Find a Lawyer

Payment of Wages Act (IV of 1936)‑‑--

--‑‑S. 15 (3), proviso‑Compensation‑Authority empowered to award compensation not only for dues illegally deducted but also for delayed wages‑Discretion to award compensation and amount of compensation must be fixed keeping in mind circumstances of case- Bus Conductor of Sind Road Transport Corporation remaining away from duty under treatment of doctor of Corporation reporting for duty when that Corporation bifurcated and Karachi Transport Corporation also established‑Not given duty for some time due to fact that he was from amongst those retrenched due: to reorgainsation‑Claiming wages for entire period of his illness covered by medical certificates and also for period for which no duty assigned after reporting for duty‑Authority awarding wags for such total period plus compensation @ 5 times of such wages‑Labour Court in appeal reducing compensation @ two times of wages‑Labour Appellate Tribunal in suo motu exercise of revision powers examining case‑Held : Bus Conductor, in circumstances, was entitled to wages for period for which leave on medical grounds was due and nothing more‑For compensation purpose case, in circumstances, held, covered by proviso to S. 15 (3) of Payment of Wages Act, 1936 and delay in settling claim being due to abnormal circumstances and bona fide dispute on account of bifurcation of Karachi Transport Corporation from Sind Road Transport Corporation claimant was not entitled to any compensation‑Industrial Relations Ordinance (XXIII of 1969), S. 38 (3‑a) read with Payment of Wages Act (IV of 1936), S. 17.

Abdul Muneem Khan for Applicant.

Raees M. Mushtaq for Respondent No. 1.

Sirajul Haque Qureshi for Respondent No. 2.

Date of hearing :15th March, 1983.

The Record & Proceedings of Appeal No. 2/82, instituted S. R. T. C. v. Shamshuddin and another, were called for in the exercise of the suo moru powers of revision of this Tribunal to examine the correctness, legality and propriety of the Order passed by the learned Vth Labour Court, an appellate authority under the Payment of Wages Act, 1936, modifying the Order, dated 20th January, 1982, passed by the learned Authority under the Payment of Wages Act, 1936, directing the S. R. T. C. to pay an amount of Rs. 6,000 to bus conductor, Shamshuddin, as his wages, plus a sum equal to twice that amount as compensation on account of delay in making payment of wages to the said Shamsbuddin.

2. The facts of this case, shortly stated, are that on 25th September, 1977, Shamsbuddin submitted an application under, section 15 of the Payment of Wages Act, 1936, to the Authority nominated under the said Act in Karachi, claiming an amount of Rs. 5,475 as his unpaid wages for the period from May, 1976, to September, 1977, and an amount of Rs. 525 as unpaid bonus for the years 1974, 1975 and 1976. The application was filed against the K. R. T. C., the Respondent No. 2 in the appeal before the learned Appellate Authority under the Act, and it was asserted therein that the applicant, Shamshuddin, was employed as a bus conductor, with Token No. 188 in the K. R. T. C., that in the month of .June, 1976, he fell ill and remained under the treatment of n doctor who issued him a fitness certificate; dated 12th February, 1977, that he reported for duty alongwith the doctors certificate whereupon the K. R. T. C. was pleased tea take him on duty on 13th February, 1977, and directed him to report to the District Manager, Gulbai Depot, even though it had already been closed, that on reporting at Gulbai Depot, he was again directed to report to Central Depot and then to the Headquarters of the K. R. T. C., but he was not assigned duties,; that again on 7th March, 1977, and subsequently by the letter, dated 28th March, 1977, he was once more directed to report to Gulbai Depot, which, however, was already closed and hence he could trot be taken on duty and thus the applicant had been wandering for duty throughout this period but was not taken on duty ; that finally, the applicant served a legal notice on both the Karachi Road Transport Corporation and the Sind Road Transport Corporation, but no fruitful results bad followed and hence he was submitting this application for payment of wages.. for the period from May, 1976 to September, 1977, being the wages for a total period of 17 months, which had not been paid to him. It would be appropriate at this stage to state that on 1st February, 1977, there was a bifurcation of the S. R. T. C. as it was then operating. A new company, known as the Karachi Transport Corporation, was set up under the directions and control of the Central Government which was to take over the urban transport system in Karachi while the S. R. T. C., which shifted its Head Office to Hyderabad, was to operate the Government transport system in the areas of the Province of Sind excluding the city of Karachi and its suburbs. A working arrangement was effected between the S. R. T. C. and the K. T. C. by which the K. T. C. took over certain old employees of the S. R. T. C. A further arrangement between the 2 corporations was that the S. R. T. C. would on proper bills being submitted to it make payments in respect of the pre‑bifurcation liabilities of the employees upto 31st July; 1977, but would be reimbursed for such amounts by the K. T. C. Since the buses with the new 2 corporations were limited, while the old staff of the S. K. T. C. was greatly in excess of the number of buses, the S. R. T. C. issued Public Notices in the National Newspapers requiring all employees of the S. R. T. C., who had come to its share, to report to the Secretary, Bifurcation Cell, Deb. Mehran Depot, on 30th July,‑1977, along with their National and Sind Transport Corporation Identity Cards and last pay certificates issued by the K. T. C. and such employees were warned that if any individual would fail to report for duty as per the above Notice, his claim for service would not be entertained. It appears that in pursuance of the said notice, as many as 1078 employees reported for duty out of which 606 employees were absorbed while the services of the, remaining 472 employees were terminated for want of vacancies. Similarly the K. T. C: retrenched a number of its employees and absorbed only such employees as it considered necessary.

3. Reverting back to the case of bus conductor, Shamshuddin, his claim is that from May, 1976, upto 12th February, 1977, he was sick and under treatment. The period from 15th May, 1976 to 15th June, 1976, is covered by 2 medical certificates issued by the Medical Officer of the Hospital run by the S. R. T. C. itself. The first certificate is dated 14th May, 1976, and it is to the effect that he was under treatment in the said hospital for Hepatitis with effect from 14th May, 1976, and that he had been advised rest for treatment for 16 days from 14th May, 1976. The second certificate, which is dated 2nd June, 1976 and is signed by the Medical Officer of the Sind Government Dispensary, is to the effect that Shamshuddin continued to suffer from the aforementioned ailment and that he required 15 days further treatment and rest with effect from 30th May, 1976. The last certificate is from a private medical practitioner, Dr. Anwar Muhammad, a non‑graduate doctor, who has certified that Shamshuddin was suffering from Hepatitis from 1st June, 1976 to 12th February, 1977, and was under his treatment for the said period. The certificate further indicated that Shamshuddin was now fit for duty. According to Shamshud din he took these certificates to the Central Depot, which was then incharge of the K. T. C., from where he was sent to the Head Office, but from the Head Office, he was directed to go to. Hayderabad. According to him, he went to Hyderabad, where he was given a letter, Exh. A‑4, and was directed to work at Karachi, but he was not taken on duty. It is obvious that Shamsuddin was not given the letter, Exh. A‑4, dated 28th March, 1977, at Hyderabad. That letter is addressed to him by the K. T. C. with a copy to the S. R. T. C., informing him that Gulbai Depot, Karachi, was still under the control of the S. R. T. C., Hyderabad, and he should short to the District Manager, S. R. T. C. ,Gulbai Depot.. There is, however, another letter, dated 6th April, 1977, which clearly indicates that Shamshuddin had contacted the S. R. T. C. office at Hayderabad. The said letter is addressed to the K. T. C. with a copy to Shamshuddin. The stand taken by the S. R. T. C. in that letter was that as all staff of Gulbai Depot was transferred to Central Depot, as explained to Shamshuddin personally, he may be directed to report for duty to the District Manager, Central Depot, K. T. C., Karachi.

4. It appears that neither the Central Depot nor the K. T. C. was agreeable to take Shamshuddin on duty or to absorb him and hence a formal legal notice, dated.28th August, 1977, was served by Shamshuddin both upon the K. T. C. and the S. R. T. C. This notice also did not prove fruitful and hence, on 25th September, 1977, Shamshuddin preferred an application under section 15 of the Payment of Wages, Act, 1936, before the Payment of Wages Authority at Karachi.

5. The proceedings taken on the above application were wasteful and, therefore, time consuming. Although the application was made against the Chairman, K. R. T. C., and his address was given as near Fine House, Drigh Road, Karachi, the‑notice of the application was given to the Sind Transport Corporation, which forwarded the same to the K. T. C., and also informed the‑Authority under the Payment of Wages Act, that notice has been wrongly sent to .it. Without ascertaining whether notice of the application had been served upon the correct party, Shamshuddin was allowed to lead ex parte evidence in support of his claim on 23rd December,. 1977, and on 15th January, 1978, an ex parte order was passed by the Authority under the Payment of Wages Act awarding an amount of Rs. 6,000 to Shamshuddin as his claim for wages and directing the S. R. T. C. to pay the said sum to him. No compensation in addition to the wages was allowed to Shamshuddin. Subsequently, on realizing that the application under the Payment of Wages Act had been made against K. R. T. C. and not the S. R. T. C., an order was made on 11th March, 1978, substit uting the K. R. T. C. as the party liable to deposit the amount of Rs. 6,010 for payment to Shamshuddin. On coming to know of the passing of the aforesaid ex parte order, the K. T. C. submitted an application for setting aside the same and by consent the ex parte order was set aside on 26th March, 1978. The K: T. C.'s stand in its written statement, dated 7th May, 1978, was that Shamshuddin was neither their employee nor they had ever appointed him nor they had ever issued an appointment order to him and hence it was not liable for the arrears of the wages or for the unpaid wages claimed by him. In view of this written statement, Shamshuddin submitted an application for joining the S. R. T. C. as a party. It appears that the office of the Authority under the Payment of Wages Act once more bungled in that it issued notice of the application under the Payment of Wages Act to the S. R. T. C., but without enclosing, a copy of the said application with the notice. It appears that copy of the plaint was received by the S. R. T. C. on 23rd July, 1978. However, as the S. R, T. C., remained absent on 31st July, 1978, and again on 22nd August, 1978, ex parse evidence of Shamshuddin was recorded tin the latter date and the side of the 5. R. T. C., was closed. However, by an application, dated 15th October, 1978, the S R. T. C. prayed fur re‑opening its side and being allowed to lead evidence. By order, dated 30th January, 1979, the order closing the side of the S. R. T. C. was set aside and it was allowed to lead evidence. On 25th May, 1919, the S. R. 1:. C. cross‑examined Shamshuddin who also produced the correspondence connected, with his case, including the letters written by the S. R. T. C. to the K. T. C. The S. R. T. C. examined 2 witnesses, namely, office Superintendent Hazoor Bux and Abdullah, Personnel Officer, in support of their pleas that after the bifurca tion, the S. R. T. C. ceased to do transport work at Karachi and shifted its Head Office to Haderabad, that through the newspapers, the staff of the S. R. T. C. was required to report for duty at the Deh Mehran Depot Karachi and the staff was explicitly warned that failure to‑ do so before 30th July, 1977 would absolve the S. R. T. C. from all liabilities to retain them in service and that by a general order published on 7th August, 1977, as many as 4017 drivers and conductors, including Shamshuddin, were discharged from service, as being surplus to the requirements of the S. R. T. C. The 2 witnesses produced the various notices published in the newspapers including the notices of termination of the services of the bus conductors and drivers of the S. R. T. C.

6. The Authority under the Payment of Wages Act took the view that since it has been admitted by Office Superintendent, Hazoor Bux, the witness of the S. R. T. C., that Shamshuddin was an employee of the S. R. T. C., that from June, 1976 to 12th February, 1977, he remained sick and was not paid his dues and that the liability before bifurcation has been accepted by the S. R. T. C., it accordingly directed the S. R. T. C. to pay an amount of Rs. 6,000 to Shamshuddin as his wages, as claimed by him, plus 5 times this amount as compensation. On appeal, the said order was maintained except that the quantum of compensation was reduced from 5 times of the amount of the wages stated to have been unpaid to twice the said amount, in other words, the total amount awarded to Shamsbuddin was Rs. 18,000.

7. I have heard Mr. Raees.M. Mushtaq, Advocate, who appeared for the S. R. T. C., Mr. Sirajul Haque Qureshi for the. K. T. C., and Mr. Abdul Muneem Khan for Shamshuddin. As it was stated by Mr. Abdul Muneem Khan that Shamshuddin had preferred no claim against the K. T. C., Mr. Sirajul Haque Quneshi did not make any submission to this statement of Mr. Abdul Muneem Khan regarding the want of liability of K. T. C. in this matter. Mr. Raees Mushtaq raised a number of pleas against the award of both the alleged unpaid wages as well as compensation to Shamshuddin. His first contention was that the Payment of Wages Act was not applicable to the S. R. T. C., as it was only applicable to the K. T. C. in Karachi. Although the Payment of Wages Act, 1936, was originally made applicable to Tramways and Omnibuses in Karachi only by Notification No. 1‑1 (L‑4)/65 (1), dated 13th December, 1965, published in the Gazette of West Pakistan, Part 1. dated 7th January, 1976, at page 13, the provisions of the said Act were made applicable to the Road Transport Service as defined in sub section (7) of section 2‑ of the Road Transport Workers Ordinance, 1961. In view of the said notification, the provisions of the said Act indubitably apply both to the K. T. C. and the S. R. T. C.

8. It was next submitted by Mr. Raes Mushtaq that inasmuch as the S. R. T. C. had ceased to operate in Karachi after 1st February, 1977, upon bifurcation, and since the application by Shamshuddin under the Payment of Wages Act was made on 25th April, 1977 and further the S. R. T. C. was made a party to the said application by the application of Shamshud din, dated 14th May, 1978, the Authority for Karachi under the Payment of Wages Act had no jurisdiction in the matter over the S. R. T. C. According to the Notification issued by the Government of Sind the relevant time, the Authority under the Payment of Wags Act, 19:36, for the Central Division of Karachi had jurisdiction for part of Karachi only, while the Assistant Director Labour (Compensation) Hyderabad , was designated as the Authority under the‑said Act for the Districts of Dadu, Thatta, Badin and Hyderabad. However, the claim of Shamshuddin was for delayed wages or non‑payment of wages at Karachi from May, 1976 to September, 1977. The jurisdiction of the Authority under the Payment of Wages Act is not dependent upon the Head Office of a party but the place where the claim arose. Since the claim arose at Karachi, therefore, the Authority notified under the Act for the Central Division had jurisdiction in the matter.

9. It was next submitted by Mr. Raes Mushtaq that there was no evidence to establish that Shamshuddin was ill during the period from 15th June, 1976 to 12th February, 1977 and hence he was not entitled to leave nor he was entitled to wages for this said period. As already pointed out Shamshuddin had produced 3 medical certificates in support of his plea that he was sick with effect from 14th May, 1976 up to 12th February, 1977. Two of the certificates. which are dated 14th May, 1976 and 2nd June, 1976 are from the. Government Dispensary and the authorized hospital of the S. R. T. C. They indicate that from 14th May, 1976 upto 14th June, 1976 Shamshuddin was unable to perform his duties as he was suffering from Hepatitis. The third certificate was from Doctor Anwar Muhammad, who has certified that from 1st June, 1976 to 12th February, 1977. Shamshuddin was under his treatment for Hepatitis and rheumatic sinus and that he was unable to perform his duties during this period. In the first place, this certificate is materially different from the 2 certificates issued by the Government Medical Officers which indicate that Shamshuddin was suffering only from Hepatitis and not ‑rheumatic sinus. Secondly, Doctor Anwar Muhammad, who bad issued the certificate, although a registered medical practitioner is not a graduate‑‑doctor and holds only a Diploma. As such, his certificate is of much lesser value than the certificates issued by the Government Doctors. Furthermore it has not been satisfactorily explained by Shamshuddin why he went to a private practitioner when there was a Dispensary and Hospital run by the S. R. T. C. Moreover according to Shamshuddin he was suffering from kidney pain which is quite different from rheumatic sinus. However. even if the medical certificate of Dr. Anwar Muhammad is accepted and it is conceded that Shamshuddin was unable to perform his duties with effect from .14th May, 1977 upto 12tb February, 1977 the question arises whether he was entitled to wages for this entire period, and if so, whether he was entitled for the full wages for the. whole period. 1t is the case of Shamshuddin himself that he had joined the S. R. T. C. in November, 1973. Thus, at the time when he started to remain absent from his duties on account of his sickness, he had less ' than 2J years total service. It has come from the evidence of witness Abdullah, the Personnel Officer of the S. R. T. C., that a conductor is entitled to only 15 days medical leave during the whole year. As such, even if _Shamshuddin had taken no medical leave prior to 14th May, 1976, he was entitled only to one month's medical leave on full wages i.e., upto 15th June, 1976, the period covered by the 2 medical certificates issued by the Government Medical Officers Since Shamshuddin does not appear to have been entitled to medical leave ,4 t or the period from 15th June, 1976 to 12th February, 1977 he cannot rightly claim or be awarded Wages for the said period.

10. It was next submitted by Mr. Raes Mushtaq that Shamshuddin is not entitled to the wages for the period even after 12th February, 1977 as per the notices issued in the various newspapers he and the other members of the staff the of S. R. T. C. were required to report for duty at Deh Mebran Depot, near Malir Halt, Karachi, on 30th July, 1977 and since he had failed to do so, his claim for service and back wages cannot be entertained‑‑as clearly notified in the said notices. Shamshuddin has claimed that he did not come across these notices nor he came to know about the bifurcation. Since the bifurcation was effected on 1st February, 1977 and a large number of his colleagues were retrenched and the notices appeared in a number of newspapers, he cannot be heard to say that be did not come to know about the same‑. I am, therefore, clearly of the opinion that he was fully aware of the bifurcation. The letter of the S. R. T. C., dated 6th April, 1977 to which I have already made reference, specifically mentions the fact that it had been explained to Shamshuddin personally that he had been transferred from Gulbai Depot to the Central Depot. This letter, therefore, which was produced by Shamshuddin himself, establishes the fact that he had gone to Hyderabad and had contacted the S. R. T. C. authorities there. Even' in his evidence before the Authority recorded on 22nd August, 1978 he has admitted the position that he had gone to Hyderabad in this behalf. It is thus clear that Shamshuddin was fully aware of the bifurcation and further is presumed to have notice of the Newspaper's Notices requiring him to report for duty at Deh Mehran Depot on 30th July, 1977. Since he failed to report for duty at Deb Mahran Depot on the aforesaid date and instead was trying to plead that the K. T. C. should take him up on duty and in fact had originally filed an application under the Payment of Wages Act only against the K. T. C., he would not be entitled to any dues from the S. R. T. C. after bifurcation. 1n this connection, it may be mentioned that although the S. R. T. C., was to discharge the pre‑bifurcation liabili ties, according to the working arrangement between the S. R. T. C. and the K. T. C., the liabilities were to be discharged on the basis of a proper bill being prepared by the K. T. C. and the amount paid by the S. R. T. C. and on the understanding that the amount paid by the S. R. T. C. would be refunded by the K. T. C.

11. The claim of Shamshuddin was not for payment or refund of any amount of wages wrongly deducted but for non‑payment of dues. Although I am of the view; for the reasons already given, that Sham shuddin was not entitled to such wages or dues for the period after 15th June, 1977, but even if he had been, he clearly was not entitled to award of compensation on the basis of this claim for non‑payment of delayed wages. He himself had admitted that he was sick from May, 1976 upto 12th February, 1977, and it was after this that he had attempted to report for duties. Before this, however, on 1st February, 1977, there was bifurcation and the K. T. C. took over the urban transport in Karachi while the S. R. T. C. was made responsible for the transport in the re maining part of the Province. There was bound to be some confusion on account of this reorganization, specially in the case of Shamshuddin who had attempted to report for duty much after the bifurcation and that too to the K. T. C. and not to the S. R. T. C. In such circumstances fie clearly was not entitled to any compensation muchless compensation equivalent to 5 times the dues claimed by him. Although the Authority under the Payment of Wages Act is entitled to award compensation not only for dues illegally deducted but also for delayed wages, but the discretion to award compensation and the amount of compensation awarded must be fixed keeping in mind all the circumstances of the, case. The learned Authority under the Payment of Wages Act in the instant case has failed to take into consideration the relevant factors and in fact has awarded compensation equal to 5 times the dues claimed by Shamshuddin without assigning any reason for such an order. It has further failed to take into account the fact that when originally the matter was decided ex parte Shamshuddin was allowed his bare claim of Rs. 6,000 and no compensa tion was allowed to him. It is true that the proceedings before the Authority dragged on from 9th October, 1977 up to 29th January, 1983, but most of the blame for the delay rests on the shoulders of the Authority itself and its office. The Authority has given numerous adjournments for which there was no valid ground. It may be mentioned that as many as 5 adjournments were given for writing the order. The proviso to subsection (3) of section 15 of the Act provides that no direction for the payment of compensation is to be made in the case of delayed wages if the Authority was satisfied that the delay was due to (i) bona fide error or bona fide dispute as to the amount payable to the employed persons, or (ii) the occurrence of an emergency, or the existence of exceptional circumstances, such that the person responsible for the pay ment of the wages was unable, though exercising responsible diligence, to make prompt payment, or (iii) the failure of the employed person to apply for or accept payment. I have already indicated that this was a claim for delayed wages and not for illegal deduction of wages and that the delay in the settling of the claim was due to abnormal circum stances on account of bifurcation e: K. T. C. from the S. R. T. C. It may further be pointed out that the S. R. T. C. in its legal objections‑Cum‑reply statement filed on 31st August, 1978, soon after it was made a party to the application under the Payment of Wages Act and was duly served upon, had asserted as under

"The S. R. T. C., is quite unaware about his case. Besides the liabi lities before bifurcation i.e. 1st February, 1977, will accept by S. R. T. C., Hyderabad. He may kindly be directed to get prepare the dues bill from ‑ his concerned depot and sent to S. R. T. C Hyderabad for payment claimed amount is not correct.

12. The above statement would indicate that the S. R. T. C. at no time was unwilling to pay the legitimate dues of Shamshuddin provided he made proper claim and proper approach in this behalf, It would appear that there were exceptional circumstances responsible for the failure on the part of the S. R. T. C. to make payment to Shamshuddin, though it was willing to make payment on his establishing that the s‑me were due to him and that further there was a bona fide dispute as to the amount payable to him. In the circumstances, the case of Shamshuddin clearly falls within the proviso of subsection (3) of section 15 of the said Act and in any case he would not be entitled to any compensation.

13. The upshot of the above discussion is that Shamshuddin is not entitled either to the payment of any wages after 15th June, 1976 or any compensation. However, the actual position is that the total amount of wages and the compensation equal to twice of the amount dues claimed by Shamshuddin were actually deposited before the learned Authority for the Payment of Wages Act by the S. R. T. C. and this amount has since been paid over to Shamshuddin.' Mr. Reas Mushtaq stated that the S. R. T. C. was more interested in having the legal position clarified rather in recovering the amount which has been invalidly ,paid to Shamshuddin. In the circumstances, would make no order for the recovery of the said amount from Shamshuddin.

Appeal dismissed.

Find a Lawyer Near You

Dealing with a matter like this? Connect with a verified advocate in your city — free on SJP Lawyers Directory.