Legal Principle & Question Decided

Ruling Summary: This decision was rendered by the Sindh High Court, officially reported as 2024 SHC 225. In this matter between Const. P. 289/2024 (D.B.) Sindh High Court, Bench at Sukkur - Engro Fertilizers Limited through Asad Shakil Khan (Petitioner) and the Respondent, the court adjudicated key questions of statutory construction, procedural regularity, and legal precedent under Pakistani law.

Core Holding: The honorable bench evaluated governing statutory provisions and judicial authorities to establish the rights of the parties, delivering the binding reasoning set out below.

Full Judgment Text & Judicial Ruling

COURT: Sindh High Court CASE NO: Const. P. 289/2024 (D.B.) Sindh High Court, Bench at Sukkur CITATION: 2025 SHC SUK 225 PARTIES: Engro Fertilizers Limited through Asad Shakil Khan (Petitioner) ORDER DATE: 04-FEB-25 BENCH: Hon'ble Mr. Justice Adnan-ul-Karim Memon(Author), Hon'ble Mr. Justice Muhammad Abdur Rahman A.F.R: Yes ------------------------------------------------------------ II] IN THE I{IGI{ COURT OF SIND}I Bench AT SUKKUR. Constitutional petition No. D_2gg of2024(Engro Fertillzer Linrited v Fut Be,rch ofNlRC & others ) Constitutional petition No. D-2g9 of 2024(En8ro Fertilizar Limited v Ful Bench ofNIRC & olhers ) Constitutional petition No. D-290 of2024 E Ierti,izer L,mited v Ful Bench of NIRC & orhers N4r. Justice Adnan-ul-Karim Memon Mr. Justice Muhammad Abdur Rahman Date of hearing:- Date of judgment; 23.05.2024 a9_.02.202s Mr. Faisal Mahmood Ghani advocate for the petitioners.Mr' Jaffar AIi Shah advocare for respondents'N".'ii" I i, c.p. No. 2g9 0f 2024.Mr. Jamshed Ahmed Faiz advecate ior."spond"nt. iVo. : arO C.Mr. Abdul Hafeez Irfan advocate for respona"nt No. ii, C.r, No. D_2g9 of 2024 .I UDGM ENT Adn -rxl nime Me @m All captioned petitions, sharing common legal and factual issues, need to be disposed of through this single judgment. 2. The case of the petitioner company is that the petitioner company, a fertilizer manufacturer with operations across Sindh and punjab, conducted a review to improve efficiency and resource arocation. This led to organizationar restructuring to enhance career growth and adapt to upgraded production processes, this involved abolishing Group ,,F,, (60 employees) and promodng Group "G" (56 employees). Four employees from Group ,,G,, accepted voluntary separation schemes. As per the company, the private respondents cannot object to these agreed-upon changes under the guise of unfair rabor practices as such three grievance Petitions were filed before a Singte Bench of the Nationar Industrial Relations Commission, (I.{IRC), including by Reipondents 3 & 4 inC.p. No. D- 288 of 2024, challenging a completed promotion. Despite this challenge, Respondents 3 & 4 were already serving in the promoted roles and receiving corresponding salaries Notice was issued on the main grievance petition and stay application. The petitioner company filed preliminary legal objections, with a reply statement and counrer affidavit, along with an application for a hearing. Evidence was led by both parties. Respondents 3 and 4 also testified. eurban Ali, Deputy Manager of Industrial Relations, authorized by the Board of Directors of the petitioner company was examined. The parties presented their evidence and ents heard. The learned Single Bench of NIRC allowed the grievatrce tions vide imp d order dated 20-09-2023. The petitioner company filed ppeals No' 124(08)/2023s, rz{(09)r2023S, and r2A(r0)rzo2r-s. before the Date ture of .l SOrder with s I Bench of NIRC challenging orders dated 20-09-2023 issued by the learned

t2l Single Member of NIRC in grievance cases No. 4B(28y21-S and 4B(29)/21-S. However, these appeals were dismissed by the Full Bench of NIRC via an impugned order dated 25-01-2024, and as per the petitioner company, which misread and misapplied the evidence and ignored settled law, thus are liable to be set aside. 3. leamed counsel for the petitioner-company argued that no grievance notices, which is condition precedent under section 33(l) ibid have been served by respondents No 3 & 4 upon the petitioner company; he emphasized that respondents 3 & 4 admitted during cross-examination that they failed to serve a grievance notice upon the petitioner, which was outside the scope of Section 33 of Industrial Relations Act (IRA 2012). This renders the grievance petitions non- maintainable. Per learned counsel, the grievance petitions were/are not maintainable under Section 33 of the IRA 2012 as this section allows grievance pelitions only for enforcing rights guaranteed under 'law,' 'award,' or 'settlement.' Per learned counsel, the grievance petition is only valid if it relates to a right guaranteed by law, settlement, or award. He added that even if the private respondents are considered workmen, their grievance does not fall under any legally guaranteed right. Learned counsel argued t}rat respondents 3 & 4 accepted their promoted salaries and positions, implying acquiescence. This conCuct renders the grievance petition inadmissible due to acquiescence and the law of estoppel. He emphasized that respondents 3 & 4 admitted during cross- examination that Engro Fertilizers management reclassified them from Grade F to management grade P-6. Per learned counsel, the NIRC erred in stating that the petitioner failed to produce job descriptions, thoughjob descriptions were filed as an employee cannot insist on remaining in their current role and refuse a promotion. Leamed counsel next argued that the petitioner company reviewed operations to optimize costs and ensure a sustainable manufacturing process for the company, this involved analyzing resource allocation, deployment, and utilization, along with process efficiency and effectiveness. Per learned counsel, to shape career grouth and drive efficiency, the petitioner company restructured its organization, this aimed to create an agile and skilled workforce equipped to manage upgraded production processes. Leamed further added that respondents 3 & 4 were performing supervisory and managerial duties as their primary function. This included responsibilities like hiring, promotion, demotion, transfers, discipline, and determining employee requirements. He pointed out that manual work, if any, was ancillary, alter promotion, respondents 3 & 4 received benefits in the management cadre, as such they cannot file grievance petitions before the se included increased salary, 12 air tickets per year, access to then management Club and School, enhanced end-of-service benefits (including vident fund), and improved medical coverage. Per learned counsel, their last

l3l pay slips show gross salaries of Rs.407,169/- and Rs.634,575/- respectively, this includes benefits in the management cadre and an inflation increment. He argued that the Single Bench of NIRC erred in Para 7 by failing to determine, how the promoted posts became vacant (freshly created, retirement, promotion, etc.). Per leamed counsel, the parties previously agreed to a Memorandum of Understanding (MoU) for the period January 1, 2021, to December 31,2022, which became part of the Memorandum of Settlement. This MoU contains Section 3 outlining the agreed-upon terms. He submitted that promotion is an agreed right, covered by the settlement agreement, Per leamed counsel, the respondents cannot object to agreed provisions, especially under the guise of unfair labor practices based on promotion posts. He further argued that the settlements between the employer and CBA are binding on dissenting workers. Learned counsel submitted that respondents No. 3 & 4 during their cross- examination admitted that the MoU dated 05.10.2021 attached with Affidavit in Evidence signed between management and union from 01.01.2021 to 31.12.2022; He referred to clause I of the MoU contains rights of CBU (CBA) union and management. He argued that the NIRC's finding that workers can forego promotions and that the settlement lacks provisions for promotion beyond Grade F strongly suggests that Grade F is the terminal point in the workers' grade structure. He added that promotion is not an unfair labor practice, as such, the grievances petitions lack specific instances ofl unfair labor practice and were/are, therefore, not maintainable; that the Single Bench of NIRC ened in finding that the promotion was malicious and intended to suppress union activities. Leamed counsel argued that there is no legal requirement for consent or consultation lor promotion as promotion from Grade C to F is permissible under the CBA. Per leamed counsel promotion to P-6 (Management Cadre) is valid as promotion is not based on malice or dissatisfaction. Besides transfer is a normal part of employment. Since Engro Fertilizers Ltd. is the proper legal entity such a Grievance Petition filed without following proper procedure was/is not maintainable. ,A petition filed by a provincially registered union for a trans- provincial establishment is not maintainable. On the question of concurrent findings of facts and law by the NIRC, he argued that concurrent findings can be overtumed if based on the application of incorrect [aw. Petitioner's affidavit in evidence was not challenged, creating a presumption of its acceptance. He argued that since there is no specific law regarding promotion in the Standing Orders, and promotion is not a guaranteed right, the grievance petition ought to have been dismissed in terms of the ratio of the judgments rendered in the cases of Liaquat Ali v. Manaoi Director Sui Northern Pipelines Ltd.,2009 PLC 79 IS vant to the current grievance petition. In support of his contention he relied upon the il 1992 SCMR.36, Liaauat Ali v M/s Sindh Labour Aooeliate of Karachi Pipe Mills emolovees Union Karachi v Karachi Pipe

t4l Tribunal Karachi & others n993 FLC 1,09, Munnawar Hussain v MCB Ltd. Fl,J 2006 Lahone 1130, Zar Khan v Senior Vice Presiclent' Muslim Commercial Bank Ltd. & others [984 PI-C E9 re Mana s/, Dhome I Pakistan td and others v The Chairman Firsl bour Court East Pakistan & others 191'X, PLC 406, Sved Muhammad Hussain v Pakistan Tobacco Co Lld and others PID 1980 SC E0, Attied Bank o! Pakistan Workers Union v Allied Bank Ltd. Emolovees Unio &others 2$AG P[-C 30E o Ho Khan & others 2A2L PLC 148 PIA Corporation v Sved Suleman Alam Rizvi & others 2015 SCMR 1545, Mukhtar Ali v Pakistan Railways and others 2005 PLC 166, ssers Inter boratorie PLD [975 Kanactni 279, unreportecl order pdssed in Ctuil Aooeals No. 481 of20l7 & 913 and 914 of 2020 passed by Suprenne Court of Pakistan and another unreported order in Civii Petilion No. 34 of 2022 parised on 30.01.2024, Muslim lll rcial Limite izwan Ali Khan 2024 SCMR 350, United Bank Limited v Jamil Ahmed and others 2024 PLC 5A, Muhammad Sha-fi @ Kuddoo v The State 2019 SCMR 1045, Ufilirv Sbre Cofporation of P stan Limited v Puniab bour Appellate Tribunal & others PX-D [987 SC 447, Muhammsd Nawaz v Member Judicial Board and others 2014 SCMR 9X4, Muslim Commercial Bank Ltd v Muhamma Riaz Jurt FII-R. 20[0 109 and Muhanmad Akhtar v Manna 2004 SCMR 974. He lastly pmyed for allowing the instant petitions by dismissing the grievance petitions filed by the private respondenls. 4. Mr. Jamshed Ahmed Faiz, advocate for respondents No' 3 and 4 in C'P' No. 289 of 2024, referred to the objections filed by the respondents and argued that on September 20,2023, the NIRC set aside an order dated October 5,2021, that forcibly converred the private respondents from their technical Grade-F positions to lower-ranked management positions (P-6). He further submitted that the respondents were improperly treated by the petitioner company just to knock them out ofservice so that they may not be able to file a grievance petition against the highhandedness of the management of the petitioner company. As per counsel, this treatment violates a 2021 Memorandum of Settlement that does nol allow for such conversions from workmen to management cadre positions' He further argued that their Grade-F positions are the highest in their technical field within the petitioner company, however, the petitioner company acted arbitrarily and against labor laws by reducing their salaries and forcibly converting them just to knock them out of the category of the workman to create a ground to remove them from services, therefore they were compelled to approach NIRC to have October 5, 2021, the order passed by the management set aside with the declarati o their forced conversion was/is unlawful and illegal and an nting the petitioner company from further implementing theinjunction order order dated October 5,2021. He further argued that the settlement agreement

t5l dated 01-01-2021, being statutory, only includes payscale A and F, for workmen and the Memorandum of Settlement dated 0l-01-2021 does not include any provision for converting technical employees into non-technisal roles. He emphasized that on October 5,2021, the respondents were forcibly converted to Grade P-6 (Senior Plant Operator) from Grade F. This contradicts the Memorandum of Settlement, which classifies Senior Operator as Grade E. The petitionff company's classification also deems the management grade (p-6) inferior to the respondent's previous position in Gmde F. Moreover, the Memorandum of Settlement lacks any procedure for converting Grade-F employees into the management cadre. The intention of the petitioner company, through the impugned promotion/conversion order, was/is to remove them from service with malafide intentions. He further contended that the present petitions are not maintainable, as NIRC (.,lational Industrial Relations Commission) has rendered concurrent findings of fact, which cannot be challenged through writ jurisdiction. On the point of service of grievance notices, upon the petitioner company, he argued that earlier one of the respondents filed grievance petitions under Section 54(e) ofthe IRA,2012, seeking an injunction against the petitioner company from altering their employment status. The Single Member NIRC Sukkur dismissed the grievance peritions, ruling that section 54(e) did not apply to individual grievances. The Single Member directed the respondents to invoke Section 33 of the IRA, 2012, for individual grievances after exhausting internal grievance procedures by serving the petitioner company. They supported the impugned ordets passed by the learned NIRCs. He concluded by praying for the dismissal of the captioned petitions. 5. Mr. Jaffar AIi Shah represents respondents 2 to 4 in C,p. No. 28912024 and Mr. Abdul Hafeez Irfan represents respondent 3 in C.p. No. D-289/2024 has adopted the arguments ofcounsel for respondents 3 and 4 in C,P No. 288 of 2024. 6, At this stage counsel for the petitioner company by exercising the right of rebuttal submitted that the respondents' claims were previously dismissed by NIRC, and they cannot re-litigate the same issue (estoppel and res judicata). He added that the company restructured to improve efficiency and reduce costs, including offering VSS (which the respondents declined). He argued that there is no legal right to promotion under the relevant labor law (lndustrial and Commercial Employment (Standing Orders) Ordinance, 1968). As the respondents are now in management positions, they are no longer covered by the Standing Orders; that the petitioner company has the right to promote employees existing Memorandum of Settlement. He lastly submitted that the respondents the promotion and are currently working and receiving a salary in the promoted position

t6l 7. We have heard the leamed counsel for the parties and perused the record with their assistance and case law cited at the bar. 8. Petitioner Engro Fertilizers Limited company calls the orders dated 25.01.2024 passed in Appeat No.12A, (09y2023-S by Full Bench ol NlRC'/Respondent No. I and on 20.09.2023 in Case No.4B(30)/2021-S by /Single bench of NIRC. The reasoning of the learned full bench of the NIRC is that the petitioner company retains all management rights, including the right to direct and control its workforce. This includes hiring, promoting, demoting, transfening, disciplining, discharging employees, and determining staffing needs. In the petitioner company position classifications exist from Grade A to Grade F, which outline pay rights with grades ranging from A to F, Upon reaching the maximum salary within a grade, a salary revision may be considered. However, the Memorandum of Settlement lacks provisions for promotions beyond Grade F, suggesting that Grade F likely marks the highest attainable grade for workers, with potential advancement into officer positions thereafter. It was further observed that the petitioner's counsel failed to provide information on the company's profile when questioned by the NIRC Bench. Additionally, he could not provide evidence regarding the abolishment of Grade F, including any s€ttlement agreement with the CBA, relevant orders, or notifications. This demonstrated a lack of preparedness on his part. The petitioner company claimed that all employees in Grade F either accepted a promotion or filed grievances, effectively ending the grade. That factum lacked documentation for the grade,s abolishment. While he showed a salary increase with the promotion to p-6, he couldn't provide salary data for other employee classes to compare inflation- related raises. The petitioner company had the right to decline promotion, and no worker can be compelled to accept it. It was further observed that the petitioner,s counsel failed to demonstrate any misinterpretation of evidence by the Single Member of NIRC to justif) the Full Bench's intervention. Consequently, all thee appeals filed by the petitioner company were dismissed as meritless. 9. The questions involved in the present proceeding, for determination, are whether the petitioner company can convert the status of the respondents/workman to officer category by promoting them to p-6 gtoups and whether a grievance petition can be filed under section 33 of the Industrial Relations Act 2012, based on unfair labour practice. 10. There is no dispute that petitioner company vide order dated 05.10.2021 p oted the however, private respondents from Grade F to P-6 management cadre, romotion has been objected by the respondents leading to filling of grivence petitions before NIRC, on the premise that this anangement was/is against their desire and consent.

t7l 11. This issue has been addressed by the leamed single bench of NIRC on the premise that the respondents' conversion/promotion order dated 05.10.2020 was invalid due to salary reduction and no overtime as these are significant detriments in the converted position. Besides petitioner company failed to provide clarity on the new role as the origin of the vacancies remains unexplained. Additionally, the "P-6" position waVis not recognized in the Management Cadre. Lastly, the conversion was/is a punitive measure against trade union activities. Thus the grievance petition was allowed, and the order dated 05.10.2020 was set aside. An excerpt whereof reads as under:- " I have heard the arguments of the learned counsel for both parties and perused lhe record. It is very strange thal pelilioners' salaries are decreased in a conversion/promoliott position, it is also worth mentioning lhat overtime is also not allowed in the above-said conversion) position, moreover, the respondents failed to produce job description of the converted/promoted position. The respondenls were unable to explqin how the conve ed/promotion posl became vacant, or v)helher lhese posts were freshly created or lhey became vacan! due to lhe retiremenl or promotion of incumbents. According to the Memorandum of Seltlement, the last top position or grade is F-Grade and there is no mention of the P-6 position in the Managemenl Cadre. Moreover, the petitioners never wanted this position and they are not availing the perks and privileges of the P-6 is a self- created posilion to punish the entployees, and they should not take part in trade unionism. The employees that they should not take part in trade unionism. The employees, that they should not lake part in lrade unionism, The conversion/promotion ol the petitioners was based on malafide intention of lhe respondents to deprive the petitioners of the status of worbnen, in fact, they wanted to curtail/restain their trade union activities. Therefore, the instant petition is allowed and lhe order dated 05.10.202 is set aside, wilh no order as cost. File be consigrcd lo record room- 12. The full bench ofNIRC endorsed the findings ofthe single bench ofNIRC vide order dated 25.01.2024 on the following premise:- "5. The learned counsel for the appellant while orguing his case submitted and reilerated in his arguments all the facts which he reiterated at the time of submission of written reply. On the olher hand, learned courcel for the respondenls supported the impugned order and requested that oll three appeali be disnissed. While gcting tfuough the Memorqndum of Settlement in Section 3 lhe respondent as well as the Employee Union agree on rhe following: "The company retains all rights of management resulting from ownership of the Company and perlaining to lhe operalion of business. These rights shqll include (a) the right to direct and control the workforce i.e. Among olhers lhe iSht to hire, promote, demote, lrarc/er, discipline, discharge, lo creale to discontinue, or reclassily jobs, to delermine lhe number of employees needed" and the Memorandum of Settlement is also attached with position classifrcation and starting lrom Grade-A, Crade 8, Grade-C, Orae-D, Grade-9, and Grade-F. The rights of pay as per Section 6 is in the qltached ATTACHMENT 'A'. The pay group slarls and ends at Crade F and if a worker reaches on sealing of his grade basic salary the sealing may be considered for revision. Nowhere in the Memorandum of SetlemenL it is permitted that the worker class lo reach Orade how will be prornoted it meqns I the Eradalion of the workers class comes to an end qt Crade F aad fro*

i t8l probably onward in officer class. However, when during the arguments we posed a question to the learned counsel for the appellant to appraise abofi the agrogram of the company he could nol satisfy the Bench in this respect. Moreoyer, when he was asked whether Grade F is abolished whether there is any agreement of Settlemenl redched bet, een the CB And the company in lhis respect, and whelher any order/notilication hqs been made in respecl of abolishing Crade F he was unable lo bring dny letter show his ignorance in this respect. Though he pleaded that the total strength in Grqde F is 60, 04 out of 6A opted for VSS 48 accepted promotion and the remaining 8 filed grievance petitions, qnd thus the vthole group cqme lo an end. He is unable to show any document qboul the abolishment of Grade F, he also provided the breakdown in this respect of the salqry the petilioner used to recehte in Grade F and will receive in P-6 and pleaded that lheir salary is nol reduced bul ralher enhanced. However, when he was asked that the raise in ,he salary due the inflation would also be received by the workers class of the company as well as the ofiicer class, he was unable lo show w lhe salary of both classes. 6. Admittedly the petitioners had the right to forgo their promotion and no worker can be forced for promolion. Moreover, the learned counsel for the appellant failed to point out any misreading and non-reading of documentary evidence by the learned Single Member to warranl the interference of this Bench, therefore, all the above-menlioned three appeals around meritless stand wele dismissed. No order as lo cosr. The Jile be consigned to the record room after due completion. " 13. Keeping in view the above factual as well as legal findings, in such circumstances, the High Court has the power only to issue a writ of certiorari to review NIRC decisions based on a misreading of evidence or jurisdiction error; as the scope of judicial review of the decisions as discussed supra is limited. This court generally does not interfere with concurrent findings of fact unless there's evidence of Jurisdictional erors, errors of law, manifest injustice, and violation of principles of natural justice which factum is missing in the present case. 15. Coming to the proposition so forward by the petitioner company that the issue of promotion in a company cannot potentially be agitated in the National Industrial Relations Commission (NIRC) based on unfair labor practice. The concept of unfair labor practice refers to actions by employers or employees that interfere with, restrain, or coerce employees in the exercise of their rights. These rights may include the right to organize, bargain collectively, or engage in other concerted activities for mutual aid or protection. Promotion may be considered a right if it is explicitly stated in a collective bargaining agreement or licy. If the employer denies promotion based on discriminatory or retaliatory motives, it could be considered an unfair labor practice. For unfair labor practices based on promotion denial, the parties need to present evidence the decision ofthe company was based on discriminatory factors such as race, 14. On the issue of concurrent hndings, ifboth a single bench and a full bench of the NIRC have reached the same conclusion on a matter of fact, it carries significant weight then the High Coun will be hesitant to overturn these findings unless there's a strong case for one ofthe exceptions…

Read the unabridged text and precedent citation network on Al Wakeelo Legal Research Platform.

Related Legal Research & Directories

• Browse all judgments from Sindh High Court
• Search Pakistani statutes: Constitution of Pakistan 1973, PPC, CrPC, CPC & Family Laws
• Analyze this case with Al Wakeelo AI Legal Assistant