Pakistan Case Law1986 PLC 21
This application was filed under Section 50 of the Industrial Relations Ordinance, 1969, seeking an interpretation of clause (9) of a Memorandum of Agreement entered into between Glaxo Laboratories (Pak.) Ltd. and its employees' union regarding gratuity payments. The core legal question was whether the phrase "15 years or more" in clause (9)(a) of the agreement, which governs gratuity entitlement, should be interpreted as limited to a maximum of 20 years of service based on an illustrative schedule provided in the text, or if it extends to any number of years beyond 20. The Tribunal held that the words "or more" are unambiguous and do not limit the period of service to 20 years. It concluded that the schedule provided in the agreement was merely illustrative and not exhaustive. Consequently, the Tribunal ruled that the company cannot restrict gratuity calculations to a maximum of 20 years of service. The application was allowed, and the clause was interpreted to include service years beyond 20. The key principle established is that where a contractual provision uses the phrase "or more" regarding years of service, an accompanying schedule listing specific years is considered illustrative rather than an exhaustive limitation.
- Does the phrase '15 years or more' in a gratuity clause limit the entitlement to a maximum of 20 years of service?
- Is a schedule of gratuity payments provided in a collective agreement considered exhaustive or illustrative when the text uses the phrase 'or more'?
- Can an employer restrict gratuity calculations to 20 years when the agreement specifies '15 years or more'?
DECISION
This is an application under section 50 of the Industrial Relations Ordinance, 1969 to interpret clause (9) of memo. of Memorandum/ Agreement entered into by Glaxo Laboratories (Pak.) Ltd., Karachi and its employees union.
2.Mr. Chaudhry Rasheed Ahmad, Advocate, argued on behalf of the Union while Mr. S. Qamaruddin Hassan, learned counsel has argued on behalf of the Company.
3.This agreement was entered into on 1‑7‑1982 and was in operation upto 30‑6‑1984. While, the present application for interpretation was filed on 30‑10‑1983. By the time this application got interpreted by this Tribunal, there might yet be another settlement between the parties. However, clause (9) of the agreement, in question, reads as under:‑‑
"(9) GRATUITY:
Number of years of completed service.
Gratuity amount
300 days
320 days
340 days
360 days
380 days
400 days
Number of years of completed service.
Gratuity amount
100 days
121 days
144 days
169 days
196 days
4.The difficulty was that in the words of clause (a) of the agreement, quoted above the years contemplated were 15 years "or more". The difficulty was that the words "or more" in ordinary context would mean 15 years or more upto any number of years. It would not limit to completed years only to 20 years. The arguments of Mr. S. Qamaruddin Hassan, the learned counsel were that because in the following Schedule given below the clause (a) only 20 years are mentioned, hence, the interpretation of the words "15 years or more" would be limited to 15 years upto 20 years. The arguments of Ch. Rasheed Ahmad, the learned counsel were that the Schedule was only illustrative and was not exhaustive. To this, he has referred earlier agreements, namely, agreement ending on 30‑6‑1980 which expressly mentions the completed years of service from 15 to 20 years of completed years of service. The very preamble of the agreements entered into byl the parties indicate that maximum years are mentioned to be 20 years. Only the agreement ending on 30‑6‑1984 mentions completed years 151 years or more. The word "or more" mentioned in number of completed years may be 21, 22 or 23.
5.There is no ambiguity in the words "or more" and it mentions completed years to be more than 20 years. The Schedule given below is only illustrative. Mr. Qamaruddin Hassan's arguments are not sound.. The Management of the Company cannot refuse the calculation on the basis of new clause to limit the service completed years to years 20 in B number. My interpretation is that the word "or more" do not limit the period of service to be 20 years.
M.I.
Orders accordingly
Judges on this bench
- Ali Nawaz Budhani721 judgments