DECISION ' These are five appeals directed against the orders of Fifth Sindh Labour Court, Karachi, passed in petitions under section 25-A of the I.R.O. Whereby all the five petitions of the appellants for reinstatement in the service of the Respondent Companies were dismissed as not being maintainable.
2. Since all these five appeals for reinstatement have been filed on similar facts and grounds, they have been heard together and will be disposed of by this common decision. The two appeals of Ghulam Rabbani, a despatcher and Abdul Rehman, Executive Imports Clearance Clerk are against M/s. Ghandhara Nissan (Pvt.) Limited while the three remaining appeals of Abdur Rashid khan, a Supervisor, Riaz Ahmed, an Office Assistant and Shafi Muhammad, a Stenographer are against M/s. Daihatsu Motors Pakistan (Pvt.) Limited, Karachi for retrenchment of their services on account of reorganization.
3. It is the case of the appellants, as stated by their common representative Mr. Abdul Majeed, that the respondents are a Group of Companies known as (1) M/s. Ghandhara Nissan (Pvt) Limited (2)
M/s. Daihatsu Motors Pakistan (Pvt) Ltd. And (3) Ghandhara Nissan Diesel Limited, Karachi. That they all have same Directors and Management and do the business of selling, repairing, assembling and manufacture of automobiles from Japan. That since Company No, (3) is dealing with the factory only it has been left out and the first two Companies have been impleaded in these petitions. That these Companies have their Office premises at 109/2 Clifton known as "Ghandhara House", Karachi and all the three Companies employ 257 to 259 workmen. Mr. Abdul Majeed has further stated that these workmen are transferable from one Company to other Company and he has cited the example of appellant Muhammad Shafi, who had been transferred by a Written Order on 14-6-1984. From Ghandhara Nissan (Pvt) Limited to Daihatsu Motors Pakistan (Pvt.) Ltd.
4. Mr. Abdul Majeed has also stated that there is a common attendance register for all the workmen numbering more than 200 and he has pointed out a Blank Muster Roll Form with some typed names of workers numbering 75 with the heading "Ghandhara Nissan (Pvt.) Limited Daihatsu Motors Pakistan (Pvt.) Ltd. Ghandhara Nissan Diesel Ltd. But it is just a Form and does not show when or where it was ever used. According to him there were 75 employees in the Commercial Establishments apart from those working in the factory in the different companies. That this was a consolidated form used by all the different Companies. Mr. Abdul Majeed has also mentioned that there is no separate register of employees kept by the company but these Companies together employed more than twenty workers in their combined Commercial Establishments. He has, thus, argued that a Group of Companies can have one commercial establishment. Since this commercial establishment employed more than 20 workers they formed the union and applied for registration under section 9 of the I.R.O., 1969. That while the registration proceedings were pending the management of the three Companies terminated the services of the five appellants under Order 12(3) of the West Pakistan Industrial and Commercial Employment (Standing Orders)
Ordinance, 1968. The reason mentioned being Re-organization. That under section 8-A of the I.R.O.
No workman shall be discharged during the pendency of an application for registration of the Trade Union with the Registrar, the contravention of this section being punishable as an 'unfair labour practice' under section 53 of the I.R.O., 1969.
5. Mr. Abdul Majeed has stated that he has actually filed a complaint against the Management for criminal liability. The Union was registered on 29-8-1989 but the services of the appellants were terminated on 2-8-1989 during the pendency of the registration proceedings. That this case is still pending before the Court.
6. It has, on the other hand, been argued by Mr. Rehan Aqeel, on behalf of the Companies, that these Companies are independent and separate Companies having separate units of commercial and industrial establishments. That they are individually registered under the West Pakistan Shops and Establishments Ordinance, 1969. That one Company can have several establishments but several Companies establishments cannot be consolidated into one establishment as there is no authority in any enactment permitting this type of practice. The learned Advocate has further pointed out that while Ghandhara Nissan (Pvt.) Limited employ 15 workers, Daihatasu Motors Pakistan (Pvt.) Ltd. Employ only 5 workers. That the third Company Ghandhara Nissan Diesel Limited is not a party in any of these five appeals.
' The learned Advocate has pointed out that these Companies are maintaining separate commercial and industrial establishments and their workmen do not constitute a common pool.
That the case of transfer of Shafi Muhammad is a solitary instance where the services of Shafi Muhammad were terminated in one company and permanently allocated to the other company.
Shafi Muhammad was paid all his dues by Ghandhara Nissan (Pvt.) Limited and he was employed by Daihatasu Motors Pakistan (Pvt.) Ltd. On separate terms and conditions as to salary, house rent, conveyance and medical charges etc. All this is mentioned in the order referred to by the Representative for the appellants.
7. Regarding the form of attendance sheet of 75 workers Mr. Rehan Ageel has pointed out that this form was not shown to any of the witnesses for the respondent companies in cross-examination.
Nor has this form been produced through any responsible witness to prove its authenticity. The appellants have failed to explain how or from whom they obtained this blank unused form which does not bear the signature of any worker nor any date showing that it was ever used. Mr. Rehan Aqeel has referred to the attendance sheets produced by the respondents and signed by the workers. These attendance sheets show that there were six persons on the register of Daihatsu Motors Pakistan (Pvt.) Ltd. And these have been produced by Abdul Rashid in cross-examination and admitted that they bear his signature. Under the West Pakistan Shops and Establishments Ordinance each establishment has to maintain the list of workers giving all the details and this was being complied with by the commercial establishment units of these Companies.
8. Regarding the formation of a common Trade Union it is an admitted fact that the workers of different establishments can associate together to form the common union in order to seek redress for their common grievances but that will not provide them the facility of application of the Standing Orders or the I.R.O. As claimed by them. This matter of registration of the Union has been called in question by the respondents who have filed the Constitutional petition in the High Court and I will not dilate on this issue any further because the matter is sub judice before the Division Bench of the High Court. I would, however, quote the observation of their Lordships in a similar case of M/s. Agha & Company v. Mari Gas Co. Ltd. 1994 PLC 85. Their Lordships referred fo the definition of Trade Union given in clause (xxvi) of section 2 of the Industrial Relations Ordinance, 1969 which reads as follows: 'Trade Union' means any combination of workmen or employers framed primarily for the purpose of regulating the relations between workmen and employers or workmen and workmen or employers and employers or for imposing restrictive conditions on the conduct of any trade or mess and includes a federation of two or more trade unions." '"
' It was observed: "that there is nothing in the above defmition to show that a trade union representing the employees of more than one establishment cannot be formed It appears to us that the expression 'group of establishments' used in these sections is of wide connotation and includes independent establishments accordingly we find ourselves unable to agree with the contention of Mr. Shabbir Ahmed Awan that a Trade Union representating the workers of group of establishments can be registered only if the establishment in the group are owned by or belong to the same employer."
' Thus, the question of formation of a trade union and its registration is a separate question altogether and it does not affect the contention of the respondents that they were registered under the Shops and Establishments Ordinance individually and had only 5 and 15 workers on their registers.
9. The main question for determination in these appeals is whether there were twenty or more workmen employed in the establishment in which the appellants were working so as to bring them within the scope of the Standing Orders Ordinance. In other words it has to be ascertained whether the law contemplates such number of workers in each establishment individually or the group of establishments can be regarded as one establishment for the purpose of counting the number of employees. For this purpose the burden of proof will be on the party that asserts the proposition that they fall within the definition of workers in any Industrial or Commercial Establishment employing twenty or more workmen. Otherwise the provisions of the Standing Orders Ordinance will not be applicable to their case and they will continue to be members of the staff under the Shops and Establishments Ordinance.
10. The respondents have led evidence to show that they are registered under the Shops and Establishments Act and they do not employ twenty or more persons. This fact has not been controverted or rebutted by the appellants in cross-examination. There are number of decisions on the point that where the number of workmen, whether more than 19 in an establishment, is disputed the burden of proof is on the party asserting the same under section 101 of the Old Evidence Act, or Article 119 of Qanun-e-Shahadat, 1984. My learned predecessor Mr. Justice (Retd.)
Z.A. Channa held in a similar case of Awan Industries v. Sarfraz Khan and 2 others 1981 PLC 45 that: "It has repeatedly been held by this Tribunal that where it is denied by an establishment that it was employing 20 or more workmen, the burden of controverting this fact and proving that the Standing Orders Ordinance were applicable to it, lay on the workmen making such claim."
' In the case of Recha Pakistan Limited v. Abdul Ghaffar Virani reported in 1993 PLC 2 it was held by Mamoon Kazi, J.
"Employee in his grievance petition though had asserted that the number of workmen employed by employer was more than 20, but had not supported his assertion either by his affidavit-in- evidence or any other reliable evidence 'Employers in their written statement had categorically stated that number of workers employed by them was less than 20, thus Standing Orders Ordinance, 1968 was not applicable to them Burden, in circumstances, was on employee to prove that employer had employed 20 or more workers during preceding year and that Trial Court was vested with jurisdiction to try his case, but failed to prove same Appellate Court below had berred in holding that burden was on employer to establish that number of workmen employed by them was less than 20."
11. But in these appeals the appellants as workers have signed the list of workers in each separate establishment which shows that these establishments were employing less than 20 workers each.
The Representative for the appellants, however, contend that since these establishments work under the same roof and were owned by the same Directors they could be regarded as one consolidated establishment even though each unit belonged to a separate Joint Stock Company.
Section 2(b) of the West Pakistan Industrial and Commercial Employment (Standing Orders)
Ordinance, 1968 defines "commercial establishment" as a unit of a Joint Stock Company but does not include in the definition several units of several companies to be considered as one consolidated unit for the purpose of counting the number of workmen. In the case of Abdul Waheed v. Brooke Bond (Pakistan) Ltd. Reported in 1990 PLC 462, the respondent company had several units registered under the Shops and Establishments Ordinance, 1969. Each unit employing less than twenty workers it was held: "That workers employed in each such Branch were not entitled to file grievance petition against the company for their removal from service."
' It was also observed in a similar case reported in PLD 1978 Kar. 649 by Tufail Ali, C.J. And Fakhruddin, J. In Constitution petition before the Karachi High Court, that the learned counsel is clearly in error in the meaning that he seeks to give to the expression 'establishment' which is defined in Industrial Relations Ordinance, 1969, as follows: "'Establishment' means any office, firm, industrial unit, undertaking, shop or premises in which workmen are employed for the purpose of carrying on any manufacturing process, business, trade or service."
From the above definition it would appear that an employer may have more than one establishment, for example offices in a commercial area, shops in business area or one or more industrial unit in an industrial area and the expression 'establishment' would include not whole of the establishments of an employer but each of them individually. In another decision of Karachi High Court in the case of Ihsan Sons Limited v. Abdul Razak Habib and 2 others 1987 PLC 390 it was stated in the similar case by Haider All Pirzada, J. That: "Mere fact that a company, individual association of individuals runs or sets up separate establishment at different places would not authorise treating all such establishments, to be one establishment either for the purposes of Industrial Relations Ordinance or Standing Orders Ordinance, even if there was a provision for transfer of staff from one establishment to another."
12. Thus, it has been sufficiently established from the above decisions that where the number of workers in each establishment is less than twenty, the establishments cannot, by any stretch of imagination, be joined together for the purpose of showing the number of workers to be more than twenty. West Pakistan Industrial and Commercial Employment (Standing Orders) Ordinance and Industrial Relations Ordinance would not be applicable to the case of workers in such event and their petitions under section 25-A of the Industrial Relations Ordinance, 1969, against termination of service will not be maintainable.
13. The case of the Companies is that they terminated the services of some of the workers legally after notice as a result of re-organisation because the Auditors had pointed out losses on account of excessive expenditure of establishment. Re-organisation is a right of the Management which has not been taken away by the Standing Orders Ordinance or the Industrial Relations Ordinance, 1969.
The Standing Orders, on the other hand, have provided procedure under section 12 for terminating the services of such workers as are not required. An employer has full liberty under such circumstances to terminate the services of permanent workers by giving one month's notice or one month's pay in lieu of notice thereof alongwith gratuity and other legal dues where the termination has been affected bona fide for reasons of retrenchment etc.
14. In the case of Muhammad Siraj-ud-Din v. Labour Appellate Tribunal and another reported in 1983 PLC 1286 it was held by Abdul Hayee Kureshi, C.J. And Munawar Ali Khan, J. That: "termination of service on account of retrenchment due to reorganisation, challenged on the ground of mala fide where the petitioner had failed to prove that termination of his services was in any way mala fide, it was observed that the employer was free to make re-organisation as was necessary and in consequence thereof retrench as many members of establishment as found redundant."
' In another case of Zeal Pak Cement Factory Limited v. Chairman, Industrial Court reported in PLD 1965 SC 420 it was held by Cornelious,CJ., S.A. Rahman, Fazle-Akbar and Hamoodur Rahman, JJ.
That: "'Discharge' of redundant workers after notice as a measure of 'reorganisation' carried out for bona fide purpose of industry', without any taint of victimisation, does not attract control of Industrial Court."
' In the course of judgment by Cornelius, CJ., it was observed: "In the present case, there is no manner of doubt that there was a reorganisation carried out for a bona fide purpose of the industry, and the notice of discharge was given exclusively in relation to the ,redundancy which thus resulted and without any taint of victimisation. There was nothing in the nature of punishment or vindictiveness involved. We consider that the action of the Factory in respect of the employees retrenched in this case as surplus to requirements being bona fide, it did not attract the control of the Industrial Court under section 30 of the Ordinance, and we accordingly allow this appeal and set aside the order of Chairman directing the re-instatement of these 19 workers. We make no order as to costs."
15. Even where the termination was during the pendency of application for registration under section 8-A of the I.R.O., 1969, it was observed by Nasir Aslam Zahid, C.J., in the case of Messrs Shaheen Airport Services v. SLAT and 2 others 1992 PLC 284, as under: "Termination simpliciter is not covered by section 8-A. For the employee, whose services have been dispensed with and who wants to take benefit of section 8-A, it has to be shown that the termination was by way of discharge, dismissal or by way of punishment. Termination simpliciter which is not discharge, dismissal or by way of punishment and which is otherwise valid in law, is not hit by section 8-A. To this extent, therefore, the submission of the learned counsel for the petitioner is correct."
16. But the above discussion regarding right of the Management to retrench workers on account of re-organisation is only of academic importance because the appellants have failed to establish that they were employed in establishment having twenty or more employees each and the Standing Orders Ordinance and Industrial Relations Ordinance would not, therefore, be applicable to their case specially when it has been shown that the establishments were registered under the Shops & Establishments Ordinance. In the case of Muhammad Bashir Saeed Khan v. M/s. A.L.
Farooki & Company and others reported in 1993 PLC 381 it was observed by my learned predecessor Agha All Hyder, Appellate Tribunal, that: "Where the post which employee was holding was abolished due to re-organisation of office of employers and services of the employee wei-e terminated on that ground and the employee failed to prove by any evidence that number of employees working with employers was twenty or more than that the Trial Court rightly found that provision of Standing Orders Ordinance were not applicable to the case."
17. As regards the case of the workers under the Shops & Establishments Ordinance, section 19 of the Ordinance reads as under: "19. Termination of employment.---(1) For terminating employment of a permanent employee, one month's notice in writing shall be given either by the employer or by the employee and in lieu of notice, one month's wages calculated on the basis of average of wages earned during the proceeding three months shall be paid."
' The plain reading of the aforesaid provision show that a permanent employee's employment could be terminated with one month's notice in writing or one month's wages in lieu of notice under the Shops & Establishments Ordinance.
18. The only question that remains is whether the termination of the appellant workers was mala fide as they had formed a Union by joining the workers of other establishments. In this connection the respondent companies have produced Auditors Report to the Shareholders with Statement of Expenditure and Balance-sheets of Profits. The re-organisation was necessitated by the Auditors Reports and the redundant workmen were given notices of termination. These facts have not been controverted by the appellants. The burden of proving mala fides is on the appellants. Mere joining the Union cannot be regarded as the reason for termination. There was no proof of any dispute with the Union.
19. In the result I can see no reason to interfere with the findings of the Labour Court. The decision of the Labour Court is maintained and these five appeals are dismissed.