan 1973. 11. It is further contended that the prices of basic commodities, utilities and other expenditure have been increased many times in the last few years, which has been made the lives of the working class miserable, effect of this inflation on the workers is severe as there has been no significant rise in their wages. Besides, the above mentioned they further submitted that the owners of the factories and the commercial entities are opposing the minimum Wage of Rs.25000/- per month and have forced are forcing their workers to accept Rs.19000/- per month against Rs.25000/- per month announced by the Provincial Government; that on the contrary, the expenditures of these wealthy businessm en are more than Rs.25000/- per day which is thirty times or 300 per cent more than the minimum wages for the poor and unfortunate workers who produce wealth in the country by taking pain, and hard work. They have been also opposed the minimum wages on the pretext of COVID-19 situation, on the contrary, they received Rs.400 from the Federal Government, interest rates of which was lowered, but they even did not pay workers for the days they were unable to work. 12. Besides above submissions, it is also contended that the price of the dollar has increased from Its.130/- to Rs.168/-; that all the materials used in the production are locally produced, thus the price and incomes of the employers have been increased significantly; that monthly expenditures of the workers i.e 'rent of the accommodation, utility bills, other households, and conveyance expenditures etc. have also been increased many folds. It is further submitted that the Provincial Government has powers to fix the minimum wages that after 18th amendment minimum wages were also announced by the provincial government without the wage board approval. 13. Moreover, the Secretary, the Sindh Minimum Wages Board appeared and contended that the main aim and objective of the Act is to regulate the minimum rates of the wages and various allowances for different categories of the workers employed in different industrial and commercial organization. She also contended that there is difficulty to call meetings and make consensus as employers are reluctant to attend the meetings. She has also submitted documents pertaining to the Notification with regard to composition of the board, minutes of meetings dated 15.07.2020, 19.08.2020, 16.11.2020, 03.12.2020, 12.02.2021 and 22.04.2021, history of the Minimum Wages of Board of unskilled workers, list of 42 Industries in the Sindh Province, wherein minimum rate of the wages are to be fixed. Such documents reflect that a meeting of the minimum wages board was held on
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10.07.2020. However, in that meeting the parties failed to reach on consensus, hence, adjourned for 24.07.2020, thereafter, the meeting of the Board was held on 19.08.2020, but the same also ended with same fate. Subsequently, Working papers were prepared with regard to the scheduled meeting on 16.11.2020, being relevant the same are reproduced herewith: "WORKING PAPER FOR THE MEETING OF THE BOAR t) SCHEDULED ON 16-11-2020 1. To increase the minimum wage rates of the un-skilled workers category the Board may consider an increase of 13.81% in existing notified minimum wage rates on the basis of increase of Cost of price index in 2020 compare to 2019 as per figure provided Federal Bureau of Statistics (Flag-A). 2. As per the recommendation of increase of 13.81% in the minimum wages rates unskilled workers it would be raised up to Rs.20, 0001- per month which compare to approximately equivalent to the monthly salary of a Government employee who is appointed in BPS-1 (Flag-B) 3. As per the family Budget of 5 members (Flag-C) the minimum requirement is Rs. 32.000/- per month to incur essential expenses. 4. The Board therefore recommitted an increase of 13.81% in the wage rates of unskilled workers of industrial & Commercial establishments under section 8(2) of Sindh Minimum Wages Act, 2015. 5. To increase the minimum wage rate of the Skilled category of workers the Board may consider an increase of 20% in existing notified minimum wage rates under Section 8(2) of Sindh Minimum Wages Act; 2015 because the wage rates of skilled categories of workers have not been increased since 2 years. 6. The Board under section 8(4) of Sindh Minimum Wages Act, 2015 may consider recommending /allowing 10% adhoc relief to such workers or class of workers who qualified 5 years service and not entitle for increment in their establishments." "Calculation of increase in Cost of price index on the basis of figures provided by Federal Bureau of Statistics. C.P.I = October, 2019.126.86% C. P.I = October, 2020 140.67% C.P.I = increase by 13.81% By applying 13.81% on existing notified minimum rates of wages 17,500*13.81% = 2,417 17,500+2,417 = 19,917 (By Round off Rs 20,000/-) Therefore Rs.20,000/- per month may be considered to recommend minimum wage rates of unskilled workers." 14. Nonetheless the representatives of the workers were of the view in the meeting dated 16.112020, the minimum wages shall be at the rate of Rs.20,000/- per month, whereas, the employers demanded same wages as Rs.17,500/-, however, subject meeting was also ended with no result,, hence, another meeting was held on 03rd December 2020. Being relevant minutes of the meeting are reproduced herewith:
15. Wherein board agreed at Rs.19000 per month, as minimum wages, hence draft recommendations regarding fixation of minimum rates of all category workers were notified, which speaks that "The Minimum Wages Board has decided to 20% increase in the minimum rates of wages notified vide…
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