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39 Abdullah Haroon Rd.
Karachi, 74700
Phone: (021)32727266
(021)32729770
Email: Info@smyaqoob.com
Website: www.smyaqoob.com
Date: 19-12-2022
Circular Number: C-204
The Balochistan Companies Profits (Workers Participation) Act, 2022
The Balochistan Companies Profits (Workers Participation) Act, 2022 has been passed by the Balochistan Assembly on 10-06-2022 and assented by the Governor of Balochistan on 22-06-2022, it has become a law in the Province of Balochistan effective from 22-06-2022. The Act is almost the same as the Federal Companies Profits (Workers’ Participation) Act, 1968 with some changes. Its salient features are given as under: ––
- The Federal Government can pass an Act applicable on the establishments functioning in more than one province (Trans-Provincial establishments) but the provincial assembly cannot pass any act applicable to the establishments functioning in more than one province or its office in Islamabad. Section 2 (c) (ii) of the Act and section 15 of the Schedule does not meet the constitutional requirement and its application on the establishments functioning in more than one province is not legal as the provincial assembly cannot legislate any law coming under jurisdiction of the Federal Government.
- In section 5 of the Act, a Committee of eight members shall be made to represent the Government, the companies and the workers to monitor the implementation of the Act. The Committee may call for such record or information as may be required for purposes of the implementation of the provisions of the Act.
- In section 6, penalties have been raised and certain responsibilities have been put under the Committee instead of the Provincial Government.
- In clause 1 (1) of the Schedule to the Act the scheme applies to all companies engaged in industrial undertakings which meet any one of the conditions, (i) The number of workers employed by the company at any time during a year is fifty or more (ii) The paid-up capital of the company as on the last day of its accounting year is two million or more; (iii) The value of the fixed assets of the company (at cost) as on the last day of the accounting year is two million or more, Provided that for the companies established on or after 1st day of July 2006.
- In clause 1 (b), “clause (iii) shall have effect as if for the figure and word “four million” the figure and word “twenty million” were substituted” by mistake twenty million has been written instead of two million.
- In explanation (a)(vii) a confusion is created that Industrial undertakings also include “Commercial Establishments” as defined under Balochistan Industrial and Commercial Employment (Standing Orders) Act, 2021 whereas in clause 1, and explanation (a) no mention of commercial establishments is present which is in contradiction. Similarly, the Federal Companies Profits (Workers Participation) Act, 1968 does not include or mention commercial establishments.
- By clause 4 of the schedule of the Act, three new categories of the workers have been introduced. These new categories are practical, and never to be obsolete like Federal and Sindh laws. The categories are:-
- Workers drawing average monthly wages not less than the minimum wages for unskilled workers fixed, from time to time, by the Government.
- Workers drawing average monthly wages exceeding the minimum wages for unskilled workers fixed, from time to time, by the Government but not exceeding five thousand rupees in excess thereof.
- Workers drawing average monthly wages exceeding upper level of wages fixed for category 2.
- After clause 4 of the schedule of the Act, there are three explanations, first is about the average monthly wages, second is about if the amount left out of the annual allocation after allocation of units has not been transferred to the Fund established under the laws time being in force, then such amount shall be recoverable under the laws of the Balochistan Revenue Authority as workers welfare fund and third is about the amount left out of the annual allocation after allocation of units under this Act and which has not been transferred since the enforcement of the Constitution (Eighteenth Amendment) Act, 2010 to the ‘Workers Welfare Fund’ constituted under the Workers Welfare Fund Ordinance, 1971, shall be transferred, to the fund duly constituted under the law time being in force within sixty days from the publication in the official Gazette of Government of Balochistan. In all the said three explanations, there is no reference to the Balochistan Worker’s Welfare Fund Act, 2022 which means that when this Act has been passed, Balochistan Worker’s Welfare Fund Act, 2022 has not been made and explanations is about the old left-over amount when Eighteenth Amendment in the Constitution has been made (in year 2010) but the Balochistan Companies Profits (Workers Participation) Act, 2022 has been made in year 2022.
- In clause 12 Balochistan Companies’ Profits Workers’ Participation Committee may, at its own cost, appoint independent accountants for a special audit of the accounts of the Fund.
You are advised to carefully peruse the provisions of amendments and may consult your Labour Law Consultant on the matter.
For M/s S.M. Yaqoob
Industrial Relations Advisers
& Labour Laws Consultants
