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Is Industrial Relation Act (IRA) 2012 Enough?


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Mubashir Qayyum 15-12-2023
Strong unions mean a strong middle class and a strong middle class means a strong economy”

~ Abraham Lincoln

Amidst the evolving global economy, where the rights of workers and equitable labor practices are at the spotlight, nations are strengthening their labor laws and empowering their workforce. Pakistan has a labor force participation of approximately 71.76 million and an employed force of 67.25 million out of a total population of 231.4 million, the overall employment-to-population ratio stands at 42.1%. Where Pakistan has marked significant success in transforming its industrial relations laws with the most recent enactment of the Industrial Relations Act (IRA) 2012, one question arises: Is IRA 2012 enough?

In Pakistan, trade unions, the cornerstone of labor movements, represent workers and speak out for their rights and welfare. A trade union is a formally organized group of employees who negotiate with their employers for fair working conditions, wages, and benefits. These unions are essential for protecting workers’ rights, advancing job security, and fostering a safe work environment.

Imagine a nation of 231.4 million souls with only a workforce of 71.76 million people toiling day and night. According to the International Labor Organization’s (ILO) study: only 1% (1,414,160 out of 231,400,000) of Pakistan’s workers are protected by the meager 7,096 trade unions. The registrations of trade unions have been influenced by the evolution of industrial relations laws, which have provided varying definitions of the term “worker” or “workman” over time. This is explained in more detail below:

The Evolution of Industrial Relations Laws:

Pakistan’s journey in strengthening workers’ rights is indebted to the International Labor Organization’s (ILO) conventions. It became a signatory to the ILO after independence in 1947 and marked a significant milestone as it ratified Convention 87, emphasizing the workers’ right to organize, and Convention 98, prioritizing collective bargaining. These pivotal conventions helped create a robust framework of worker-employer relationships, safeguarding of the fundamental rights of the workers. 1958’s abolishment of the Trade Union Act and the Trade Dispute Act of 1947 by General Ayyub Khan halted the registrations of trade unions, thereby further disbanding the already registered unions.

Despite this hitch, the Industrial Relations Ordinance (IRO) of 1969 was introduced, resurrecting the formations of the trade unions. This ordinance incorporated a non-partisan or apolitical trade-union model which restricted the selection of trade union’s leadership to the factory level and introduced a unique Collective Bargaining Agent (CBA) system. As per s. 15(3)(c) of the IRO 1969, this system required 75 percent of any establishment or industry members to declare their employers, inadvertently fueling a division amongst trade unions and spawning their proliferation. Under this system, the trade unions within the essential services sectors (education, healthcare, transportation, etc.) were wholly prohibited from organizing “strikes” against their employers, which resulted in a decline in the registration of the trade unions and the trade union movements.

From General Ayyub’s Martial law to Zulfiqar Ali Bhutto’s regime to PMLQ’s Zafarullah Khan Jamali’s tenure in 2002, various amendments reshaped labor law, culminating into the promulgation of Industrial Relations Ordinance (IRO) of 2002 superseding the IRO of 1969. IRO 2002 did not incorporate any significant developments in the law. It merely reorganized the scattered provisions in IRO 1969, which were difficult to comprehend, eradicating the ambiguities in IRO 1969.

Subsequently, under Yousuf Raza Gillani’s regime, Pakistan People’s Party enacted the Industrial Relations Act (IRA) in 2008 which further constricted labor-industry relations. Notably, both the IRO 2002 (section 1(4)) and the IRA 2008 (section 1(3)) excluded vital sectors from the Industrial Relations jurisdiction, including employees of law-enforcement agencies, Pakistan International Airlines (PIA) security staff, wage-earners above pay group V, government hospitals and educational institutions, as well as the self-employed and agricultural workers. Strikingly, this collective exclusion which amounts to approximately 70% of Pakistan’s labor force, significantly affected protective reach of the IRA.

Distinction between the application of IRO 1969, IRO 2002, and IRA 2008:

Pakistan’s governments have had a challenging time defining the “worker” or “workman.” The question that comes in mind is – why is there no common and one acceptable definition of a “worker”?

The collective wisdom of the legislature in having varying definitions across distinct labor laws such as the Industrial and Commercial Employment (Standing Orders) Ordinance 1968; Factories Act 1934; Payment of Wages Act 1936; Employees Old-age Benefits Act 1976, IRO 1969, IRO 2002 and the IRA Act 2008. The wisdom is to provide benefits to a specific category of workers commonly referred to as ‘non-management employees’ or ‘unionized employees’.

The term “Worker” as defined in IRO 1969 in S. 2(xxviii) is an employee, excluding managers, supervisors earning wages exceeding Rs. 800 per mensem, or managerial functions. However, it was amended by IRO 2002 which simplified the definition of “workman” in S. 2 (xxx) and only made it applicable to persons other than those employed mainly in a managerial or administrative capacity. IRA 2008 in S. 2 (xxix) again amended the definition of the “workman” and included the supervisors in the application of the IRA.

The Promulgation of the Industrial Relations Act (IRA) 2012 and The Definition of “Worker” or “Workman”:

As of today, Industrial Relations Act (IRA) 2012, which provides the legal framework governing the formation and operation of trade unions in Pakistan, has been promulgated with various amendments including an amendment in the definition of the “worker” or “workman”.

This Act in S.1(3)(b) extended the scope of its applicability to the workers employed in any establishment or industry or even employed as workmen in the administration of State. It is evident from the recent Supreme Court judgment in 2022 SCMR 292 that:

“ It is clear that the Industrial Relations Act, 2012 is applicable to all persons employed in any ‘establishment’ or ‘industry’, in the Islamabad Capital Territory or any trans-provincial authority carrying on business ‘in more than one province’ but shall not apply to any person inter alia employed in the administration of the State, other than those employed as ‘workmen’. Prior to Industrial Relations Act, 2012, Section 1(3)(b) of the Industrial Relations Ordinance, 2008, provided that it shall not apply to any person employed “in the administration of the State other than those employed as workmen by the Railway and Pakistan Post”. In section 1(3)(b) of the Industrial Relations Act, 2012, the words “by the Railway and Pakistan Post” have been deleted, therefore, now all the persons in the administration of the State employed as workmen have been made subject to Industrial Relations Act, 2012, instead of only workmen of Railway and Pakistan Post. …”

Furthermore, as per the judgment in ICA No. 1 / 2016, Islamabad High Court on 22-06-2023 also stated as following:

Literally interpreted, Section 1(3)(b) of the I.R.A.-2012 does not make the provisions of the said Act inapplicable to persons employed as workmen even though they may be employed in the administration of the State. The words “other than those employed as workmen” in Section 1(3)(b) of the I.R.A.-2012 saves such category of persons employed in the administration of the State from the inapplicability of the said Act. Therefore, it is safe to hold that the provisions of the I.R.A.-2012 are applicable to the workmen employed by the F.B.R.

The “workmen” is defined under S. 2(xxxiii) of the IRA 2012 and in this Act the legislator has termed workmen as someone who is not an employer as per S. 2(ix) of the IRA 2012. This means that all those workers or workmen employed in the administration of state and which fall in the definition of employer under S. 2(ix) of the IRA 2012 will attract the provisions of IRA 2012.

Adequacy of IRA 2012 and Reforms:

The state has employed 3.2 million bureaucrats to govern the employed labor force of 71.76 million. In a nutshell, no, IRA 2012 is not enough. Despite the enactment of the IRA 2012, it fails to adequately protect the labor community’s rights which are the spirit of IRA 2012 and the promises to International Labor Organization. The bureaucracy takes the advantage of a deeming clause “shall be deemed” in section 2(1)(b) of the Civil Servants Act (CSA), 1973 that has allowed to enjoy the status of civil servant, even to those persons who were excluded from its definition. So that an employee shall not fall under the definition of “workman” as defined in S. 2(xxxiii) of the IRA 2012.

It is concerning that the persistence of treating definitions of “Service of Pakistan” in Article 260 of the constitution and “Civil Servants” as defined in the CSA 1973, as synonymous, unjustly denies workers or laborers, the full scope of labor protections they rightfully deserve. This persistence effectively equates lift operators, drivers, or gardeners employed within departments associated with the Federation or All-Pakistan Service with the category of civil servants.

A deeming clause allows for a conceptualization of a particular scenario, but it cannot supersede the inevitable consequences tied to that scenario. Therefore, solely based on this conceptualization, an individual’s status cannot be altered without ensuring compliance with fundamental requirements. Those persons employed in Federation-associated departments like FBR, WAPDA, NEPRA as workers or workman, shall not be deemed to be employed as Civil Servants merely because they are employed in a department which works for the Service of Pakistan. The members of Armed Forces, however, fall in the category of “Service of Pakistan” but they are not termed as Civil Servants as per the Civil Servants Act 1973 or the Service Tribunals Act 1973. There are concerns regarding the legitimacy and equity of the appointments of contract employees, the ones on deputations, or those without formal appointment procedures, as this assumption is wrong, that they are “Civil Servants.” It is also unclear that whether these appointments under CSA 1973 had any legal authority and whether such authority exercised its discretion fairly or in good faith or there is any ulterior motive involving mala fide etc.

Parliament has, by legal fiction, termed the status of civil servants to those employed in the department as “worker or workman” under other laws which works in connection with the Federation. Article 260 of the constitution empowers the Parliament to term any service as the service of Pakistan in terms of the CSA 1973. But it does not empower the Legislature to declare any person to be in the service of Pakistan, on the basis of a legal fiction.


In conclusion, IRA 2012 alone is not enough to grant workers employed in the administration of state and federal departments their constitutional right of freedom of association, collective bargain, right to assemble, and strike. The practical implementation of IRA 2012 will continue to face hurdles unless effective policies and legal amendments are introduced. While the Islamabad High Court’s recent judgment in ICA No. 1/2016 extended the IRA 2012’s scope to federal employees, there remains an imperative need for comprehensive legal developments, enabling the registration of federal trade unions. This accentuates the ongoing necessity for cohesive legal frameworks and vigorous measures to ensure equitable rights and protections for all workers across diverse sectors in Pakistan.

It is the duty and the competence of the Legislature to specify and differentiate civil servants and workman in drafting legislations for the regulations of labor rights in government-controlled departments. Until Parliament addresses this through effective legislation, this issue will persist with less labor representations in Pakistan. The bureaucracy will continue to take advantage of the legal fiction, labeling workers as civil servants, denying them the right to unionize, and leverage collective bargaining for their labor rights.

  1. chrome-extension://efaidnbmnnnibpcajpcglclefindmkaj/
  9. Federation of Pakistan v. Muhammad Azam Chattha (2013 SCMR 120)
  10. Registrar, Supreme Court of Pakistan v. Wali Muhammad (1997 SCMR 141)
  11. Mubeen-us-Salam v. Federation of Pakistan (PLD 2006 SC 602)
  12. Ibid
  13. The Supreme Court’s Civil Appeal No. 491 OF 2012 and others decided on 17.08.2021
  14. Federation of Pakistan v. Muhammad Azam Chattha (PLD 2006 SC 602)


Disclaimer: The views expressed in this article are solely those of the author and do not necessarily reflect the opinions or perspectives of the Legal Research Paradigm Society. The Society holds no responsibility for the content presented herein.

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