PLJ 2006 Tr.C. (NIRC) 280
[National Industrial Relations Commission
Present: Mr. Ghulam Nauman Shaikh, Member
SARA LEE KIWI PAK. WORKERS
versus
M/s SARA LEE KIWI
Case No. 4A (28) of 2006-K, 24(30) of 2006-K, decided on
10.7.2006.
(i) Industrial
Relations Ordinance, 2002 (XCI of 2002)--
----Ss. 49(4(e) & 25(3)--National Industrial Relations
Commission (P&F) Regulation, 1973 Regul. 32(2)(c)--Application for grant of
interim relief--Settlements, negotiation and execution thereof--Malafide
intention--Lingering on negotiations--Unfair labour practice--Petitioner union
claiming to be C.B.A. levelled allegations of unfair labour practice and mala
fide intention against the respondent company and prayed for interim relief so
as to not terminate the services of workers--Respondent company denied the
allegations and challenged the maintainability of petition--Held : Vague, bald
and general allegations, even so specific act of victimization on account of
union activities, no case made out for unfair labour practice on the part of
the respondents--Further held: Before granting interim relief Court of Tribunal
must found whether there existed a prima facie case in favour of the persons
seeking interim relief and it must also examine the concept of balance of
convenience/inconvenience and irreparable loss--Application dismissed and
prohibitory order recalled. [Pp. 290
& 291] C & E
(ii) Industrial
Relations Ordinance, 2002 (XCI of 2002)--
----Ss. 49(4)(e), 63 &
31(2)--Terminated from service--Unfair labour practice--Additional
benefits--Negotiation and execution of settlements--Maintainability of petition
and jurisdiction of NIRC--Empowered to hear only these cases where there is an
element of unfair labour practice and no general jurisdiction is confirmed upon
NIRC to entertain all kinds of grievances petitions even through they might not
be relatable to such practice. [P.
291] D
(iii) Industrial
Relations Ordinance, 2002 (XCI of 2002)--
----Ss. 3(2) & 63--W.P. Industrial and Commercial
Employment (Standing Orders) Ordinance, 1968, S.O. 11-A--Permission to
terminate more than 50% workmen and close down the whole
establishment--Relations and amicable settlements between the petitioner union
and respondent management--First time character of demands served by notice
u/S. 25(1) IRO, 2002 on the respondent company, but could not be resolved by
bilateral negotiations--S.O. 11-A--Section 63(1) deals with the criteria for
closure of establishment--Termination of employees/workmen upto 50% is neither
contravention of S.O. 11-A ibid nor it is unfair labour practice on the part of
employer under clause (1), sub-section (1) of Section 63 of IRO, 2002--Right of
employer is, heinous subject to observing the provisions of Standing Orders 12
and 13 of the Ordinance, 1968--In case the said right is exercised by the
employer improperly or illegality, it can be challenged and be made subject to
scrutiny before the proper and legal forum--It can not be curbed or curtailed
mere on general allegations of unfair labour practice. [Pp. 289 & 290] A & B
2004 TD (Lab.) 22; 2005 PLC 88 (Member
NIRC); 2001 PLC 722; 2005 PLC 327; PLD 2005 SC 53 & 2001 PLC 86, Reliance.
Chaudhry Latif Saghar, Advocate for Petitioner.
Mr. Faisal Mahmood Ghani, Advocate for Respondents.
Date of hearing : 10.7.2006.
Order
This is petition under Sections 49(4)(e),
63 and 31(2) of Industrial Relations Ordinance, 2002 read with Regulation
32(2)(c) of the National Industrial Relations Commission (Procedure and
Functions) Regulations, 1973 alongwith an application under Regulation 32(2)(c)
of the NIRC (P&F) Regulations, 1973 supported by affidavit filed by the
petitioner union (CBA) through its General Secretary against the respondents.
2. Facts of the case
as stated in the petition are that the petitioner is a registered trade union
and is certified as Collective Bargaining Agent in the respondents
establishment. The petitioner union and the management of the respondents have
been negotiating and executing settlements and an average increase of about 9%
has been allowed in cash settlement. It is submitted that the petitioner union
submitted a charter of demands on 1.9.2005 to the management of the
respondents, who with malafide intention lingered on the negotiations.
Therefore the petitioner union served a notice under Section 25(3) of IRO, 2002
on the respondents on 9.3.2005. The respondent appeared before the Area
Conciliator, sought time, but thereafter on 22.3.2006, the respondents
disclosed to the Area Conciliator that the management had filed a case under
Standing Order 11-A of the West Pakistan Industrial and Commercial Employment
(Standing Orders) Ordinance, 1968 before the Labour Court for closing down the
whole of the establishment, as such the Area Conciliator issued failure
certificate on 22.3.2006. It is alleged that the management of the respondents
establishment has planned to terminate services of all the workers numbering
62, names mentioned in the list filed with the petition as Annexure `E',
without disposal of the application under Standing Order 11-A of the West
Pakistan Industrial and Commercial Employment (Standing Orders) Ordinance,
1968, which is unfair labour practice. Further it is alleged that the respondents
have threatened to terminate each worker unless the petitioner union will not
withdraw the charter of demands and/or record no objection on the application
made under Standing Order 11-A of the West Pakistan Industrial and Commercial
Employment (Standing Orders) Ordinance, 1968 and to accept additional benefits.
It is submitted that the petitioner union has also filed industrial dispute
through an application under Section 31(2) of IRO, 2002 for an award before the
3. On presentation of
petition on 3.4.2006 interim prohibitory order was, passed, there by the
respondents were retrained from dismissing, terminating or passing any order
adverse to the employment of 62 workers, names whereof are mentioned in the
list filed as annexure `E' with the petition till next date and continued from date
to date till to date.
4. Respondents filed
reply statement with preliminary legal objections on main petition and counter
affidavit on application for interim relief filed by the petitioner. Legal
objections raised are regarding maintainability of the petition and
jurisdiction of the National Industrial Relations Commission on the grounds
that CBA can not espouse the cause of individual workers and there is no
element of unfair labour practice, as the respondents followed the process of
law by filing an application Bearing No. 1/2006 under Standing Order 11-A of
the West Pakistan Industrial and Commercial Employment (Standing Orders)
Ordinance, 1968 before the Second Sindh Labour Court, Karachi seeking
permission for termination of more than fifty percent of workmen and to close
down the factory, and that effecting retrenchment of less than fifty percent of
the workmen is legal and contracted right of the employer and cannot be
curtailed under the garb of a petition under unfair labour practice. On merits
of the petition, the respondents have denied the allegations leveled by the
petitioner. It is vehemently denied that the respondents
management has been lingering on the negotiation and did not settle the
industrial dispute with malafide intentions. It is submitted that in the past
25 years, the respondents management had always
reached amicable settlement on the charter of demands and industrial peace has
prevailed. It is submitted that there has been a gradual and substantial
decline in the income of the respondents over the years. Income considerably
dropped in the financial years 2005, for which the respondents had to take cost
control measures, by down sizing of management employees, and not replacing
retiring or resigning employees as well as with holding or curtailing yearly
increments payable to management employees to improve the bottom line. It is
due to other income generated from Defence Saving Certificates and gain on sale
of shares of listed public limited companies that the respondents have shown
profit. On these Reserves, in he form of Cash Reserves, working capital, raw
materials, market receivables the workers shall have no right or claim. It is
denied that the respondents have planned to terminate the services of all the
workers numbering 62 as per the list attached. It is denied that the
respondents have threatened to terminate each worker unless the petitioner
union withdraws the charter of demands. In reply statement filed in application
under Section 31(2) of IRO, 2002 the respondents specifically elaborated that
since the foreign share holders of the company intended to divest their
investments from Pakistan and close down the manufacturing operations, there
was no occasion for the respondents to have un-necessary lingered on the conciliation
proceedings on false pretext. It is submitted that Sara Lee Kiwi
5. General Secretary
of the petitioner union filed affidavit-in-rejoinder.
6. I have heard
arguments advanced by Chaudhry Latif Saghar learned advocate of the petitioner
and Mr. Faisal Mahmood Ghani, learned advocate for the respondents.
7. Chaudhry Latif
Saghar, learned advocate for the petitioner has contended that the petitioner is
a registered trade union, having 62 members, names mentioned in the list filed
as Annexure `E' with petition and it is certified as Collective Bargaining
Agent in the respondents establishment vide C.B.A. certificate filed as
Annexure `A' with the petition. The petitioner union served charter of demands
on the respondents, filed as Annexure `B' with the petition. On failure of
bilateral negotiations, the petitioners union served notice under Section 25(3)
of IRO 2002 for conciliation on the respondents, filed as Annexure `C' with the
petition. On failure of conciliation proceedings, the petitioner union has
taken the industrial dispute to the Second Sindh Labour Court,
8. Mr. Faisal Mahmood
Ghani, learned advocate for the respondents has contended that the respondents
company is joint venture. Its 50% shares are owned by Sara Lee Kiwi Holding
Inc. (owned by Sara Lee Corporation
9. I have given my
anxious consideration to arguments advanced by the learned advocates for the
parties and have gone through the main petition, application under Regulation
32(2)(c) of NIRC (P&F) Regulations 1973,
supporting affidavit filed by the petitioner union, reply statement with
preliminary legal objections on main petition and counter affidavit filed by
the respondents, affidavit-in-rejoinder filed by General Secretary of the
petitioner union and documents filed by both the parties. The petitioner is
registered trade union and is certified as Collective Bargaining Agent in the respondents establishment since 1981. During this 25 years
period admittedly several settlements have been executed amicably between the
petitioner union and management of the respondents, as it is not alleged by the
petitioner union that on any occasion the respondents
management had evaded to resolve the industrial dispute amicably by bilateral
negotiations. It is not alleged in the petition that prior to this the
respondents had even harassed or pressurized any of the office-bearers of the
petitioner union or victimized them on account of their trade union activities
and submission of charter of demands. It is first time that charter of demands
served by notice under Section 25(1) of IRO, 2002 dated 1.9.2005 on the
respondents (filed as Annexure `B' with the petition) could not be resolved by
bilateral negotiations. There are no allegations in the petition that during
bilateral negotiations the respondents management had
compelled or forced office-bearers of the petitioner union to sign the charter
of demands on their choice. On failure of bilateral negotiations the petitioner
union served notice under Section 25(3) of IRO, 2002 for conciliation dated
9.3.2006 on the respondents and delivered a copy there of to the Area
Conciliator, which has been filed as Annexure `C' with the petition. The
respondents company is an associated company of Sara Lee Kiwi Holding Inc
(owned by Sara Lee Corporation
"Section 63 (1): No employer or an association of
employers and no person acting on behalf of either shall--
(h) recruit
any workman during the period of notice of strike under Section 31 or during
the currency of a strike which is not illegal except where the conciliator has,
being satisfied, that complete cessation of work is likely to cause serious
damage to the machinery or installations, permitted temporary employment of a
limited number of workmen in the section where the damage is likely to occur,
or"
Obviously there is no such situation in the present case.
Admittedly after the Area Conciliator declared the conciliation proceedings as
failure on 22.3.2006, the petitioner union did not serve notice of strike under
Section 31(1) of IRO, 2002, but instead preferred to make an application under
Section 31(2) of IRO, 2002 to the Second Sindh Labour Court for adjudication of
the dispute. Therefore there is no occasion for the respondents to recruit any
workmen during the period of notice of strike under Section 31 or during the
currency of a strike, which falls within purview of an unfair labour practice.
On the contrary the respondent had already filed an application under Standing
Order 11-A of the West Pakistan Industrial and Commercial Employment (Standing
Orders) Ordinance, 1968 on 18.3.2006 before Second Sindh Labour Court for
permission to terminate more than fifty percent (50%) of the workmen and close
down the whole of the establishment.
10. Now it is
necessary to examine the import and application of Standing Order 11-A of the
West Pakistan Industrial and Commercial Employment (Standing Orders) Ordinance,
1968 and clause (i) of sub-section (1) of Section 63 of IRO, 2002, which
provisions as it is alleged by the petitioner union, the respondents management
are disregarding, which act is alleged to be an unfair labour practice on the
part of the respondents. It shall be advantageous to reproduce the same as
follows:--
"Standing Order 11-A. Closure of
establishment.--Notwithstanding any thing contained in Stating Order 11, no
employer shall terminate the employment of more than fifty percent of the
workmen or close down the whole of the establishment without prior permission
of the labour Court in this behalf, except in the event of fire, catastrophe,
stoppage of power supply, epidemics or civil commotion."
"Section 63(1): No employer or an association of
employers and no person acting on behalf of either shall--
(i) close
down the whole of an establishment in contravention of Standing Order 11-A of
the West Pakistan Industrial and Commercial Employment (Standing Orders)
Ordinance, 1968 (West Pakistan Ordinance, No. VI of 1968)"
From bare reading of Standing Order 11-A of the West
Pakistan Industrial and Commercial employment (Standing Orders) Ordinance, 1968
it reveals that it puts two kinds of bars on the employer--
"(1) that
employer shall not terminate the employment of more than fifty per cent of the
workmen, or
(2) close down the whole of the establishment, without prior
permission of the
It shall appear that above said bar (2) "employer shall
not close down the whole of the establishment without prior permission of the
labour Court" has been described as an act of unfair labour practice on
the part of the employer under clause (i) of sub-section (1) of Section 63 of
IRO, 2002, whereas contravention of its part (1) "employer shall not
terminate the employment of more than fifty per cent of the workman without
prior permission of the Labour Court" does not fall within purview of
unfair labour practice under any of the clause of sub-section (1) of Section 63
of IRO, 2002. Reliance is placed on unreported order dated 16.1.2001 in Case
No. 4A (281)/2000-K. Midway House Workers Union through its General Secretary
(CBA) versus Hotel Midway House (private) Limited (Member NIRC), Mazdoor Union
Faran Sugar Mills CBA through its General Secretary versus M/s. Faran Sugar
Mills Limited and 2 others reported in 2004 TD (Labour 22) (Member N.I.R.C.),
unreported order dated 29.9.1999 in Appeal No. 12(05)/99-L, KSSB Pumps Company
Limited, through its Director Technical and another versus Malik Azhar Mehmood
(Full Bench NIRC).
11. Admittedly the
respondents have neither terminated the employment of more than fifty per cent
of the workmen nor closed down the whole of the establishment without prior
permission of the
12. From the above
discussed provisions it is further revealed that terminating the employment up
to fifty percent of the workmen is neither contravention of S.O. 11-A of West
Pakistan Industrial and Commercial Employment (Standing Orders) Ordinance, 1968
nor it is an unfair labour practice on the part of the employer under clause
(i) of sub-section (i) of Section 63 of IRO, 2002. However the said right of
the employer is subject to observing of provisions of Standing Orders 12 and 13
of the West Pakistan Industrial and Commercial Employment (Standing Orders)
Ordinance, 1968. In case the said right is exercised by the employer improperly
or illegally, it can be challenged and be made subject to scrutiny before the
proper and legal forum. So far it is contrary established, the said right
cannot be curbed or curtailed on mere general allegations of unfair labour
practice. Reference is made to case of Shah Murad Sugar Mills Mehnatkash Union
through its General Secretary versus Shah Murad Sugar Mills Ltd. reported in
2005 PLC 88 (Member N.I.R.C.)
13. Moreover there
are vague, bald and general allegations levelled by the petitioner union and no
any specific, act of victimization on account of trade union activities of any
of the office-bearer or member of the petitioner union has been mentioned to
make out a prima facie case of unfair labour practice on the part of the
respondents. Reference is made to Amjad Mehmood versus Zonal Head, United Bank
Limited, Zonal Office Jhelum and 2 others reported in 2001 PLC 702 (Chairman
N.I.R.C.) Muhammad Shafi U.D.C., W & S Directorate C.D.A. versus Capital
Development Authority through Chairman Islamabad reported in 2001 PLC 718,
(Chairman, N.I.R.C.) and Dur Rehman versus Messrs Salfi Textile Mills Ltd.
reported in 2005 PLC 327 (Member N.I.R.C.)
14. It is well settled
that the National Industrial Relations Commission is empowered to hear only
those cases, where there is an element of unfair labour practice and no general
jurisdiction is conferred upon National Industrial Relations Commission to
entertain all kinds of grievances petitions even though they may not be
relatable to unfair labour practices. Reliance is placed on Iftikhar Ahmed and
others versus President National Bank of Pakistan and others reported in PLD
1953 Supreme Court and Malik Nazar Hussain versus National Bank of Pakistan and
another reported in 2004 SCMR 28.
15. There can be no
cavil with the proposition which by now is well-settled that before granting
interim relief, the Court or Tribunal must find whether there existed a prima
facie case in favour of the persons seeking interim relief and it must also
examine the concepts of balance of confidence/inconvenience and irreparable
loss. Reference is made to Ali Gohar and Company (Pvt.) Ltd. versus Saeed Ahmed
and 15 others reported in 2001 PLC 86 (Full Bench N.I.R.C.)
For the aforesaid reasons with reference to case law cited
above I am of considered view that the petitioner has not been able to make out
a prima facie case, and balance of convenience/inconvenience also does not lie
in favour of the petitioner and it will also not suffer any irreparable loss or
injury if interim relief is not granted. Accordingly I do not find merits in
the application under Regulation 32(2)(c) of NIRC
(P&F) Regulations, 1973, which is hereby dismissed and interim prohibitory
order passed on 3.4.2006 is recalled. To come upon 2.8.2006
for filing affidavit-in-evidence by the petitioner.
Announced in open Court.
(Zulfiqar Ahmad Sheikh) Petition
dismissed.