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Petitioner: AMIN FABRICS LTD., KOTRI VS Respondent: COMMISSIONER, AIWAN-E-MEHNATKASH, KARACHI
1998 P L C (C
1998 P L C (C. S.) 694
[Karachi High Court]
Before Raja Qureshi, J
Messrs AMIN FABRICS LTD., KOTRI
Versus
THE COMMISSIONER, AIWAN-E-MEHNATKASH, KARACHI and another
Miscellaneous Appeals Nos. 7, 9, 19, 20 and 27 to 36 of 1996, decided on 22nd January, 1998.
(a) West Pakistan Minimum Wages for Unskilled Workers Ordinance (XX of 1969)---
----Sched. [as amended by West Pakistan Minimum Wages for Unskilled Workers (Amendment) Act (IX of 1993)]---Constitution of Pakistan (1973), Arts. 25, 199 & 38---Constitutional petition---Concept of minimum wages-- Connotation.
Concept of minimum wages was and is to provide basic necessities of life, shelter and protection against starvation to the workers getting wages less than Rs.1.500 per month and any arbitrary distinction or discrimination by way of unskilled or skilled, amongst the workers getting wages less than Ks. 1,500 per month would offend against Article 25 of the Constitution, 1973. The fixation of minimum wages was further aimed to advance the concept of social justice and economic well being of workers having regard -to the directive principle of State policy as enshrined in Article 38 of the constitution 1973.
AIR 1991 SC 520; AIR 1992 SC 504, AIR 1967 SC 948 and AIR 1967 SC 963 ref.
(b) Interpretation of statutes-
---- Rule of purposive approach---Court must impute to Parliament such intention as not to impose prohibition inconsistent with objects which relevant statute was designed to achieve, though draftsman might have omitted to incorporate in express words any reference to such intention-- Title or preamble of enactment, thus, could not override clear meaning of same---In case of conflict between main body of section and heading and/or preamble, provision of section must prevail.
PLD 1992 Lah. 178; PLD 1976 Kar. 116; PLD 1968 BJ 30 and PLD 1962 Pesh. 161 rel.
(c) Constitution of Pakistan (1973)---
----Art. 2A---Interpretation of Art. 2A---Beneficial construction, rule of-- Remedial statute has to be liberally construed so as to advance remedy and suppress mischief---Where two interpretations were possible, in order to advance command regarding social justice as contained in Objectives Resolution, decision to be rendered should go in favour of upholding rights of citizens.
PLD 1991 SC 1055 ref.
(d) Interpretation of statutes--
---- Rule of construction---Primary and most fundamental rule of construction would be to ascertain in the first instance and then to give effect to real intention of law-maker---Where sense of statute demanded or where obvious mistake appeared to have been made in drafting, Courts must be prepared to supply omission therein or correct the mistake---Courts were competent to give effect to intention of legislation even if there be some omission giving rise to interpretation---Interpretation which was harmonious to intention being beneficial legislation, same was required to be adopted by Courts.
(e) West Pakistan Minimum Wages for Unskilled Workers Ordinance (XX of 1969)---
----Sched. [as amended by West Pakistan Minimum Wages for Unskilled Workers (Amendment) Act (IX of 1993)]---Constitution of Pakistan (1973), Art. 199---West Pakistan Minimum Wages for Unskilled Workers Ordinance, 1969 [as amended by Act IX of 1993] whereby minimum wages for unskilled workers was fixed as Rs.1,500---Extent---Applicability---Wesl Pakistan Minimum Wages for Unskilled Workers Ordinance. 1969, as amended by Act IX of 1993 would be applicable to all workers irrespective of categories at the minimum level of wages at Rs.1,500 per month with effect from 1-7-1992.
PLD 1991 SC 1055; 1991 SCMR 1041; 1991 SCMR 1088; 1991 SCMR 1086; 1991 SCMR 1093; PLD 1994 SC 568; 1993 SCMR 1201 and 1991 SCMR 2361 ref.
(f) Constitution of Pakistan (1973)---
----Art. 189---Leave granting order of Supreme Court was not binding in nature till final conclusion of matter by the Supreme Court---Binding force of such interim stay order could only extend to parties to proceedings before Supreme Court.
(g) Sindh Employees Special Allowance Payment Ordinance (V of 1986)---
----Preamble---West Pakistan Employees' Social security Ordinance (XX of 1965). Preamble---Both the laws i.e. Sindh Employees Special Allowance Payment Ordinance, 1986 and West Pakistan Employees'' Social Security- Ordinance, 1965. Operate in their independent and respective fields---Both Ordinances being different in their respective fields, there was no inconsistency between them.
Muhammad Humayun for Appellants (in Misc. Appeals Nos. 7 and 9 of 1996).
Khalid Habibullah for SESSI (in Misc. Appeals Nos. 19 and 32 of 1996).
Khalid Habibullah for Respondents (in Misc. Appeal No. 7 of 1996).
Date of hearing: 15th December, 1997.
JUDGMENT
By this common judgment the following appeals namely:--
Miscellaneous Appeal No. 7 of 1996 (M/s. Amin Fabrics Ltd. v. SESSI).
Miscellaneous Appeal No. 9 of 1996 (M/s. Sandoz (Pakistan) Ltd. v. SESSI).
Miscellaneous Appeal No. 19 of 1996 (SESSI v. Ghazi Tanneries Pvt. Ltd.).
Miscellaneous Appeal No. 20 of 1996 (SESSI v. Quality Knites (Pvt.) Ltd.).
Miscellaneous Appeals Nos. 27 to 36 and 32 of 1996 are being disposed.
The factual background in Miscellaneous Appeal No. 7 of 1996 and Miscellaneous Appeal No. 9 of 1996 are that the same are filed by the employees against the impugned order dated 24-12-1995 whereby the Social Security Court No.1I, Karachi had dismissed the appeal of the appellants establishment and the contribution to the Social Security Institution in respect of secured workers under the provisions of Social Security Ordinance, 1965 have been questioned by the establishment.
The factual background of Appeal No. 19 of 1996 and Miscellaneous Appeal No.20 of 1996 is that the Social Security Court No.1 had vide its order dated 8-5-1996 held that the West Pakistan Minimum Wages for the Unskilled Workers Ordinance, 1969 as amended by Act IX of 1993 is applicable exclusively and only to unskilled workers without covering other categories of workers and had remanded the case to the learned Commissioner SESSI to consider the issue of payment contribution specifically examining the categories of workers on whom the Act is applicable.
SESSI being aggrieved by the order of remand has filed the above appeals under section 64 of the Pakistan Employees' Social Security Ordinance, 1965 hence the question of differential amount of contribution sought by the SESSI has been remanded to the Commissioner to be re- adjudicated.
In Appeals Nos.27 to 36 of 1996 orders dated 25-8-1996 passed by the Social Security Court No. 1 have been challenged wherein briefly the following has been held by the Social Security Court No. l :--
(i) West Pakistan Minimum Wages for Unskilled Workers Ordinance, 1969 as amended by Act No. IX of 1993 is applicable only to the un skilled workers and other categories of workers are not covered by it;
(ii) Special allowance of Rs.250 paid/payable by the Employers to the Employees under Sindh Special Allowance Payment Act, 1986, are part of wages and Social Security contribution is payable on it.
In the above Appeals Nos.27 to 36 of 1996, the Social Security Institution has filed the same challenging only the first part of the impugned order regarding inapplicability of Ordinance, 1969 on categories of workers other than the unskilled workers. In some appeals cross-objections against the second part of the impugned orders have also been filed regarding the Special Allowance being part of wages for the purposes of Social Security Contribution.
Following are the common points of law which appear to be involved in the aforementioned appeals which were heard together on 24-11-1997, 1-12-1997, 8-12-1997, 15-12-1997 and 22-12-1997. Points of law as follows:-
"(1) Whether the West Pakistan Minimum Wages for unskilled workers Ordinance, 1969 as amended by Act IX of 1993 is applicable only to' unskilled workers or to other categories of workers also in respect of statutory minimum wages fixed at Rs.1,500?
(2) Whether the Special Allowances are part of wages for the purpose of Social Security Contribution?
(3) Whether Act IX of 1993 is applicable with retrospective effect from 1st July 1992?
(4) Whether increase under section 23 of Pakistan Employees' Social Security Ordinance, 1965 is leviable, if so, from what date?"
In order to 'deal with the aforementioned points of law it would be profitable to state that Pakistan Employees' Social Security Ordinance, 1965 is applicable to the notified establishments in respect of all categories of workers, permanent, temporary, skilled, unskilled employed therein directly or indirectly.
It was only on 10-4-1993 that Act No.IX of 1993 was published in the Gazette of Pakistan amending the West Pakistan Minimum Wages for Unskilled Workers Ordinance, 1969 with retrospective effect from 1-7-1992. Indeed at the time of this amendment on 10-4-1993, the minimum wages limit for unskilled workers under the Minimum Wages Ordinance, 1961 were as follows:--
"Punjab Rs.1,016 per month.
Sindh Rs.816 per month. '
N.-W. F. P. Rs.766 per month.
Balochistan Rs.1,200 per month."
That by Notification dated 15-10-1993, the Government of Sindh under clause (4) had clarified that the minimum wages for other categories of workers shall in no case be less than the minimum wages fixed in the schedule for. unskilled workers of Rs.480 p.m.
It would be profitable to mention that in the above Amendment dated 10-4-1993 minimum wages fixed by West Pakistan Minimum Wages for Unskilled Workers Ordinance, 1969 as per its Schedule were as follows:--
Karachi District Rs.140 p.m.
Industrial Areas Rs.125 p.m.
Other Areas Rs.110 p.m.
It would be seen that Act No. IX of 1993 was promulgated with an intent to create harmony and uniformity in the minimum level of wages. in Pakistan and thus the Federal Legislature had increased the minimum level of wages to Rs.1,500' per month in the entire territorial limits of Islamic Republic of Pakistan. Needless to mention that the concept of minimum wages was and is to provide basic necessities of life, shelter and protection against starvation to the workers getting wages less than Rs.1,500 per month and any arbitrary, distinction or discrimination by way of unskilled or skilled, amongst the workers getting wages less than Rs.1,500 per month would offend Article 25 of the Constitution, 1973. The fixation of Minimum Wages is further aimed to advance the concept of Social Justice and economic well being of workers having regard to the directive principle of State policy as enshrined in Article 38 of the Constitution, 1973. "
The case of the establishment before me, as canvassed, was that West Pakistan Minimum Wages for Unskilled Workers Ordinance, 1969 is applicable only to unskilled workers and other categories like semi-skilled and skilled workers are not covered by it. Controverting the contention of the establishments appellant, the Social Security Institution has contended before me that because the category of unskilled workers is the lowest, therefore every unskilled or skilled worker is to be benefited by this amendment without discrimination as has been guaranteed by Article 25 of the Constitution of Pakistan, 1973 which is in accordance with the concept of Minimum Wages, as no worker shall be employed at wages less than Rs.1, 500 per month.
That based on the aforementioned change in law having been brought about, the institution on examination of contribution schedule of the Employer had raised the demand to pay the differential contribution of wages paid and payable with effect from 1-7-1992 and as such notices/notice showing arrears of Social Security Contribution payable by the employers were issued. However, some employers urged re-checking of the record and production of the record, discrepancies, if any, were removed by the Institution as such increase under section 23 of .the Pakistan Employees' Social Security Ordinance, 1965 was levied in some cases only from April, 1993 and not with effect from 1-7-1992. Record further reveals that employer has disputed the payment of contribution under section 57 of the Pakistan Employees' Social Security Ordinance, 1965 to the learned Commissioner, SESSI who had dismissed their complaints. Thereafter, the employers have filed appeals under section 59 of the PESS Ordinance, 1965 before the Social Security Courts, Karachi, wherein in most of the appeals, the employers examined their witnesses without producing the original record. Such witnesses were subjected to cross-examination and contribution schedules were produced by. the Institution on which the arrears of contribution was computed. The employers have failed to prove that the a-rears of contribution as calculated were incorrect or justified but contested on the issue of liability to pay such contribution.
That the underlying concept of Labour Laws in Pakistan is two-fold. Firstly, to provide amenities of life for workers and secondly to secure the industrial peace. It is for achieving these two objectives the concept of minimum wages had come into the field in order to prevent the employment of Labour on starvation wages and to further protect the working class against the exploitations of the employers. It is with these objects that the Government in pursuance of the principle of State policy fixes the minimum rates of wages. In order to trace history, suffice it to say that it was earlier thought that minimum wages should only provide for food, clothing and shelter as the bare substance of life but with the passage of time and progress in Society nationally and internationally, this concept was modified so as to contain the provisions for food, clothing, shelter, medical facilities, educational facilities and much more for preservation of efficiency of the workers. The idea of such enlargement of scope while providing minimum wages was to increase the production which would in turn bring prosperity to the country and to ensure that no worker is deprived of their basic necessities of life. The minimum wages is a rate lowest in quantum at which the workers may legally be employed. In our society unskilled workers are the lowest class and workers in other categories i.e. semi-skilled and skilled workers are above it and are, therefore, always paid not less than what is paid to an unskilled worker. My attention has been drawn to reported judgments enabling me to state what has been stated by me in dealing with the concept of minimum wages and such judgments are AIR 1991 SC 520, AIR 1992 SC 504, AIR 1967 SC 948 and AIR 1967 SC 963. ' While dealing with these appeals, my attention has been invited to the provision of Minimum Wages Ordinance, 1961 and West Pakistan Minimum Wages for Unskilled Workers Ordinance, 1969. In the Minimum Wages Ordinance, 1961 there exists a Wage Board which recommends to the Government Quantum of Minimum Wages to be fixed. Such recommendations are made by the Board under section 4 of the Minimum Wages Ordinance in general for unskilled workers in the Province. However under section 5 of the said Ordinance, wages are fixed in particular class of Industries. Under section 6, the Government issues Notification declaring the minimum wages for such workers and it was in these circumstances that the recommendation of the Minimum Wage Board under section 4 was notified by the Government of Sindh on 15-10-1983 fixing the minimum wages for unskilled workers at Rs.480 per month and in the same notification clarification was made that minimum wages for other categories of workers shall in no case be less than the minimum wages fixed in the Schedule for unskilled workers at Rs.480 per month. With addition. of cost of living allowance these were enhanced from time to time and were Rs.816 per month in Sindh at the point of time when Act No. IX of 1993 was promulgated. Comparatively under the West Pakistan Minimum Wages for Unskilled Workers Ordinance, 1969, there is no provision for establishment of a Wage Board like is available under Ordinance, 1961. This West Pakistan Minimum Wages for Unskilled Workers Ordinance, 1969, is applicable to establishments where 50 or more persons are employed who may be unskilled or skilled. Through the amendment introduced by Act No.IX of 1993 dated 10-4-1993 in the terms wages, explanation and Schedule raising the minimum wages of Rs.140 per month to Rs.1,500 per month. Indeed definition of terms, wages, unskilled Worker, worker are also provided therein. As such wherever these words are used and/or implied in the body of an enactment, the defined meaning are to be assigned to them in order to discover the actual intention of Legislature.
Under section 8, right of making a complaint is given to an aggrieved worker which clearly mean that if any worker is paid a wage less than what is prescribed by law i.e. Rs.1,500 per month, he would then have a right to file a complaint against the employer. The intent of Legislature is that no worker shall be employed at a wage less than what has been fixed for unskilled worker or every worker shall get Rs.1,500 per month. The words "unskilled worker" and "worker" are used distinctly implying the intention of the Legislature. These words are to be given no other meaning then the meaning assigned to. them in the definition clause. Such proposition has beer, laid down in the reported judgment PLD 1986 Quetta page 148.
Modern jurists and the Courts are towards a purporsive approach and a Judge must impute to the Parliament, an intention not to impose a prohibition inconsistent with the objects which the Statute was designed to achieve, though draftsman may have omitted to incorporate to express words any reference to such intention. As such a title or preamble cannot override the clear meaning of an enactment. In case of conflict between the main body of a section and the heading and/or the preamble, the provision of the section is to prevail. I would place my reliance on reported judgment-appearing in PLD 1992 Lah. 178; PLD 1976 Kar. 116; PLD 1968 Baghdadul Jadeed p. 30 and PLD 1962 Pesh. 161. Such are the rules of interpretation.
That while applying the aforementioned rules of interpretation, I cannot close my eyes to the rule of beneficial construction which provides that any remedial statute is to be liberally construed so as to advance the remedy and suppress mischief. In the event of two interpretations being possible and in order to advance the command regarding Social justice as contained in the Objectives Resolution, the decision to be rendered should go in favour of upholding the rights of workers. While making these observations, I would safely rely on a reported judgment PLD 1991 SC p.1055,hence the Courts are empowered to draw legitimate presumption about the existence of facts on the basis of natural, reasonable and logical conclusion. Primary and most fundamental rule of construction is to ascertain in the first instance and then to give effect to the real intention of the law maker. Where the sense of the statute demands or where there appears to have been an obvious mistake in drafting, the Courts would be prepared to supply the omission or correct the mistake. Indeed the Courts are competent to give effect to the intention of legislation even if there be some omission giving rise to do interpretation. One which is harmonious to the intention being beneficial legislation the same is required to be adopted by the Courts. My attention has been drawn to an unreported decision dated 2-12-1971 of our Court in Miscellaneous Appeal No. 10 of 1967 (al-Murtaza Textile Mills Limited v. M/s. Muhammad Ibrahim and others), where under section 35 of the Factories Act weekly holidays were declared with pay. Although there was omission in the Statute in such respect. The object of fixing Rs.1,500 per month as a minimum wage for unskilled workers and the purpose behind it was that firstly workers receive an increased wage and secondly, the workers should also get Social Security, Benefits from the Institution on the basis of enhanced wages.
In view of the above any distinction amongst workers as skilled or unskilled at the minimum level of wages at Rs.1,500 per month. is totally misconceived and unwarranted by law. If it is held so then the intent and purpose of Act IX of 1993 would be invalidated and would become unconstitutional making the same discriminatory for workers having been similar situated or circumstanced. As such the true intent of Legislature cannot under any circumstances be ignored which is aimed to benefit all the workers by fixing a minimum level of wage at Rs.1,500 per month. Moreso, the right to give Social Security benefits on such increased wage is the property of a semi-skilled or skilled or unskilled worker who cannot be deprived of such property and consequently the Institution is bound to give all the secured workers benefits of an enhanced right of wage. In making the aforementioned observations, I would safely rely on the dictum laid down by the Supreme Court of Pakistan, reported in 1991 SCMR p. 1041, 1088 1086 and Hence, I would hold that the Ordinance of 1969 as amended by Act No. X of 1993 would be applicable to all workers irrespective of the categories at the minimum level of wages at Rs.1,500 per month with effect from 1-7-1992 reasons of retrospective application would follow hereinunder.
My attention has further been drawn, to the retrospective effect given by Act No. IX of 1993 dated 10-4-1993 being effective from 1-7-1992. Such issue has already been decided by the Honourable Supreme Court reported in PLD 1994 SC p. 568 wherein it has been held that retrospective operation can be given by the Legislature and merely because a particular party is burdened with certain liability in consequence of operation of law, does not mean that any of his right has been illegally infringed. Beneficial retrospective operation of law has been further substantiated in a reported judgment 1982 SCMR 1652/1972. As such the employers are liable to pay minimum wages to the workers with effect from 1-7-1992. The payable contribution is calculated on the basis of wages paid/payable in cash or. in kind. My attention was further invited to the provision of section 2(g) of West Pakistan Ordinance XX of 1969 as amended the term used as "workman" in contradiction to unskilled worker in section 3 the terms "unskilled worker and worker" are used invariably in a separate sense as defined in section 2(h)(i) and in section 8 of West Pakistan Minimum Wages of Unskilled Workers Ordinance; 1969 the term implied is "worker" and "unskilled worker" in section 2(1) "worker" has been defined to be any person employed in a commercial or Industrial Establishments. The Schedule does not prescribe any particular category of workers and being general in nature would, therefore, be applicable to every kind of worker whether skilled or unskilled. Hence the term wages as used in clause (g) would also be applicable to all the workers whether skilled or unskilled.
Upon consideration of the aforementioned, I am of the view that under section 2(5) of the Social Security Ordinance, 1965, the contribution would mean the sum of money paid by the employer to the Institution in respect of an employee in accordance with the provisions of the said Ordinance, whereas employees have been defined under section 2(8) of the said Ordinance. For the purpose of ready reference the definition of the word ' employee" is reproduced herein under:--
"' employee' means any person working, normally for at least twenty-four hours per week, for wages, in or in connection with the work of any industry, business, undertaking or establishment, under any contract of service or apprenticeship, whether written or oral, express or implied but does not include--
(a) .............................................................
(b) .............................................................
(c) .............................................................
(d) .............................................................
(e) .............................................................
(f) any person employed on wages exceeding (three thousand) rupees per mensem: (provided that an employee shall not cease to be an employee for the reason that his monthly wages exceed three thousand rupees:)"
That as contributions are to be made by the employer on the wages of an employee, a reference to the definition of wages under section 2(30) of the Social Security Ordinance, 1965 would be necessary which for the purposes of ready reference is reproduced hereinunder:--
"(30) 'wages' means remuneration for service paid or payable in cash or in kind to a secured person, not being less than remuneration based on the minimum rates of wages declared under the Minimum Wages Ordinance, 1961 (XXXIX of 1961) without taking account of deduction…
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