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Employees working beyond Nine Months gains status of Permanent Worker under Labor Laws, and Terminations must be in Writing --- Supreme Court of Pakistan

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Employees working beyond Nine Months gains status of Permanent Worker under Labor Laws, and Terminations must be in Writing --- Supreme Court of Pakistan

Islamabad 07-09-2024: In a significant ruling, the Supreme Court of Pakistan dismissed civil petitions filed by Town Municipal Administration Chak Jhumra, affirming the reinstatement of two municipal workers, Muhammad Khalid and Muhammad Iqbal Javed, whose services were terminated verbally without written orders. The Court ruled that both workers were entitled to reinstatement with back benefits, solidifying their status as permanent employees due to their extended periods of service.

The case, titled [Civil Petitions No. 2697-L/2016 & 2698-L/2016], centered around the unlawful termination of the respondents, who had been working for more than nine months, a period which, under Pakistan’s labor laws, grants workers permanent status. The workers filed grievance petitions under Section 33 of the Punjab Industrial Relations Act, 2010 (PIRA), and the Labour Court ruled in their favor, directing the Town Municipal Administration to reinstate the employees. The ruling was later upheld by the Punjab Labour Appellate Tribunal and the Lahore High Court.

The Court emphasized that both workers had been employed for long periods Muhammad Khalid for three years and Muhammad Iqbal Javed for six years against permanent posts. As per the Industrial and Commercial Employment (Standing Orders) Ordinance, 1968, any employee working beyond a probationary period of nine months attains the status of a permanent worker. The petitioners’ attempt to classify them as temporary workers was dismissed as a misuse of labor laws to avoid regularization of services.

The Supreme Court of Pakistan strongly condemned the practice of oral or verbal termination, stating that employment can only be terminated with a written order explicitly stating the reasons for termination, as required by Standing Order 12 of the Ordinance 1968. The Court referred to its earlier decision in Chairman Agriculture Policy Institute, Ministry of National Food Security & Research, Government of Pakistan Vs. Zulqarnain Ali (2022 SCMR 636), reiterating that verbal terminations are unlawful and contrary to principles of natural justice.

The Town Municipal Administration’s appeals to the Punjab Labour Appellate Tribunal were dismissed for being time-barred, and the petitioners sought condonation of delay in filing the appeal. The Supreme Court of Pakistan found no valid reason for the delay and reaffirmed the principle that government entities are not entitled to preferential treatment in such cases. The Court cited its ruling in Regional Police Officer, Dera Ghazi Khan Region Vs. Riaz Hussain Bukhari (2024 SCMR 1021), asserting that the law aids the vigilant, not those who sleep on their rights.

The ruling underscored the importance of workers’ rights, particularly the right to seek redress for unlawful termination. Both respondents, who had been dismissed without just cause, were entitled to reinstatement with full back benefits. The Court noted that such workers, having served for long durations, had effectively gained permanent status under the law, despite being classified as daily wagers.

This decision is expected to have far-reaching consequences for employers, particularly those in government institutions, reinforcing the requirement to adhere strictly to labor laws regarding termination and the classification of workers. It highlights the judiciary’s role in protecting workers’ rights, particularly in cases where employers seek to circumvent labor laws by misclassifying employees as temporary or terminating them without due process.

The judgment also serves as a reminder that government departments are not exempt from the rules of limitation and must act promptly in filing appeals or risk losing the right to be heard.

The Supreme Court’s decision is hailed as a victory for labor rights and is expected to strengthen the legal protections afforded to workers across Pakistan.

This ruling will now be referenced in future labor disputes, particularly concerning issues of wrongful termination, oral dismissals, and the permanent status of workers employed beyond their probationary periods.