The Dilemma Of Labour Laws In Sindh

The Dilemma Of Labour Laws In Sindh

The 18th Constitutional Amendment was passed in April 2010 with the aim of providing more autonomy to the provincial governments of Pakistan. This change received confidence and immense support from most of the political parties as it met some of the long standing demands of the provinces. These demands included making themselves dependent in terms of getting more control over provincial resources, finances and revenues. As a consequence, 17 ministries (education, social welfare and special education, tourism, special initiatives, population planning, local government and rural development, zakat and ushr, youth affairs, livestock and dairy development, culture, food and agriculture, sports, environment and health, women development, minorities affairs, labour and manpower) were abolished at the federal level in 2011 and their entire responsibilities were transferred to the provinces.

The prolonged political and provincial grievances became the root cause for the historical constitutional move that in the previous federal government’s attention was inadequate to the transferred sector. The devolution was a means to bring good governance in these sectors closer to the people in order to promote intense development. In the process, key areas were transferred to the provinces, such as labour, health and education. In most developed countries these areas fall under federal governance, but in Pakistan these were transferred after the 18th Amendment, exclusively into the provincial domain. This step was taken without the appropriate consideration of its effects and due to this the provinces are still facing issues on these matters and plenty of legal complications and complexities still exist.

The post-18th Constitutional Amendment era has created a situation where federal laws are contradicting with provincial laws, especially labour laws. After the devolution of labour laws from the concurrent list, the justice system of this area seems to crawl at a snail’s pace. Investors, industrialists and labourers are all facing the slow pace of justice due to the conflicts in federal and provincial laws.

From the perspective of the 18th Amendment, the federal government is reluctant to transfer the responsibilities of some important institutions, like the Employees Old Age Benefit Institution (EOBI) and the Workers Welfare Fund (WWF) to the provinces. This reluctance is due to several factors, but mostly because of the provinces’ shortcomings in building their capacity to handle such socially important issues. From the perspective of the labourers, a key institution like the Employee Old Age Benefits Institution (EOBI) should remain within the federal ambit in order to continue disbursement of pension to poor workers from all over the provinces. If EOBI does transfer into the provincial ambit, pensioners from all over the provinces will suffer. For example, if a worker belongs to the province of Punjab but works in the province of Sindh and his or her contribution goes from the province where he is working, then in that scenario how will that worker get pension from the province of Punjab when he or she reaches the age of superannuation? The province of Punjab will refer that worker to the province of Sindh to get pension where he or she worked and the worker will suffer a lot to justify that pension in hard times when he or she will have no earning except this pension amount.

The Sindh Government in view of 18th Constitutional Amendment promulgated the Sindh Employees Old Age Benefit Act 2014 and repealed the federal law of employees old age benefit. The Sindh government did not consider the the merits and demerits of the law or focus on the after-effects of this move. The move seems to only generate more revenue for the province of Sindh. After said enactment, most of the industrialists have stopped contributing to the federal Employee Old Age Benefit Institution and some industrialists also went to court against the promulgation. The Sindh government has still not established practical methods to help its Sindh Employees Old Age Benefit Institution function more effectively. The government merely makes law on paper and does not give consideration to its implementation, so industrialists and workers end up suffering a lot.

Furthermore, the Sindh government has also promulgated the Sindh Workers Welfare Fund Act 2014 in haste and repealed the federal Workers Welfare Law. Most of the industrialists from the province of Sindh went to Sindh High Court and got injunctions against the newly promulgated law – the issue being whether they should submit their 2% profit, as per requirement of the law, to the federal or provincial government. This has resulted in billions of rupees being held with the Nazir of the court till the final verdict is given. Industrialists are also facing many problems in compliance with the Federal Board Revenue (FBR), in their closing return, to show 2% mandatory submission of profit to the federal government through FBR. The provincial government has been focusing on legislating more financial laws instead of providing solutions and remedies to the existing laws.

Complexity of jurisdictions is also an issue in labour-related cases in all provinces. Many employers have challenged the applicability of federal laws to the provinces, as the provincial governments have not yet brought about the relevant changes in the labour laws as required by the 18th Amendment. In the law of industrial relations, the term “trans-provincial” (meaning the existence of establishment in more than one province) has made the situation worse. Those cases that went to provincial labour courts prior to the Industrial Relations Act 2012, are now transferred to the National Industrial Relations Commission (NIRC). All across the provinces, hundreds of thousands of cases have been transferred to NIRC from provincial labour courts. The judicial forum of NIRC bench consists of a smaller bench and is meant to dispense speedy justice, but instead, justice has become more delayed and most of the litigants use the term “trans-provincial” as a delaying tactic to further suppress the aggrieved party.

The Sindh government has legislated almost 11 labour laws uptil 2016, after a prolonged waiting period post-18th Amendment, while several other labour laws are still waiting in queue. The irony is that the majority of laws have legal lacunae and blunders such as quoted repealed law references instead of new enactments. Every promulgation need not be done in haste as it creates confusion and complexity, which is surely not the purpose of the law being promulgated. Before processing legislation, there should be a focus on the after-effects of promulgation and the law should be written in a simple manner. The law should be for the convenience of the people and labour laws should especially be easy to understand as they are seen as welfare laws, therefore access to rights and speedy justice must be the ultimate aim.


The views expressed in this article are those of the author and do not necessarily represent the views of or any other organization with which he might be associated.

Asif Amin

Author: Asif Amin

The writer is an Advocate of the High Court and works on civil, commercial, industrial relations and employment matters. He is also a visiting lecturer at the University of Karachi and can be reached at [email protected]