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Circular No. C – 172 Date:- 29 -07-2017
Enhancement of Social Security monthly wage ceiling/limit
by Govt. of Punjab to Rs. 22,000/= per month and Rs. 1000/= per day
Government of Punjab has issued Notification dated 15-6-2017, number S.O (D-II) 07-12/2014, (not yet published) enhancing the monthly wage ceiling/limit of social security from Rs. 18,000/= to Rs. 22,000/= per month and daily wage rate from Rs. 750/= to Rs. 1000/= per day. It shall apply from date of Publication in Gazette. Its salient features are given as under:––
1. After the 18th amendment of the Constitution of Pakistan abolishing the Concurrent List all subjects of the Concurrent List, including the Labour have gone exclusively in the jurisdiction of the provinces and, thereafter, the Provincial Governments have to make their own Labour Laws.
2. Several Labour Laws have been made by all the Provincial Governments including the Punjab Govt. Sindh Govt. made Sindh Employees Social Security Act, 2016 but Punjab Govt. did not make its own Social Security Law but as per section 71 (2) of the Ordinance raised the wage limit for contribution two times.
3. By Notification dated 15-6-2017, number S.O (D-II) 07-12/2014, Govt. of Punjab has enhanced the monthly wage ceiling/limit from Rs. 18,000/= to Rs. 22,000/= per month and daily wage rate from Rs. 750/= to Rs. 1000/= per day under section 2(8) (f) of the P.E.S.S. Ordinance, 1965. Daily wage rate of Rs. 1000/= per day has no sense because per day wages of Rs. 22,000/= it is around Rs. 847/= per day and not Rs. 1,000/= per day.
4. By above Notification employees whose initial wages is up to Rs. 22,000/= per month or daily wage Rs. 1000/= per day has to be covered in the Social security scheme and their 6% contribution has to be paid. If any employee once covered, he shall remain covered if his wages exceed the said coverage limit of Rs. 22,000/= per month or daily wage Rs. 1000/= per day but on the excess wages no contribution is payable. Contribution of 6% is not fixed but varies on the earned wages actually he gets.
5. Section 71 says that Governing Body and the Government shall review and modify the rates of contribution and benefits provided under the Ordinance; however the Notification is totally silent on raising the benefits of poor secured workers.
6. Previously when Govt. of Punjab had raised coverage limit from Rs. 15000/= p.m. to Rs: 18000/= p.m. or Rs: 750/= per day, It’s legality was challenged in the Const. Pet. No. 28332/2014 before the Lahore High Court, which was admitted for regular hearing along with a similar Const. Pet. No. 27503/2014 suspending the said notification dated 12-08-2014 ordered to pay contribution to the Institution as before the said amendment dated 12-08-2014. We do not know what the current status of said petitions?
7. You have to follow the above enhancement as per the maximum contribution as explained above.
For further details if required, you may consult your labour laws consultant.
For M/s S. M. Yaqoob
Industrial Relations Advisers
& Labour Laws Consultants