1982 PLP 325 (PLC)

Iftikhar Ahmad Dar for Appellant. Sadiq Hussain for Respondent. Date of hearing: 15thDecember, 1981. JUDGMINT These appeals bearing Nos. 273 to 284 of 1978 against various orders passed by the Social Security Court, Punjab, Lahore, call for interpreta tion of the term 'wages' as defined in subsection (30) of section 2 of the Punjab Employees' Social Security Ordinance, 1965 (X of 1965), so as to determine whether or not 'attendance allowance' paid by the respondents in appeals Nos. 274 and 281 of 1978, and 'house rent allowance' paid by the respondents in other appeals to their respective employees fall within its‑scope. The Social Security Court set aside in appeal the orders of the appellant, Punjab Employees Social Security Institution, calling upon the respondents to pay contributions on the attendance and house rent allowance being paid to their employees. While it held that the house rent allowance did not constitute wages it disallowed payment of contributions on attendance allowance' on the ground that there was no agreement touching their payment.

2. The learned counsel for the appellants disputed the correctness of the process of reasoning adopted by the Social Security Court to reach its decision and tried to show that the attendance allowance and house rent allowance paid by the respondents to their employees were nothing else than 'wages'. In order to appreciate the argument of the learned counsel it may be advantageous to have in view the definition of 'wages' given in section 2(30) of the Ordinance which runs as follows :‑‑ "Section 2‑(30)Wages means remuneration for service paid or payable in cash or in kind to a secured person, not being less than remuneration based on the minimum rates of wages declared under the Minimum Wages Ordinance, 1961 (XXXIX of 1961), without taking account of deductions for any purpose under a contract of service or apprenticeship, expressed or implied, and shall be deemed to include any dearness allowance or other addition in respect of the cost of living and any pay ment by the employer to a secured person in respect of any period of authorised leave, illegal lock‑out or legal strike ; but does not include‑-- (a) any payment for overtime ; or (b) any sum paid to the person employed to defray special expenses entailed by the nature of his employment ; or (c) any gratuity payable on discharge ; or (d) any sum paid as bonus by the employer." As observed by the Supreme Court of Pakistan in Sind Employees' Social Security Institution v. Dawood Cotton Mills Ltd. (P L D1977 S C177) referred to by both the parties, the definition accords with the dictionary meaning of the word 'wages'. In Oxford English Dictionary the meaning appropriate to the occasion is 'a payment to a person for service rendered; the amount paid periodically, especially by the day or week or month, for the Labour or service of a workman or servant'. 'Remuneration' by the same dictionary, means reward, recompense, repayment payment, pay'. While explaining the term the Supreme Court was not prepared to extend it so as to include therein every payment made by the employer to an employee ex gratia payments made to the employees were specifically excluded therefrom. It observed that the rendering of service or at least the availability of the employee at the disposal of the employer for service was an essential requirement or prerequisite for the payment of wages. 2A. For purpose of resolution of the present dispute the point for de termination, as agreed to by the learned counsel for the parties, is whether the attendance allowance or house rent allowance is 'remuneration for service' as 'wages' have been defined to mean in the statute. In National Embroidery Mills v. Punjab Employees' Social Security Institution (P L D 1978 Lah. 955) cited at the bar on behalf of the appellants, the attendance allowance was declared to form part of wages and amenable to payment of contri butions. The argument of the learned counsel for the respondents that it was a sort of incentive to the workers for presenting themselves on duty for a minimum required number of days and in that light it should be con sidered as ex gratia payment can hardly be accepted at its face value. It is not paid to an absentee worker or to one who does not put in attendance upto the required standard. The worker eligible for atten dance allowance renders more service to the employer. The allowance is as a matter of fact payment for work done by the employee. It is intimately connected with the performance of duty and rendering of service to the employer. Admittedly the attendance allowance is being paid under settlement between‑the employers and the employees. There fore, it cannot but be called remuneration for service' and consequently falls squarely within wages. In the result the decision of the Social Security Court to the contrary has to be set aside. Appeals Nos. 27 and 281 of 1978, are accordingly accepted and the orders of the appel lant Institution calling for contributions on the attendance allowance paid by the respondents to their employees are restored.

3. The house rent allowance seems to stand on a different pedestal. It is paid to the employees who are not provided residential accommoda tion by the establishment and who take some house on lease. The allowance varies with the salary drawn by the employees and the place where living accommodation is hired. It is paid even to workers who due to some reasons or the other, do not actually work or render service to the employer. It does not bear a direct nexus to the service rendered by the employees. It is a sort of subsidy and compensation for meeting the cost of hire charges. Therefore, I do not think it should be classified as wages. The decision of the Social Security Court in this behalf cannot be disturbed. The present appeal No. 273 of 1978 as also appeals Nos. 275 to 280 and 282 to 284 are consequently dismissed. The parties are left to bear their own costs.