Industrial relation ordinance 2002

by • 15/01/2013 • GeneralComments (0)542

Q-2:     Describe the application, aim, objectives & important definitions of the industrial relation ordinance 2002.




The Industrial Relations Ordinance, 2002 extends to the whole ofPakistanand applies to persons employed in any establishment, or group of establishments or industry.



The Ordinance does not apply to persons employed in:

  1. Police or defence services
  2. Installation or services connected with armed forces
  3. Pakistansecurity printing corporation or security papers limited orPakistanmint
  4. Administration of state
  5. Establishment of treatment of sick, infirm, destitute and mentally unfit
  6. Institution of old-age pension or workers welfare
  7. Members of
  • Watch and ward
  • Security
  • Fire service of oil refinery
  • Production of national gas, liquid petroleum gas or petroleum products
  • Seaport Airport


The aims and objectives of the Industrial Relation Ordinance, 2002 are listed below:

  1. Amend and consolidate the law relating to formation of trade unions.
  2. Regulate the relation between employers and workmen.
  3. Avoidance and settlement of differences or disputes arising between employer and workmen.
  4. Meet the necessity of circumstances for an industrial relation law.






a.      Arbitrator [Section 2(i)]

An arbitrator is a person appointed by the mutual consent of both the parties to a dispute for the purpose of investigation and settlement of the disputes submitted to him.

b.      Award [Section 2(H)]

The award means the determination by a labour Court, Arbitrator, or an Appellate Court of any industrial dispute or any matter relating thereto and includes an interim award.

c.      Association [Section 2(iii)]

Association means any organization of employers formed primarily for furthering and defending the interests and rights of employers.

d.      Board of Conciliators [Section 2(iv)]

Conciliator means a person who is appointed by the Provincial or Federal Government for the purpose of solving any dispute arising between the employers and trade union by making all possible efforts to persuade both the parties to come to a settlement without adopting a legal course of referring the dispute to the labour court

e.      Collective Bargaining Agent [Section 2(v)]

Collective bargaining agent means the trade union of workmen which is the agent of workmen in the establishment, group of establishments or industry in the matter of collective bargaining.

f.        Collective Bargaining Unit [Section 2(vi)]

Collective bargaining unit means those workers or class of workers of an employer in one or more establishments coming within the same class of industry whose terms and conditions of employment are, or could appropriately be, the subject of collective bargaining together.

g.      Commission [Section 2(vii)]

Commission means the National Industrial Relations Commission constituted under the law.

h.      Conciliation Proceedings [Section 2(viii)]

Conciliation proceedings mean any proceedings before a conciliator or board of conciliators.

i.        Conciliator [Section 2(ix)]

Conciliator means:

(i)         Any person appointed as such by Federal Government.

(ii)        Any person appointed as such by a Provincial Government.

j.        Employer [Section 2(x)]

Employer means a person who employs workman under a contract of employment in his establishment and includes person responsible for the management, supervision and control of the establishment, as well as proprietor, director, manager, secretary, agent or other officers concerned with the management of the affairs of the industry. This term also applies to the heirs, successors or assigns of the employer:

(i)         Any person or body of persons, whether incorporated or not, who employs workmen.

(ii)        Heir, successor, assign of such person or body.

(iii)       Any person responsible for direction, administration, management and control of establishment.

(iv)       Authority appointed to run establishment under the authority of Federal or Provincial Government.

(v)        Chief executive office-bearer of a local authority.

(vi)       Director, manager, secretary, agent, office-bearer, person concerned with management of affairs.

(vii)      Contractor, establishment of contractor.

(viii)      Office-bearer of Federal or Provincial or local authority and those notified for this purpose.


Establishment [Section 2(xi)]

Establishment means office, firm, factory, society, undertaking, company shop or premises are enterprise in which workmen are employed for the purpose of carrying on an industry

(i)         Office              (vi)       Company

(ii)        Firm                 (vii)      Shop

(iii)       Factory                        (viii)      Premises

(iv)       Society                        (ix)      Enterprise

(v)        Undertaking

The workmen may be employed either directly or through a contractor. Establishment also includes all the departments and branches, whether situated in the same place or in different places.

l.        Executive [Section 2(xii)]

Executive, as per Section 2(xii) of Industrial Relations Ordinance 2002, means a person or body of persons by whatever name called, to whom the management of affairs of a trade union is entrusted under its constitution.

m.    Group of Establishment [Section 2(xiii)]

Group of establishment within the definition in Section 2(xiii), means establishments belonging to the same employer and the same industry.

n.      Industrial Dispute [Section 2(xvi)]

Industrial dispute means any dispute or difference between employers, and workmen or between workmen and workmen which is connected with the employment or non employment or the terms of employment, or the conditions of work; and it not in respect of the enforcement of any right guaranteed or accrued to workers by or under any law, other than this Ordinance, or any award or settlement for the time being in force. (Sec. 2 (xvi))

o.      Industry [Section 2(xvii)]

Industry means any business, trade, manufacture, calling, service, occupation or employment engaged in an organized economic activity of producing goods or services for sale excluding those set up exclusively for charitable purposes operating, through public or private donations where “charitable purpose” includes provision of education, medical care, emergency relief and other needs of the poor and indigent.

Industry according to Section 2(xvii) of IRO, means any of the following organized economic activities of producing goods or services for sale:

A dispute is not an industrial dispute if it is in respect of enforcement of any right guaranteed (or accrued) to workmen by (I) any law, or (2) any award, or (3) any settlement for the time being in force.

Dispute concerning employment will comprise of objections of the workmen to the employment of any person and with:

(a) Employment or non-employment  (b) Terms of employment

(c) Conditions of work

His non-employment would cover such actions as failure or refusal to employ where there is an obligation to employ, reinstatement, or wrongful dismissal.

(i) Business     (ii) Trade          (iii) Manufacture (iv) Calling

(v) Service       (vi) Occupation (vii) Employment

Industry, however, does not include any set-up exclusively for charitable purposes, operating through public or private donations if such purpose includes provision of education, medical care, emergency relief and other needs of the poor and indigent.

p.      Lock-Out [Section 2(xx)]

Lock-out, according to IR0 2(xx)t means:

(1)        Closing of a place of employment or part of such place.

(2)        Suspension of work, wholly or partly, by an employer.

(з)        Refusal, absolute or conditional, by an employer to continue to employ any number of workmen employed by him.

Any of the above actions of an employer shall be lock-out if such closing, suspension, or refusal occurs in connection with an industrial dispute or is intended of compelling workmen to accept certain terms and conditions of employment.

Illegal Lock Out

Illegal lock out means a lock out declared, commenced or continued otherwise than in accordance with the provisions of this Ordinance. (Sec.2 (xiv))

q.      Office-bearer [Section 2(xxi)]

Office-bearer under IRO, means any member of the executive of a trade union in an establishment, industry or trade. The term does not include an auditor or legal advisor of such trade union.

r.       Settlement [Section (xxvi)]

Settlement, according to IRO means:

(i)         A settlement arrived at in the course of conciliation proceedings.

(ii)        An agreement arrived at otherwise than conciliation proceeding

Between employer and collective bargaining agent, or

Between employer and workmen.

The agreement must be in writing, signed by the parties, and a copy sent to the Provincial Government, Conciliator and other prescribed person* Remember a document, which is not signed by all the parties, is not a settlement in accordance with Section 2(xxvi) of IRO.

s.      Strike [Section 2(xxviii)]

Strike under Section 2(xxviii) of IRO, means:

(i)         Cessation of work by a body of persons employed in any establishment acting in combination, or

(ii)        Concerted refusal of any number of persons who have been so employed to continue to work or to accept employment, or

(iii)       Refusal under a common understanding of any number of such persons to continue to work or to accept employment.

Illegal Strike

Illegal strike means a strike declared, commenced or continued otherwise than in accordance with the provisions of this Ordinance (Sec.2 (xv))

t.        Trade Union [Section 2(xxix)]

IRO in Section 2(xxix) defines a trade union to mean:

(i)         Any combination of workers formed primarily to further and defends the interest and rights of workers.

(ii)        An industry-wise federation of two or more collective bargaining agent unions,

(iii)       A federation at the national level of two or more collective bargaining unions.

u.      Worker [Section 2(xxx)]

Worker under Section 2(xxx) of IRO means:

(i)                  Any person who does not fall within the definition of an employer.

(ii)                Any person who is employed in an establishment or industry for remuneration or reward, either directly or through a contractor, whether the terms of employment be express or implied.

(iii)               For the purpose of any proceedings in relation to an industrial dispute, means a person who has been

(a)        Dismissal        (b)        Discharged                             (c)        Retrenched,

(d)        laid off             (e)        Otherwise removed from employment

Remember that the above action is in connection with, or as a consequence of, the dispute of whose dismissal, discharge, retrenchment, lay-c for removal has led to that dispute. However, it does not include any person who is employed mainly in a managerial or administrative capacity. Directions: homework lnet the above introduction gives some background and states the thesis!

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