This is an appeal under section 37 (3) of the I. R. O., 1976, as amended uptodate, against the Award delivered by the Presiding Officer, Labour Court, Peshawar, on 29-9-1976, whereby on acceptance of respondents' application under section 32 (1-A) of the Ordinance, the workers of the D. D. T.
Factory were held entitled to encashment of earned leave due to the transfer of the establishment from Ministry of Health to the Federal Chemical and Ceramic Corporation.
2, The facts, which are relevant for the purpose of this appeal are as follows :----- The D. D. T. Factory, Nowshera was established in 1952 and it was under the control of P. I. D. C. Later on it was taken over by Messrs Technical Interprises, an American Firm, in 1962, and after the expiry of the contract between the American Firm and the Federal Government, the Factory was given back to the Federal Government. In 1972 the charge of the Factory was taken over by the Ministry of Health, Government of Pakistan, and thereafter they handed over the Management and control of the Factory to the Ministry of Production, Government of Pakistan. The respondent (D. D. T. Workers'
Union) raised a demand for the encashment of earned leave, on the 22nd of August 1974, under section 26 of the Ordinance, and thereafter they gave a strike notice on the 5th of September 1974 to the appellant for referring the matter to the Conciliator, as envisaged under sub--section (3) of section 26, and the matter was then referred to Conciliator after notice of strike or lock-out was served on the appellant under section 29 of the Ordinance. That in the notice there were 24 demands out of which the demand for encashment of earned leave was deferred while the other demands were settled. Subsequently the respondent demanded the reference to the matter again to the Conciliator and after long correspondence it was resub--mitted for the decision of the conciliator but as no settlement could be arrived at the conciliator issued a failure certificate to this effect as required under section 32 (1) of the Ordinance, and that eventually the matter was referred to the Labour Court under section 32 (1-A), which reads :- "The party raising a dispute may at any time, either before or after the commencement of a strike or lock-out, make an application to the Labour Court for adjudication of the dispute."
3. The learned counsel for the appellant contended that the matter was not referable to the Labour Court under section 32 (1-A) for the reason that the industrial dispute has not been raised in the prescribed manner, in that no strike notice was given to the appellant as required under section 2!
(3) for the second time when the matter was referred to the Conciliator. Section 29 of the Ordinance requires service of notice of the strike or lock--out to be served on the employer before the matter is referred to the Con--ciliator, and that no industrial dispute is deemed to exist unless it has been raised in the prescribed manner by the Collective Bargaining Agent or an employer, as is laid down under section 43 of the Ordinance, and as there was no industrial dispute pending between the parties, the matter could not have been referred to the Labour Court under section 32(1-A). That the right of encashment of earned leave is not secured right as defined in section 8 of Standing Orders Ordinance, 1968, read with section 49-B of the Factories Act, 1934 (Act XXVI of 1934), which reads Section 8: Government may, subject to such condition as it thinks fit to impose, by notification in the official Gazette, exempt any industrial or com--mercial establishment or class of such establishment from all or any of the provisions of this Ordinance."
"49-B.-(1) Every worker who has completed a period of twelve months' continuous service in a factory shall be allowed, during the subsequent period of twelve months holidays for a period of fourteen consecutive days, inclusive of the .Day or days, if any, on which he is entitled to a holiday under subsection (1) of section 35."
(2) If a worker fails in any one such period of twelve months to take the whole of the holidays allowed to him under subsection (1), any holidays not taken by him shall be added to the holidays to be allowed to him under subsection (1) in the succeeding period of twelve months, so however that the total number of holidays which, may be carried forward to a succeeding period shall not exceed fourteen . .
Secondly that the respondents are continuously in the service of the appellant, therefore, there is no question of encashment of earned leave and this will be only available to them if their services are terminated or they are discharged from service without availing of the earned leave. That the previous Manage--ment was a complete change over of the body dealing with the factory and therefore for those periods the respondents were paid for the earned leave. The argument was that complete change over of the Management would amount to a discharge by the first Management and re-employment by the subsequent Management, and in the instant case there is no right of encashment of earned leave as the Management from one Ministry of the Federal Govern--ment was transferred to another Ministry for the purpose of administration and there was no break in the continuous employment of the respondent.
4. The learned counsel for the respondent, to meet the argument of the appellant's counsel at the outset, submitted that industrial disputes are raised only in respect of those matters which are not guaranteed or secured under the law, for instance providing of uniform to the worker is not provided under any law but a dispute can be raised regarding providing of uniform, cycle allowance, house rent, etc., etc., and in this connection he referred to the definition of "Industrial dispute" under section 2(xiii) of the I. R. O., which runs as follows :- " `Industrial dispute' means any dispute or difference between, employers and employers or between employers and workmen or between workmen and workmen, which is concerned with the employment or non-employment or the terms of employment or the conditions of work of any person, and is not in respect of the enforcement of any right guaranteed or secured to him by or under any law, other than this Ordinance or any award or settlement for the time being in force." and that according to his argument this was not a guaranteed or secured right and the entitlement of the respondent arises out of practice, usage and custom, and that the respondents who were the workers or employees of D. D. T., which is an industrial establishment as defined in the West Pakistan, (Standing Orders) Ordinance, 1968 and, therefore, their terms and conditions would not be affected on the change of owner or Management whatsoever. "Employer" has been defined under section 2(viii) of the I. R. O., which covers the heir, successor, assignee of the establishment, and whenever there was a change of the management of the establishment, the respondents were paid the benefit of encashment of earned leave. Thus there was the practice and usage which had the force of law by encashment of earned leave with every change in the establishment and that in rebuttal there is nothing on the record to show that this practice or usage could be avoided or not entitled by showing a loss or some other reasons. On the contrary the General Manager of the Factory appeared before the Labour Court and stated that he did recommend that workers should be given the benefit of encashment of earned leave, but this was not approved by the Ministry of Production. That the second proposi--tion raised by the learned counsel for the appellant is also without any legal force. That instead of going on strike the respondents/workers had submitted themselves to the jurisdiction of the Labour Court for deciding the industrial dispute.
That under section 30(5), when no settlement is arrived at, if both the parties agreed, then the conciliation proceedings are to continue for such further period as may be agreed by the parties, and Exh. P. W. 1/4 is the settlement and Demand No. 2 (a) is "encashment of earned leave" and it was settled in the following manner; "Since the Union was pressing for encashment of leave, it was therefore suggested by the conciliator to refer this to the concerned authorities for reconsideration."
And the matter was deferred, Exh. P. W. 1/6 is the failure certificate for the case in hand, which is to the effect that there were joint meetings between the Management "and the Collective Bargaining Agent before the Conciliator, and efforts of conciliation were made, but did not bear any fruit and, therefore, a certificate was issued under subsection (1) of section 32 of the I. R. O.
5. A perusal of Annexure 'A' (Exh. P. W. 1 /4) would show that Charter of Demands was made by the General Secretary of the D. D. T. Employees' Union on the 22nd of August 1974, and no agreement could be reached at regarding Demand No. 2(a), and the negotiations between the parties were kept continued till the settlement was arrived at on 5-12-74 in the office of the Conciliator (Director of Labour, N.-W. F. P., Peshawar). In the terms of agreement Demand No. 2 (a) was to the effect :--- "Since the Union was pressing for encashment of leave, it was, therefore, suggested by the Conciliator to refer this to the concerned authorities or reconsideration." Vide Annexure'B' (Exh. P. W.
1/6), the Con--ciliator issued a certificate of failure and directed the C. B. A. To adopt legal procedure to redress its grievance."
6. Before the learned Labour Court Kifayatullah appeared as a witness on behalf of the respondent (C. B. A.). In his statement he stated that the Factory was established by the P. I. D. C. In 1953-54 and in 1960 the Manage--ment was handed over to Technical Enterprises, a Foreign Firm. On this transfer the workers were given the benefit of earned leave. The witness produced Memorandum of the same, photostat copy Exh. P. W. 1/2, and the payment in respect of the accumulation of leave was mentioned in para. A He further stated that in 1972 the Factory was taken over by the Ministry of Health, Government of Pakistan, and that the Management on this transfer paid the benefits of earned leave vide Exh. P. W. 1/3. Later on the Manage--ment of the Factory was taken over by the Federal Chemical and Ceramic Corporation, Ministry of Production, Government of Pakistan, in January 1975 and on this the petitioner raised demand in respect of encashment of earned leave and a settlement was arrived at between the petitioner and the respon--dent, photostat copy Exh.
P. W. 1/4, and the demand in question was covered by item 2 (a) of Exh. P. W. 1/4 that the respondent/Management agreed to reconsider the demand, therefore, the mater was deferred, but as no settlement could be reached, a notice was served on the respondent (Exh. P. W. 1/5), and the Conciliator held a joint meeting and ultimately a failure certificate was issued. He further stated that the Federal Chemical and Ceramic Corporation had an establishment, namely, Kurram Chemical Co. Ltd., Rawalpindi, and had entered into a settlement for the encashment of earned leave.
7. In case PLD 1975 Kar. 373 it was held that in the Industrial Rela--tions Ordinance (XXIII of 1969) S. 32(1-A), Words "at any time" Refer to period after expiry of notice of strike period but before actual commencement of strike and at any time thereafter while strike continues. It was further held:---- "To my mind the words of this subsection have to be read in the context of the preceding section commencing from the raising of the dispute under section 26. The law quite clearly visualises : firstly bilateral negotiations ; secondly conciliation proceedings through conciliator, thirdly an attempt at arbitration and thereafter the liberty to go on strike on the expiry of the strike notice. If it was the intention of the Legislature to give a party liberty of moving an application under sub-- section (1-A) of section 32 at any time of the choosing of the party it was not necessary either to add subsection (1-A) to section 32 or confine this right to 'party raising the dispute' or to add restrictive words 'either before or after the commencement of a strike'. The dispute has to be raised in a particular manner, it is the party raising the dispute who can move an application under this subsection either before going on B strike or during its continuances. Subsection (1-A) of section 32, there--fore, refers to the period after the expiry of the notice of strike periods but before the actual commencement of the strike and at any time thereafter while the strike continues. So understood there would be no occasion to make an application under section 32 (1-A) during the pendency of a conciliation proceeding. If the words 'at any time' are given their widest connotation and given literal meaning it would enable a party to make an application under subsection (1-A) without any notice to the employer, without any attempt at bilateral negotia--tions or an attempt at conciliation making redundant the words 'the party raising the dispute' and 'either before or after the commencement of a strike' and making inconsequential the context of the subsection and scheme of the Ordinance.
The result is that the Union's application under section 32 (l-A) of the Industrial Relations Ordinance, 1969, was premature and not maintain--able, and this petition must therefore, fail."
I am in respectful agreement with the dictum laid down by the Division Bench.
8. On going through the entire evidence I do not find that there was any notice of strike as laid down in the relevant provision of the Ordinance, and the case of the petitioner was in fact premature. Not only the previous pay--ment of encashment of leave was on the termination of the services of the respondent/workers and there was no continuance of service or employment in.
The two change overs of the Management, first that of the P. I. D. C. And secondly by the Technical Enterprises. As such the appeal is accepted and the order of the learned Labour Court is set aside.
Parties to bear their own Costs.