The Industrial Relations Advisers,
Management & Labour Laws Consultants
Room 3, 1st floor, Falaknuma
Building, Near The Laboratory & Haroon Radio, Abdullah Haroon Road,
Phone: 2727266 & 2729770 Fax:
2729770 (S M Iqbal) Email:
NEW LABOUR POLICY, 2002
Principles, Aims and
Fundamental rights concerning labour as laid down in the
Constitution of the Islamic Republic of Pakistan and international labour standards
as enunciated in ILO Conventions ratified by Pakistan
provide necessary framework for evolving a sound and stable mechanism for
ensuring core labour rights. The labour laws and the system of labour
administration in Pakistan
will thus be brought in conformity with these standards to meet national
objectives and international obligations.
The traditional environment of mutual antagonism
and mistrust between employers and labour has adversely affected investment,
business profitability and growth, all of which are crucial elements for
ensuring security of employment, decent wages and social security for the
The government keenly feels the need to foster an
employer-employee relationship based on trust and partnership. For this
purpose, the Labour Policy aims to enhance the required social dialogue between
the labour and employers by facilitating and nurturing bilateral mechanisms for
negotiations and mutual co-operation.
The creation of WEBCOP (Workers and Employers Bilateral
Council of Pakistan) by the enlightened employers and labour leaders of Pakistan is a pioneering effort,
and a positive development in this respect. The government fully supports this
initiative and will promote steps, which aid such efforts. The regulatory
authority of the government will be exercised only when bilateral mechanisms
are demonstrably unable to resolve conflicts and issues.
Bilateral Codes of Conduct
The government as a facilitator shall persuade
workers and employers' organisations to evolve bilateral codes of conduct at
the level of enterprise and industry, which should lay emphasis on: (a) respect
for reciprocal rights and obligations of both the parties; (b) communication
between management and CBA and (c) enhanced confidence in union to play
positive role in organisational performance.
Consolidation of Labour Laws
The existing voluminous labour legislation is
overlapping in its coverage in several areas and anomalies in definitions and
scope. The variety and complexity of labour laws has contributed adversely to
industrial relations system. There is, therefore, the need for
rationalisation/consolidation of the existing laws. It is proposed to simplify
and consolidate these laws into following six basic laws:
Industrial Relations Ordinance
Conditions of Employment Ordinance
Human Resource Development Ordinance
Occupational Safety and Health Ordinance
Labour Welfare and Social Protection Ordinance
Promotion of Healthy Trade Unionism
Healthy trade unionism based on freedom of association and
an effective collective bargaining system is a prerequisite f or industrial
peace, productivity and socio-economic uplift of labour. An environment for
growth of healthy and responsible trade unionism will be created by encouraging
responsible and representative trade unions.
Strengthening Social Dialogue Mechanism
The system of bilateral and tripartite social dialogue
shall be strengthened and streamlined to promote industrial peace and harmonious
Labour Judicial System will be restructured, simplified,
and minimised to provide speedy justice.
Social Safety Nets
Institutions responsible for social protection, social
insurance and labour welfare need to be made fully autonomous and effective by
restructuring their respective management boards to ensure adequate labour and
employer representation and to strengthen their tripartite character.
Policy-making, co-ordination, and monitoring of the functioning of these
institutions will be entrusted to these tripartite boards exclusively.
Elimination of Gender Discrimination
There is a need to improve the role and contribution of
women in the labour force and to provide them equal opportunities for employment.
The work places will be made conducive for women workers. The principle of
equal pay for work of equal value has been adopted with the ratification of ILO
Convention 100, to promote gender equality in terms of the pay/wage system.
Workers' Children Education
The existing unjust two-tier system of education in the
country has created a system of apartheid in society, wherein, the children of
low-income groups are effectively deprived of access to good quality education
thus preventing uplift of the deprived classes. Workers Welfare Funds and
Education Cess Funds will be utilised to establish quality educational
facilities in all district of the country for providing free education up to
metric and intermediate levels to workers' children. Also, a system of merit
scholarships for higher education will be put in place.
Elimination of Child Labour and Bonded Labour
Targets and activities set out in the National Policies
Action Plans to Combat Child Labour (May 2000) and for Abolition of Bonded
Labour (2001) need to be actively implemented. Additionally, Pakistan,
by ratifying ILO Convention 182, has accepted the obligation to enhance age
limit to 18 years in respect of worst forms of child labour, for entry into the
Challenge of Globalisation
Globalisation is a challenge for the developing countries.
An inter-ministerial committee shall be formed to address issues such as social
accountability, arising out of globalisation.
Labour Welfare Levies
Different channels are operating at present for collection
of labour welfare levies and distribution of corresponding benefits to the
employees. Measures will be taken to streamline collection of levies and
distribution of benefits to save both workers and employers from inconvenience.
Section 2-A and 27-B
Section 2-A in the Service Tribunal Act, 1973, excludes
the workers in public sector from the purview of labour laws/labour courts.
Section 27-B in the Banking Companies Ordinance, 1962, prohibits a non-employee
to hold the office in the executive of a trade union. These provisions have
been resisted by the workers and their organisations. The government will
address the legitimate concerns of all stakeholders.
Human Resource Development
In order to meet the challenges of a globalised economy,
an educated and skilled labour force has a critical role to play. There is an
urgent need to strengthen programmes of workers training in new and multiple
trades for facilitating entry in the labour market; both nationally and
internationally. The role of Skill Development Councils (already established)
shall be strengthened in this context.
Occupational Safety and Health
safety and health of labour is required to be given the highest priority. A law
covering all workplaces will be enacted and a National Tripartite Occupational
Safety and Health Council will be established to meet the objective of
providing adequate safety and ensuring compensation to workers.
Research in labour related disciplines and labour
administration training is necessary for improvement of the system and
up-gradation of the personnel. Measures shall be taken to promote research and
training activities on most modern lines to meet the present day requirements.
This will be achieved by re-organising the existing research and training
Labour Market Information System
The formulation and implementation of policies need to be
based on comprehensive, reliable data and timely information on characteristics
of the labour force and various features of the job market. Labour Market
Information System (LMIS) will provide, on a continuous basis, information on
employment/unemployment, job market requirements and future projections
regarding evolution of the job market."
PART - II
33. The law relating to industrial relations will be
revised in the light of provisions of the Constitution of Islamic Republic of
Pakistan and International Labour Standards to make it fully consistent wit the
internationally recognised rights of labour. Some of the salient features of
the new Industrial Relations Ordinance are as under:
(i) A tripartite board of conciliators shall be
constituted to conciliate in industrial dispute where more than one
establishment is involved or industry-wise trade union or a trade union at the
national level is a party.
(ii) On failure of conciliation, proceedings in industrial
dispute in a public utility service, the dispute shall be referred for
arbitration to a board of arbitrators.
(iii) The phrase "notice of conciliation" shall
be substituted to replace the "notice of strike or lockout".
(iv) The tenure of a CBA shall be extended from two to three years.
(v) Joint Management Board and Works Council shall be
replaced by a single body, namely Joint Management Council.
(vi) Conviction on criminal
offences of a heinous nature such as theft, physical assault, murder, attempt
to murder, etc., shall be made the bass of disqualification of a person from
being a member or office-bearer of a trade union.
(vii) The penalty of imprisonment shall be dispensed with
under the law relating to industrial relations. The amount of fines shall,
however, be enhanced suitably to make the law deterrent.
The terms of "employer" and "establishment" will be redefined.
34. In the context of industrial relations more emphasis
will be laid on literalism. The government will take the following measures in
this regard: - strengthen initiative/mechanism for bilateral co-operation such
as WEBCOP, a trust relationship between employers and labour leading to greater
efficiency, workers and employers will he encouraged to evolve bipartite codes
of conduct at all level.
(iii) The role of the state to act as facilitator
will be strengthened.
(iv) District Tripartite Labour Committees
will be set up in pursuant with the ordinate with different agencies at
district level to ensure implementation of different schemes of the government
relating to labour welfare.
Union and Rationalisation
of Labour laws
35. Currently there are large number laws and Rules
& Regulations, which cover a variety of subjects.
a) Law relating to industrial relations.
b) Law relating to employment condition
c) Law relating to human resource development.
e) Law relating to labour welfare and social safety
36. The status of Labour Court will be upgraded and given
the jurisdiction to adjudicate in labour cases as court of first instance. The
Labour Appellate Tribunals will be abolished and the appeal against the order
of the Labour Court shall lie in the High
37. To harmonies labour-employer relationship, a
Labour Court, while determining the case relating to the termination of a
workman, shall also have the power to award equitable compensation to the
aggrieved workers in lieu of reinstatement into the service.
38. National Industrial Relations Commission shall
be revamped and its functions and performance will be reviewed.
Conditions of Employment
39. The consolidated law relating to conditions of employment
shall be made applicable to every industrial and commercial establishment
employing 10 or more workers.
40. The law will, however, provide flexible working
hours to the business community to meet the needs of the society.
41. Pakistan shall ratify ILO
convention 182, which seeks to prohibit and eliminate the worst forms of child
labour. A child, under the convention, has been defined as a person below the
age of 18 years.
45. The federal government shall review every three
years minimum wages of workers in consultation with the National Tripartite
Minimum Wage Council in keeping economic conditions in the field concerning
equal pay for men and women for work of equal value. A fair wage and respect of
male and female workers will be introduced in the law to give effect to the
Occupational Safety and Health
47. The laws relating to occupational safety and
health and working conditions shall be consolidated. Developments in industry
and technology, a National Safety and Health Council shall be established to
set OSH standards and meet the
needs of the industry.
49. The existing law to transport workers needs to
be updated with a view to providing better transport development:
50. A human resource development programme shall be
51. The law relating to apparel training,
rehabilitation of disabled persons, etc., shall be consolidated and enacted as
a law namely, the Human Resource Development Ordinance to meet the of new
The role of Skill Development Council under the
52. The institutional arrangement to associate
employer-workers in human resource development including planning and
management through the Skill Development Councils in all the four provinces and
the territory of Islamabad as employers-led autonomous organisations will be
53. A comprehensive Social Insurance Scheme for old
age and health benefits will be introduced on self-registration/voluntary basis
to allow workers in the formal and informal sector of economy to benefit from
Model Schools for Workers & Children
54. Workers Model Schools (up to intermediate
level) will be established in every district of the country to provide
education for children of workers. These schools will be managed by independent
tripartite provincial board of governors to protect them from political and
Merit Scholarship/Stipend Scheme
55. A scholarship fund will be established to provide
merit scholarships to workers' children seeking higher education. A stipend
scheme for placement of workers' children in selected quality schools and
colleges will also be initiated.
Welfare of Mine Workers
56. The Mines Act, 1923, and other laws relating to
welfare of mine workers will be revised to provide more amenities to them.
Steps will be taken to provide on-job training to these workers. EOBI, Social
Security Schemes, and WWF Schemes would be extended to the mining sector to
provide much needed social protection to mine workers.
57. The institutions namely Workers Welfare Fund, EOBI,
and Social Security shall be re-organised and re-structured to ensure minimum
administrative expenditure and maximum output and benefits for the employees.
The management boards of these institutions would be re-structured to provide
appropriate representation from labour and employers to strengthen their
Labour Welfare Measure by Employers
58. The employers of large establishments will be
persuaded to evolve their own programmes for the welfare and social protection
of their workers.
59. The labour inspection services in the provinces
shall be reorganised and streamlined.
Labour Market Information System
60. A labour market information system for
providing up to date labour force statistics and job market information shall
be developed with the ILO and UNDP funding. Research and training facilities
will be re-organised.-APP
2002 – M/s. S.M. Yaqoob