1979 PLP 66 (PLC)

Reference was also made to section 40 of the Ordinance, which runs thus; "(1) A settlement shall become effective‑

(a) if a date is agreed upon by the parties to the dispute to which it relates, on such date ; and (b) if a date is not so agreed upon, on the date on which the memorandum of the settlement is signed by the parties. (2) A settlement shall be binding for such period as is agreed upon by the parties, and if no such period is agreed upon, for a period of one year from the date on which the memorandum of settlement is signed by the parties to the dispute and shall continue to be binding on the parties after the expiry of the aforesaid period until the expiry of two months from the date on which either party informs the other party in writing of its intention no longer to be bound by the settlement." According to the learned counsel, subsection (2) makes it abundantly clear that the settlement shall continue to be binding on the parties after the expiry of the aforesaid period until the expiry of two months from the date on which either party informs the other in writing of its intention no longer to be bound by the settlement, and that in the present case there was no such notice from either of the parties, therefore, the settlement dated 3‑8‑1974 was still binding despite the fact that a new settlement had been entered into by the parties in April 1976. That according to the concluding para. of the settlement Exh. P. W. 1/3, it was mutually agreed that till 15th of October 1975 the settlement will remain in force and that during this period no further financial or other demands except bonus shall be raised by the C. B. A. That in the Notice of Demand Exh. P. W. 1/4, at page 7 it has been specifically mentioned by the C. B. A. that agreement dated 3‑8‑1974 has expired and the working committee of the Labour Union in their meeting dated 22‑2‑1976 has decided that the Management should be served with notice under section 26 of the I. R. O. which resulted into the settlement of April 1976, and that section 26 caters for two reason, firstly, that when any collective bargaining agent finds that an industrial dispute has arisen or is likely to arise, the employer, or as the case may be, the collective bargaining agent, may communicate his views in writing to the either parties and after the receipt of this communication the parties have to settle the dispute and if the dispute is settled then an agreement is entered into, and if not then a strike notice or lockout notice is to be served under subsection (3) of section 26, and thereafter the conciliation proceedings commence. That the settlement of 1976 came as a result of the strike notice and the procedure as laid down under section 30 and that all the settlements right from 1972 to 1974 remain binding and effective between the parties as no notice by either party was served under subsection (2) of section 40, and that they were not bound by any of the previous settlements, that all the benefits accruing to the workers of the Union of the Establishment since the settlement of April 1972 are enjoyed by them and they can be enforced under the law. The learned counsel relied on a case reported in 1967 P L C 166, wherein it was held :‑ "From the plain reading of what has been provided in subsections (1) and (2) of section 14 of the Ordinance, one may gather that a settlement arrived at comes into operation on such date as is agreed upon by the parties to the dispute and such settlement remains binding for such period as is agreed upon by the parties. But if a settlement arrived at between the parties to the dispute does not show any agreement between the parties as to the date on which it should come into operation, then it will be treated to have come into operation on the date on which the Memorandum of settlement is signed by the parties to the dispute. If no period of operation is agreed upon between the parties then such a settlement remains binding for one year from the date on which the Memorandum of settlement is signed by the parties to the dispute and this settlement shall continue to be binding on the parties after the expiry of the period of one year until the expiry of two months from the date on which a notice in writing of an intention to terminate the settlement is given by one of the parties to the other party or parties to the settlement." The learned counsel, on similar point, also referred the following authorities :‑ PLD 1970 SC 292; 1972 PLC 190; 1966PLC 70; AIR 1957 Cal. 500 ; AIR 1957 S C 38 ; P L D 1961 S C 393 and P L D 1978 Lah. 955

4. The learned counsel for the respondent raised two preliminary points firstly, that the appellant in his evidence has not said a single word with respect to the appointment of Sardaraz as a Watchman before the learned Labour Court and have merely taken the legal provision of the I. R. O., thus has got no cause of action and secondly, that Sardaraz, who would be affected adversely in case the appeal is accepted, was not a party either before the learned Labour Court or before this Tribunal, and as such the appeal cannot proceed . for non joinder of necessary party. On legal side, the learned counsel contended that when a period has been mentioned in the settlement, notice is not necessary, because the settlement dies of its natural death due to the expiry of the period mentioned therein. In support of this argument he has referred to the following authorities; 1969PLC 341; 1974 PLC Note76at p.52;1977PLC323 The learned counsel further contends that in the settlement Exh. P. W. 1/4, at page 7, it has been mentioned by the appellant Union that the settlement dated 30th August, 1974 has come to an end, therefore, this shall be deemed to be notice under subsection (2) of section 40 of the I. R. O. and that the second portion of the document deals with the notice of demand under section 26(1) and (2) of the I. R. O. because they had to put in fresh list of demands for settlement. That the matter was referred to the conciliator and subsequently a settlement was arrived at which is Exh.. P. W. 1/4. This notice of demand can be treated as notice of termination of the Settlement dated 3‑8‑1974. In this context reliance was placed on 1962 P L C 1559. The learned counsel further contended that if the stand of the appellant is accepted that the previous settlement of 1974 was still in existence, then there was no occasion to set forth another charter of demands which ultimately resulted in settlement of 1976 (Exh. P. W. 1/4), and that some of the demands of the previous settlement were incorporated in this later settlement.

5. He further made an attempt to distinguish the case cited by the learned counsel for the appellant (P L D 1961 S C 393) saying that that was a case of Award and subsection (5) of section 14 of the Industrial Disputes Ordinance, 1959 makes it mandatory to serve a notice for the cancellation of Award, notwithstanding the expiry of the period of the Award, mentioned therein. Further contends that similar point was dealt with in the case cited in P L D 1970 S C 292, referred to by the learned counsel for the appellant.

6. On going through the authorities cited by the learned counsel for the parties, the matter to my mind rests on the provisions of section 40 of the I. R. O., which have been reproduced in para. 3, and it is clear from the reading of this section that a settlement shall become effective if a date is agreed upon by the parties to the dispute, and if a date is not so agreed upon, on the date on which the memorandum of the settlement is signed by the parties. Subsection (2) of this section makes it clear that a settlement shall be binding for such period as is agreed upon by the parties, and if no such period is agreed upon, then for a period of one year from the date on which the memorandum of settlement is signed by the parties, and it is to remain in force after the expiry of the aforesaid period until the expiry of two months from the date on which either party informs the other party in writing of its intention. Here in the instant case also a period was specified which was 15th October, 1975, and the words are that it has been decided by the parties that the settlement would remain in force upto the 15th of October, 1975 from the date of signing by the parties. Therefore it is futile to argue that the settlement Exh. P. W. 1/3 still remains in force. I find no merits in this appeal which is dismissed with no order as to costs. Appeal dismissed.