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Appeal No. KAR‑409 of 1982, heard on 1st November, 1982.

Employees' Cost of Living (Relief) Act, 1973 (I of 1974)‑--

----S. 7 read with West Pakistan Industrial and Commercial Employ ment (Standing Orders) Ordinance (VI of 1968), S. O. 10‑C‑Basic wages and wages‑Distinguished‑Bonus‑Worker being paid in addition to statutory bonus under S. O. 10‑C of West Pakistan Industrial and Commercial Employment (Standing Orders) Ordinance, 1968 additional bonus equivalent to three months' basic wages exclud ing cost of living allowance‑Cost of living allowance included in statutory bonus‑‑Claim that such allowance should be included for purpose of additional bonus also‑Entitlement of additional bonus based upon a circular letter of employer specifically stating that same payable cm basic wages only excluding all allowances particularly cost of living allowance‑Provisions of S. 7 of Cost of Living (Relief) Act, 1913) in circumstances, held, not applicable to such additional bonus‑Application of union under S. 34 of Industrial Relations Ordinance, 1969, held, not maintainable as additional bonus based upon a circular letter was not enforceable right conferred by law, settlement or award‑Industrial Relations Ordinance (XXIII of 1969); S. 34.

Ch, Rasheed Ahmed for Appellant.

Date of hearing : 1st November, 1982.

DECISION

This appeal is directed against the order of the learned Fifth Labour Court, made on 9th September, 1982 dismissing the application of the appellant union under section 34, praying for a direction to the respondent -Company to pay the additional bonus on wages including cost of living allowance.

2. The respondent‑Company had resisted the application of the appellant union both on merits as well as on the ground that in the settlement entered into by the appellant union with the respondent‑Company, it had been categorically agreed by the union, which is the C.B.A. in the establishment, that no fresh demand would be raised. It way, however, be pointed out that the appellant union, in this matter is not raising a fresh demand but is seeking to enforce a right, which according to it, has been conferred on the workers.

3. The learned Labour Court, has however, dismissed the appellant unions application mainly on the ground that the cost of living allowance does not form part of wages for the purposes of the extra bonus which has been paid to the workers of the respondent‑Company.

4. It is an admitted position that in addition to the statutory bonus under clause (l) of Standing Order 10‑C, which is on wages including cost of living allowance, the respondent‑Company has paid to its workmen bonus equivalent to three months' basic wages, excluding cost of living allowance. It was contended by Mr. Ch. Rasheed Ahmed, the learned counsel for the appellant union; that since the cost of living allowance is to form part of the wages of workers for the purposes of bonus: as provided in section 7 of the Employees' Cost of Living (Relief) Act, 1973, the workers of the respondent‑Company are entitled to the additional bonus equivalent to three months wages, including cost of Living allowance. The entitlement of the workers to the bonus is based on a circular, dated 15th June, 1981 issued by the respondent‑Company, the relevant portion whereof reads as follows :‑

"that bonus for the year 19800 shall be paid at the rate of three months basic wages (excluding all allowances and more specifically cost of living allowance)."

5. A bare perusal of the above circular indicates that bonus admissible to the workmen is equivalent to three months basic wages. The .expression "basic wages", particularly when it is coupled with the words, "excluding all allowances and specially the cost of living allowance", cannot be construed as "wages" as used in section 7 of the Employees Cost of Living (Relief) Act, 1973. The expression "wages" has been defined in the said Act to include Dearness Allowance or other addition in respect of cost of living payable or paid for the period preceding the 1st day of August, 1973. On the other hand "basic wages" would mean the bare wages excluding any allowances. Since there is a material distinction between the two terms "wages" and "basic wages", the provisions of section 7 of the aforesaid Act will have no application to cases where workmen are entitle to bonus on basic wages. Of course, in the case of statutory bonus, it is to be calculated on the basic of wages and cost of living allowance is to form part of the wages.

6. There is another strong ground on which the appeal of the workers union is. liable to be rejected. An application under section 34, I.R.O., can only be made for the enforcement of the rights which have been conferred by law, a settlement or an award. The admissibility or the entitlement of workers to the additional bonus is not founded upon an law, settlement or award but upon the circular reproduced above. The said circular, as already stated, provides for payment of additional bonus equivalent to three months basic wages excluding allowances particularly' cost of living allowance.

7. For the reasons discussed by me above I find no merit in this appeal and dismiss the same in liming.

Appeal dismissed.

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