1976 PLP 227 (PLC)

3. Conciliation proceedings were resumed and a settlement was reached with regard to various demands. The term of settlement with regard to gratuity reads as under That it has been agreed to by both the parties that gratuity will be paid to the workers at the rate of 20 days' basic wages for each completed year of service or part thereof in excess of 6 months in accordance with the provisions of the Standing Orders Ordinance. According to the settlement the gratuity is payable is accordance with the provisions of the Standing Orders Ordinance. Evidently this has reference to Standing Order No. 12(6) of Standing Orders Ordinance dealing with gratuity. It read as under Where a workman resigns from service or his services are terminated, by the employer, for any reason other than misconduct, he shall, in addition to any benefit to which he may be entitled under this Ordinance or in accordance with the terms of his employment or any custom, usage or any settlement or an award of a Labour Court under the Industrial Relations Ordinance, 1969 (XXIII of 1969), be paid gratuity equivalent to twenty days' wages, calculated on the basis of the wages admissible to him in the last month of service if he :e a fixed-rated workman of the highest pay drawn by him during the last twelve months if he is a piece-rated workman, for every completed 3 ear of service or any part thereof in excess of six months."

5. There is, however, a slight change. In the term of settlement word each has been used instead of word every occurring between tae words wages for and completed year . Since the intention is the same, the substitution of one word for the other hardly makes any difference.

6. Taking up the contentions, it has been urged on behalf of the Company that in order to he entitled to gratuity the completion of one year's service is a condition precedent before availing of the benefit extended to the period in excess of six months. This was also sought to be supported by the nature of the demand which has already been reproduced. On the other band it has been urged on behalf of the Union that subject to the condition laid down by the Standing Order No. 12(6), every employee is entitled to receive gratuity if he has remained in service for more than six months irrespective of the fact whether he has completed one year or not.

7. On consideration of the term of settlement in the light of arguments advanced before me, I am of the view that the contention raised on behalf of the Company cannot be accepted. The plain reading of the term of W settlement does not admit of any such construction. It is not disputed that, no such bar has been expressly imposed. It is also not possible to presume any such bar. 8., The expression, for each completed year of service or part thereof in excess of 6 months is in two parts divided by the word or . Each part has to be read independently of the other. In other words the second part is not controlled or qualified by the first part. An employee is entitled to gratuity if his case falls under either part.

9. As a rule gratuity is calculated on the basis of a completed year of service but according to the Standing Order, the benefit has been extended to any part thereof in excess of six months treating it to a completed year. This, in my view, is an exception to the general rule. Consequently it is not necessary, that the period exceeding six months should be in addition to any completed year of service.

10. It has been urged on behalf of the Company that the word or here, stands for the word and , consequently it should be construed accordingly. Indeed, in some cases the use of the word or means and . There is no dispute that when the word or is used in relation to two or more natives it is not necessarily the case that the alternatives are mutually alter. In a proper context, it may mean "and". Conversely this is true exclusive when word and has been used meaning thereby "or".

11. It is, however, to be presumed that the Legislature has used the words in their known and ordinary significance unless the context indicates that such a construction would frustrate the real intention of the Legislature. So the question as to whether the words are mutually exclusive or not, must be determined by applying the general rule that the words should be construed to ascertain the intention of the provision in question to be collected from the whole of its term. This is necessary to carry into the effect the meaning and intention of Legislature.

12. As indicated, the intention of the Legislature has to be gathered from the words and phraseology which has been used in the context under examination. Turning to the term of settlement, word, thereof means of that or it . So it refers to the year. It, therefore, follows that the expression any part thereof in excess of six months" means " for any part of a year in excess of six months . Reading in this way, it becomes clear C that even though an employee has not completed one year of service but has been in service for a period of more than six months, he will be entitled to claim gratuity treating that part as full year.

13. It was next urged on behalf of the Company that in case it was intended to allow gratuity even to those employees who had put in service for less than a year, the first part was redundant and there would have been nothing easier than to have provided that every employee having remained in service for a period in excess of six months shall be entitled to gratuity. This suggestion would have brought about a basic change inasmuch as the gratuity will be payable on half-yearly basis instead of yearly basis. Furthermore, I have already stated that the extension of the benefit of gratuity to the employees having served for more than six months has to be treated as an exception to the general rule. So there is no force in the suggestion.

14. It is anomalous and incongruous to think that if an employee having served for a period of one year, six months and one day shall be entitled to gratuity for two years, there bring no provision for payment of gratuity on pro rata basis, but if an employee's service falls short by one day to complete the year, he is debarred from claiming the gratuity. Such a construction is against the principles of justice, equity and good conscious nor it could be the intention of the Legislature.

15. Turning to the charter of demands, indeed, it was proposed that the gratuity would be payable only to those employees who had completed full one year of service but I have no hesitation in saying that any settlement in terms of the demand being less beneficial than the gratuity allowed under Standing Order No. 12(6) would be hit by the proviso to section 4 of the Standing Orders Ordinance. Moreover, the demand for gratuity was for an amount equivalent to 30 days' wages. In either case the reference to the demand is irrelevant and unavailing.

16. In the circumstances the reference stands rejected.