DECISION ' A memorandum of settlement dated 15th of June, 1978, was signed between the management of Bata Shoe Company (Pakistan) Limited Batapur, hereinafter referred to as the Company, and the workers of the Company through Bata Mazdoor League (Regd.) Pakistan who was the certified C B A at the relevant time. The settlement is still in force and will expire on 9th of March, 1980. One of the settled conditions was that no financial demand shall be raised during the subsistence of this settlement. Sometime later, another body of workers in the name and style of Pakistan Bate Employees' Federation in the same Establishment came into existence. On Secret Ballot for determination of CBA for the Establishment of Bata Shoe Company (Pak.) Limited was therefore, held on 18th December, 1978 under section 22 (2) of the Industrial Relations Ordinance as amended upto date by this Commission. Pakistan Bata Employees' Federation, hereinafter referred to as the Federation, was declared successful and a certificate to this effect bearing No, 12/78 was issued in favour of the Federation under cover of letter dated 21st December, 1978, by the Secretary of National Industrial Relations Commission.
2. The Federation served the Company with a fresh charter of demands dated 16th of April, 1979 which was resisted by the company on the ground that in view of existing settlement which was valid upto 9th of March, 1980, no fresh demands could be raised at this stage. The Federation served the Company with a strike notice under section 28 of the Industrial Relations Ordinance, 1969 dated 29th April, 1979. Consequent conciliation before the Conciliator, Lahore failed on 16th April, 1979. Failure certificate was issued on the same date. The Federation did not resort to strike and on 26th May, 1979 filed an application under section 34-A of the Industrial Relations Ordinance before National Industrial Relations Commission for adjudication of the Industrial Dispute on the basis of above-mentioned charter of demands. The petition was resisted by the Company.
3. The respondents had raised two preliminary objections with regard to maintainability of the application and, therefore, the parties were directed to argue these issues before passing on to the merits.
4. The first preliminary objection is to the effect that the Pakistan Bata Employees' Federation, Lahore, the applicant is not a validly constituted Trade Union of Workmen and, therefore, has no locus standi to raise this dispute. The second objection is that memorandum of settlement dated 15th June, 1976 is valid upto 9th March, 1980, and, therefore no fresh charter of demands can be served on the management and that is violative not only of the law but also of the undertaking given in settlement that no financial demands will be raised during the pendency of the settlement.
Another objection taken at the time of arguments by Mr. M. S. Bokhari, learned counsel for the Company was that the strike notice Annexure 'D' did not specify the time of 14 days with the result that there was no valid strike notice and consequently no valid industrial dispute.
5. With regard to the first objection, viz. The status of the applicant C B A, this Commission has already adjudicated upon this aspect by order dated 19th July, 1979 of the learned Chairman of the Commission passed in case No, 20 (5)/79 between the same parties recognizing the bargaining status of the applicants.
6. Mr. Bokhari next argued that provisions of section 28 of Industrial Relations Ordinance are of mandatory nature. This section lays down that the period of a notice of strike given under subsection (3) of section 26 of the I. R.
0. Shall be 14 days. He submitted that a notice of strike which was either less than 14 days or in excess or which did not specify any period was invalid and could not give rise to it valid industrial dispute. According to Mr. M. S. Bokhari, notice of strike in this case which is Anoexure 'D' is invalid as it is not in accordance with section 28,
1. R. O. He supported this argument with a case by the Punjab Labour Appellate Tribunal, Lahore reported as 1980 PLC 57. It was decided that the provisions of section 28 of the Industrial Relations Ordinance, are not directory but mandatory and a strike notice which is of less than 14 days duration is not valid. The relevant extract is reproduced hereunder :- "The learned counsel for the Respondent raised another preliminary objection that there has been non-compliance of section 28 of the Ordinance. According to the above section the period of strike shall be 14 days. The strike notice was received by the management on 22nd January, 1976 to the effect that the union intended to go on strike on 4th February, 1976. This shows that the strike notice was less than 14 days, which is contrary to the provisions of section 28 of the Industrial Relations Ordinance, 1969. The provisions of section 28 are not directory but mandatory. The Supreme Court held that the provisions of section 26 of the Ordinance were directory, which does not mean that the provisions of section 28 or also directory. According to section 43 of the Ordinance, no industrial dispute shall be deemed to exist unless it has been raised in the prescribed manner by a C B A or any employer. Since the Industrial dispute has not been raised by the appellant union in the prescribed manner, it shall not be deemed to exist. Therefore, the petition under section 32 (1-A) of Industrial Relations Ordinance, 1969 was not maintainable."
7. In another case reported as 1975 PLC 638 the same Tribunal held that notice of strike for a period of 21 days was not valid because section 28 of the Industrial Relations Ordinance, 1969, was mandatory.
8. The above two cases cited by the learned counsel do not give reasoning for arriving at the conclusion that provisions of section 28 of the Industrial Relations Ordinance, 1969 are mandatory.
The test for determining whether a provision is mandatory or directory has been the subject matter of many cases decided by Courts of superior jurisdiction both in Pakistan and foreign. It has been laid that if an act is directory its disobedience does not entail any invalidity but if the act is mandatory disobedience entails serious legal consequences amounting to invalidity of the act done in disobedience to the provisions.
9. This matter came up for consideration in a case reported as 1976 SCMR 82 where the question under consideration was whether the provisions of section 26 (3) of the I. R.
0. Which lays down a period of 7 days to enter into bilateral negotiation was mandatory or directory. It was held as under :-
10. Precisely the same considerations are attracted to provisions of section 28 of the Industrial Relations Ordinance and the principle laid down in the above case applies to it with equal force. I respectfully borrow the reasoning of the Supreme Court to come to the finding that provisions of section 2$ of the Industrial Relations Ordinance are not, mandatory. This finding is inescapable if examined in the light of 1 another judgment or the Supreme Court reported 4S P 14 D (?) SC 134.1I, therefore, overrule this preliminary objection and hold that non-compliance of time schedule laid down in section 28 of the I. R.
0. Does not invalidated the strike notice.
11. The next question is whether the application is maintainable during the subsistence of the earlier settlement which holds the field till 9th March, 1980. The substantive provision is to be found in section 49 (2) of the I. R. O. Which makes a settlement binding for the period from which it is entered into till after the expiry of two months from the aforesaid period. Mr. M. S. Bokhari, the learned counsel for the Company, relied upon a number of cases in support of his preliminary objection. In 1975 PLC 153, Sind Labour Appellate Tribunal held that great sanctity is attached to settlement reached between Management and Labour and intention of legislature in making a settlement operative for two years is designed at achieving industrial peace. It was also held that fresh demand in respect of any matter involving financial implications during the operation of settlement is not permissible. Three earlier cases reported as 1960 PLC 166, 1966 PLC 279 and 1968 PLC 78, were relied upon in support of this decision. He also relied on 1966 PLC 274 and 1968 PLC 87 in support of the preliminary objection.
12. Mr. Zia Mahmood Mirza, learned counsel for the applicant C B A, did not dispute the above proposition of law but argued that it is permissible to agitate the already settled demands having financial implication if at any time before the expiry of the effective date, the circumstances in which the settlement was arrived at are materially changed. He relied upon 1975 PLC 638 (643) in support of his contention. In this case the learned Appellate Tribunal, Punjab held that "it is well established that the demands regarding financial implications can be raised in spite of the previous settlement if the conditions and the circumstances have materially changed. This is question of fact and the party raising the demands has to satisfy the Court that the conditions and circumstances have in fact been materially changed". Mr. Mirza further relied on 1976 PLC 340 by the same Tribunal wherein the above findings have been repeated. Yet in another case the Labour Appellate Tribunal Punjab came to the same conclusion as above. See 1976 PLC 533.
13. With due respect to the learned Labour Appellate Tribunal, Punjab, it is observed that in all the 3 cases the same wording has been repeated verbatim, viz. "it is well established that the demands regarding financial implication can be raised in spite of the previous settlement if the conditions and the circumstances have materially changed". I looked for the authority which this finding of the Labour Appellate Tribunal, that this proposition is well established is based but was not able to find any. Mr. Mirza cited a Division Bench judgment of the Lahore High Court reported as Messrs The Attock Oil Co. Ltd. v. The Supreme Body of Oilfields League and Refinery Union, Rawalpindi (I), in support of his contention. The judgment is based on entirely different facts and set of circumstances. In this case a settlement was arrived at between the Workers and the Management which contained a clause that the workers undertake not to raise or pursue during operation of this settlement any demand involving financial commitments/ {{FOOT NOTE}}
(1) PLD 1970 Lah. 122 {{FOOT NOTE}} ' expenditure. Subsequently the company decreased the rate of bonus which was objected to by the workers and the employer took the stand that the union was precluded from raising disputes involving financial expenditure. It was on this aspect of the matter that the learned Judges of the High. Court held as under which has been relied upon by Mr. Mirza : "The words in the agreement 'undertaking not to raise or pursue during the operation of this settlement any demand involving financial commitments/expenditure direct or indirect on the part of the Company' cannot read independent of clause of the agreement and extend to all demands in dispute in existence upto the time of agreement under/or pending before the Industrial Court. It cannot, therefore, be argued that it was the intention of the parties to say the least of the union that by this agreement they closed the door upon themselves of all those remedies which were open to them under the law for any new dispute which might creep up during the period the agreement subsisted."
14. These observations are specific to the facts of that ease only and have no bearing on this case.
15. The learned Judges, in the same authority have laid down that finality of a settlement is not to be interfered by the Court. The relevant passage which appears at page 134 runs as under :- "The settlement between the parties which are of binding nature according to the agreement, are those which have been clearly delineated in the deed of settlement and its interpretation cannot be extended beyond the specific scope of the subjects mentioned therein. Those are only the matters to which the law has given a sanctity to be binding between the parties. The Industrial Law does not envisage a situation in which the finality of the settlement arrived at between the parties can be interfered with by Courts. It rather enjoins upon Courts to compel the parties to ensure that the settlement carried out for the period mentioned in the agreement itself and neither party is permitted to challenge those matters in the duration of the agreement, but the mere fact that the parties have made a compromise does not oust the jurisdiction of the Court so as to take away its powers to decide about the extent and applicability of the agreement."
16. These cases, viz. PLD 1970 Lah. 129, 1960, 1980 PLC 166, 1966 PLC 279, 1968 PLC 78, 1966 PLC 274 and 1968 PLC 87, it is respectfully observed, lay down the correct law. If the already settled demands were to be repaginated when the earlier settlements were still in force, the consequences will be chaotic resulting in endless litigation. A flood gate of disputes and cases will be opened and no establishment will have a moment of peace which is the principal aim of the Industrial Relations Ordinance. The makers of this statute were not unaware of such a situation. This is clearly indicated by the provisions of section 49 thereof which put a settlement on a different footing than an award in the matter of their respective operative periods. In the case of an award under subsection (1) of section 37, Labour Courts have been vested with powers to reduce the period thereof on the ground that the circumstances in which the award was made have materially been changed.
' No such power has been given in the case of a settlement. Thus, there is no manner of doubt that a settlement is binding for the period specified therein and fresh demands cannot be raised during subsistence of a current settlement, especially when a specific clause to that effect is incorporated in the settlement, in its own right and binding on the parties. Such a clause exists in the settlement between the contesting parties before me. It holds the fields at the moment in the Establishment of Bata Shoe Company. Fresh demands, therefore, cannot be raised at this stage. This preliminary objection is upheld.
17. In view of the above, I hold that this application under section 34-A of the Industrial Relations Ordinance, 1969 is not maintainable and is accordingly dismissed.