PNSC violates the law of superannuation & re-employment

The management of Pakistan National Shipping Corporation (PNSC) has continued violating the law of superannuation and re-employment. What is superannuation and how it had been dealt by federal government in the past? Replying to this query Supreme Court Senior Advocate Hashmat Habib stated that this is a common question being debated by bureaucratic and political circles of the country. In this regard he quoted that there is a case example with reference to the PNSC Board Resolution regarding extension in retirement age of contractual employees from 60 to 65 years passed in its 356th meeting, and again reconfirmed in 357th meeting that was declared null & void, having no legal force.

According to details Habibullah Khan Khattak, Secretary (Ports & Shipping), Government of Pakistan Ministry of Ports & Shipping, Islamabad in his letter dated 13th June, 2014 addressed to Chairman, Pakistan National Shipping Corporation, Karachi had expressed legal opinion regarding re-employment of retired officers due to non-availability of qualified experienced replacement and issued this directive.

By referring the PNSC letter No. CS/12/2014 dated 13th May, 2014 on the subject Habibullah Khan quoted the minutes of 356 PNSC Board of Directors Meeting held on 26th February, 2014 wherein it was resolved that the retirement age of contractual employees should be 65 years based on the recommendation of HR committee of Board of Directors in the interest of Corporation as is practice worldwide.

Khattak said the arguments put forward by the PNSC have thoroughly been examined and were found to be without any legal force and incorrectly applied to this case as discussed below:-

“Article 13 PNSC Ordinance, Administration of the Affairs of the Corporation – (I) Subject to the other provisions of this Ordinance and the rules and regulations, the general direction and administration of the affairs and business of the Corporation shall vest in the Board of Directors, which may exercise all powers and do all acts and things which may be exercised or done by the Corporation.”

Secretary (P&S) said: It is important to note here that the powers of Board of Directors are limited to all acts and things, which may be exercised or done by the Corporation. The interpretation of PNSC Board that the Board is fully independent is not correct e.g. the Board cannot enter into an agreement with a foreign country on its own, allow the Indian vessels to have joint ventures with them or take supplies to Israel, change the budget year, attach itself to another Ministry, start taking directions from the Provincial government or a private organization etc, though none of these restrictions have especially been incorporated in the PNSC Ordinance.

Taking the argument further, Article 21(1) of the PNSC Ordinance, 1979 is interpreted by PNSC that it fully empowers the Board to appoint officer, consultant and advisor etc. This article is reproduced here. PNSC may note that these powers have boundaries.

“Appointment of Officer, etc—-(I) The Corporation may appoint such officers, consultants, advisors and employees as it considers necessary for the efficient performance of its functions, on such terms and conditions as it may deem fit.”

A relevant example from organizations of Ministry of Ports & Shipping is discussed here to demonstrate the limits of “on such terms and conditions as it may deem fit”. A similar section in legislation for Karachi Dock Labour Board (KDLB), Karachi Dock Workers (Regulation of Employment) Scheme, 1973, is Section-6.

“Executive Officer and Personnel Officer, etc—The Board may appoint an Executive Officer, a Personnel Officer and such other officers and staff on such terms and conditions as it may deem fit”.

 In a Misc. Petition No. 16033/2011 in the Honorable Sindh Court, KDLB took shelter of this phrase “on such terms and condition as it deem fit” while arguing case of employment beyond 60 years. It was not accepted; the reference was made to Esta-Code, and held that powers under Section 6 can be exercised only to appoint a person who is eligible for the post. The person who has crossed the age of superannuation does not remain eligible for appointment and cannot be re-employed. This order was passed on 20-12-2012.

Explaining the issue of Policy, the Secretary (P&S) stated: Whether a decision is an issue of policy or otherwise, it is very simple that any decision of the Federal Government or a directive or a circular coming from the Parliament, Chief executive office or such ministries that have an umbrella domain (e.g. Ministry of Finance) are matters of policy unless specifically restricted to a particular organization.

The PNSC Ordinance, Article 13 (2), reads as:- “(2) The Federal Government may, as and when it considers necessary, issue directives to the Corporation on matters of policy; and if a question arises whether any matter is a matter of policy or not, the decision of the Federal Government shall be final”.

Thus, even If this age issue was not there, the extension of contracts, re-employment, taking cover of ‘daily wages workers’ etc are all blatant violations of the ban imposed by the Government circulated vide Memo No. 53/1/2013-SP dated 06-02-2014 and earlier one of 20-06-2013.

Habibullah Khan Khattak further elaborated: There is another issue that PNSC has misinterpreted. When Act, Ordinance, Regulation or Rules are silent about any aspect, situation or nature of an issue, the recourse is made to the general laws, laws of similar bodies or the original source; and in absence of any written legal document, to the spirit. PNSC has a Regulation for employees, other than contract employees, etc.

Article 6 of PNSC Service Regulations 1984 is: “regulations shall be subject to such directives as may from time to time be received from the Federal Government”.

It is to be noted here that if policy directives are followed in case of regular employees, why not the same should be followed in contractual employees; where even otherwise, there is no explicit provision in PNSC Act or Regulation.

It is pertinent here to refer to the relevant pares of Esta Code. S.No. 31 (2), on page 557 has gone to the extent that: “2. In view of the above, all the Ministries/ Divisions are requested to ensure that the instructions already issued by the Establishment Division are complied with in letter and spirit and no officer is allowed to continue in office after superannuation/ on expiry of the period of contract re-employment unless unauthorized overstayal, the financial liability for such an irregularity shall rest upon the head of the department and the officer concerned himself”.

In absence of explicit rules or legislations, such circulars are directives and policy guidelines for PNSC and such other organizations. He said though the current memo is regarding the extension of superannuation age from 60 to 65 years. However, the PNSC is also requested to please keep their argument clear and not to be confused with other issues. They may like to re-examine their viewpoint with the current practice going through the legal definitions and parameters of temporary/ workman, daily wages worker and stipend. I understand that the job of the/ executive director are not essentially of temporary nature with in a period not exceeding 9 months.

Definitely it will become a policy issue of the federal government to stop malpractices if cover of stipend/ daily wages is used with the intention to continue with the officers above 60 years of age or expiry of the contract period and equally all those posts like admn, finance, general engineering and commercial are not of such nature which require high tech, advance qualification are not available in the market.

According to letter; PNSC has mentioned ‘as is practiced worldwide’; but no example of a country with similar conditions and laws of Pakistan have been provided in support. The other point is about the prescribed procedure, whether has been followed or otherwise. In light of the above discussion, the PNSC Board Resolution regarding extension of retirement age of contractual employees from 60 to 65 years passed in its 356th meeting, and again reconfirmed in 357th meeting is declared null & void, having no legal force, Habibullah Khan Khattak-Secretary (P&S) concluded.

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