Interim Report - REPORT_NO318, November 1999

1. 324. In a communication dated 11 February 1999, the All Pakistan Federation of Trade Unions (APFTU) presented a complaint of violations of freedom of association against the Government of Pakistan. Public Services International (PSI) and the International Confederation of Free Trade Unions (ICFTU) associated themselves with this complaint in communications dated 16 February 1999 and 27 April 1999, respectively. The APFTU submitted additional information in communications dated 8 and 10 April, 25 May and 25 June 1999. The Federation of Oil, Gas, Steel and Electricity Workers (FOGSEW-Pakistan) also presented a complaint of infringements of trade union rights in a communication dated 8 June 1999.
2. 325. The Government supplied its observations in a communication dated 2 September 1999.
3. 326. Pakistan has ratified the Freedom of Association and Protection of the Right to Organise Convention, 1948 (No. 87), and the Right to Organise and Collective Bargaining Convention, 1949 (No. 98).

A. The complainants' allegations

1. 327. In its complaint, the APFTU asserts that the Government has violated Conventions Nos. 87 and 98 by issuing a Presidential Ordinance No. XX dated 22 December 1998 which suspended the trade union and collective bargaining rights of more than 130,000 workers employed in the largest public utility of the country, namely the Pakistan Water and Power Development Authority (WAPDA) which is responsible for the generation, transmission and distribution of electricity and development of water resources and the provision of other services (a copy of the Presidential Ordinance is annexed to the complaint).
2. 328. More specifically, the APFTU alleges that the said Presidential Ordinance suspended the application to WAPDA of the Industrial Relations Ordinance, 1969, which regulates the formation, registration and functioning of a trade union organization as a collective bargaining agent and the enforcement of agreements reached between a union and management. The APFTU further alleges that the application to WAPDA of the Industrial and Commercial Employment (Standing Orders) Ordinance, 1968, pertaining to workers' job security was suspended by Presidential Ordinance No. XX and that amendments were incorporated in the WAPDA Act, 1958 (section 17-(1A)) whereby the services of WAPDA workers could be dispensed with through retirement without assigning any reason. In addition, the rights of the APFTU's affiliate, the WAPDA Hydro Electric Central Labour Union, as collective bargaining agent were cancelled. The APFTU points out that the WAPDA Hydro Electric Central Labour Union, which is the largest industry-wide trade union in the country, has been representing WAPDA workers for the past 50 years and was again recently declared to be the collective bargaining agent for WAPDA workers through a referendum held at the national level on 29 December 1997. The APFTU indicates that the management of WAPDA also issued a notification to the effect that the Presidential Ordinance No. XX suspended the operation of the Industrial Relations Ordinance, 1969, and the Industrial and Commercial Employment (Standing Orders) Ordinance, 1968, for a period of two years commencing from 22 December 1998 in WAPDA (a copy of the said notification is attached to the complaint).
3. 329. The APFTU then contends that Presidential Ordinance No. XX handed over the running of WAPDA to the armed forces. In effect, the Government resorted to the recruitment of approximately 35,000 army officers to manage WAPDA allegedly to check the pilferage of electricity. The APFTU points out, however, that the WAPDA Hydro Electric Central Labour Union had been cooperating with management to eliminate such pilferage of energy. Moreover, these army officers were recruited by the Government at exorbitant salaries with perks which were 150 times higher than those of the regular WAPDA workers.
4. 330. The APFTU asserts that the promulgation of Presidential Ordinance No. XX had the following additional serious consequences. In a communication dated 7 February 1999, senior management of WAPDA issued an order to all general managers, chief executives and heads of divisions that "no subscriptions shall be deducted from the wages of workers under check-off, as trade union activities are banned for a period of two years with effect from 22 December 1998" (a copy of the order is attached to the complaint). Furthermore, in a notification dated 20 March 1999, the Deputy Registrar of the National Industrial Relations Commission cancelled the registration of the WAPDA Hydro Electric Central Labour Union and informed it that it ceased to exist with effect from 22 December 1998 (a copy of the notification of cancellation of registration is attached to the complaint). The APFTU states that its affiliate filed an appeal against this decision to the Lahore High Court. In addition, in a communication dated 5 May 1999, the management of WAPDA ordered the closing down of all labour welfare centres at various power stations which provided recreational facilities for the workers at WAPDA (a copy of this communication is attached to the complaint).
5. 331. Finally, the APFTU contends that while Presidential Ordinance No. XX of 22 December 1998 elapsed on 22 April 1999, the Government promulgated Ordinance No. V of 1999 on 24 May 1999 which has the same contents, purpose and effects as the first Ordinance. The APFTU concludes that the Government should revoke such measures which apart from constituting a flagrant violation of freedom of association were also deemed to be unconstitutional restrictions on its affiliate by various sections of civil society including the Chairman of the Human Rights Commission of Pakistan, the former Chief Justice of Pakistan and the President of the Supreme Court Bar Association.
6. 332. In its communication dated 8 June 1999, the Federation of Oil, Gas, Steel and Electricity Workers (FOGSEW-Pakistan) alleges that through two Presidential Ordinances issued on 27 May 1999, the Government has debarred the Karachi Electric Supply Corporation (KESC) from the purview of the Industrial Relations Ordinance, 1969, and has allowed management to forcibly retire any KESC employee without assigning any reason. This grave situation has resulted in the forced closure of the collective bargaining agent's union office as well as a ban on the CBA union by the new management of the KESC, with effect from 31 May 1999. Hence, the FOGSEW's affiliate, the KESC Democratic Mazdoor Union, which was duly elected as CBA in the establishment as a result of a referendum held on 23 February 1999 has been seriously affected by the Government's actions. FOGSEW contends that these very serious infringements of trade union rights warrant the appointment of a Commission of Inquiry against the Government of Pakistan.

B. The Government's reply

1. 333. In its communication dated 2 September 1999, the Government first of all proceeds to give background information about WAPDA. It indicates that WAPDA was established under the WAPDA Act, 1958, for the development of water and power resources of the country. To achieve these objectives, the authority undertook construction and operation of dams, barrages, canals, tube wells, power stations, grid stations, transmission lines and supply and distribution of electricity to the consumers of international, agricultural, commercial and domestic sectors. The Government stresses that WAPDA has contributed greatly towards the development of the economy of the country by constructing seven dams, 14 thermal power stations, 11 Hydel power stations and 456 grid stations. As such, WAPDA can rightly be depicted as the backbone of Pakistan's economy.
2. 334. The Government then briefly describes the management structure of WAPDA. WAPDA is headed by a chairperson, a deputy chairperson and three members, one each for power, water and the finance wings. The members work through managing directors and general managers in their respective disciplines. The total number of employees in WAPDA is 137,693: (a) number of officers in basic pay scale BPS-16 to 21: 8,816; (b) number of employees (workers) in BPS-1 to 16: 128,877; and (c) number of unionized employees: 95,545.
3. 335. The Government points out that the installed capacity of electricity in Pakistan is 14,957 megawatts. Generation fluctuates according to demand. The estimate of electricity lost because of technical reasons such as line and system losses is 20 per cent. Pilferage/power theft added another 20 per cent to this figure. Pilferage was made possible with the active connivance of the field staff of WAPDA -- the ones who interact actively with the public. This electricity pilferage had the following consequences: (a) loss of revenue to the organization, depriving it not only of maintaining its services but also from upgrading its system to minimize technical losses; (b) increase in load shedding, especially in the summer months when temperatures across most of the country range above 40oC. In the rural sector, dependent largely on canal water or underground water, load shedding severely hampered agricultural production because tube wells remained inactive for long durations; and (c) increased consumer complaints.
4. 336. The Government explains that the usual methods of pilferage were: (a) unauthorized connections; (b) meter tampering; and (c) wrong billing. The burden of these practices was borne by the common man. The public was fast losing all confidence in WAPDA to carry out its task. There were frequent demands by consumer groups for the privatization of the organization. This rampant corruption, inefficiency and the resultant loss in revenue had seriously affected the viability of the organization.
5. 337. The Government indicates that by late 1998, WAPDA was running a deficit of Rs.45 billion (approximately US$870 million). This was expected to rise to Rs.74 billion (approximately US$1.43 billion) by June 1999. The resultant financial collapse would have led to the liquidation of WAPDA. Since the organization would have been devoid of funds to pay the wages, tens of thousands of jobs would have been lost. It would have also brought the entire country to a standstill, making the life of the community nearly impossible.
6. 338. The Government goes on to describe the role of the unions in these practices. The management of WAPDA had tried various measures to restore the financial viability of the organization and to reintroduce a culture of efficiency, accountability and discipline. Unfortunately it was not successful. The management was helpless in taking disciplinary action against the delinquents and corrupt elements, largely due to interference and pressure by the union. It had become practically impossible to post out a corrupt meter reader or an assistant lineman to other areas. This led to a near paralysis of WAPDA's administration. In addition meter readers and other similar officials could not be disciplined by their respective administrative heads as they tried to use their union membership to avoid disciplinary action. On occasion office-bearers of the CBA gave protection to such elements. This perpetuated mismanagement and massive theft of electricity. While the National Industrial Relations Commission (NIRC) had approved that only 75 office-bearers of the CBA union were to be notified, the CBA appointed over 10,000 office-bearers at various organizational levels. Due to union pressure these office-bearers could not be posted out by the management. Some of them were directly involved in giving protection to the corrupt elements within WAPDA.
7. 339. In order to avert a complete collapse of WAPDA which would have caused great human suffering and economic hardship, the federal Government was constrained to seek the assistance of the armed forces under article 245 of the Constitution of the Islamic Republic of Pakistan. (Endnote 1) The army was therefore ordered to assist the WAPDA management in restoring the financial health of the organization through checking pilferage/power theft. The Government stresses that this was an act of the last resort and taken solely to make the WAPDA viable once again.
8. 340. The involvement of the army in WAPDA occurred in two phases. In the first phase, which ended on 25 July 1999, 31,444 army personnel were deputed to WAPDA. After 25 July 1999, only about 10 per cent army personnel were retained and the rest have returned to their units. The army personnel helped the organization in: (a) removing unauthorized connections, which turned out to be tens of thousands; (b) replacing defective metres; (c) ensuring timely and correct billing; (d) checking the metres by surveillance teams; (e) serving detection bills where theft was unearthed; (f) maintenance of the system to reduce technical losses; and (g) the recovery campaign for collection of public revenue.
9. 341. The Government points out that the campaign launched by the army and WAPDA teams has resulted in: (a) 43 per cent increase in billing and receipts for January-June 1999, in comparison to January-June 1998, i.e. an increase of over Rs.20.9 billion (approximately US$400 million) in billing; (b) reduction of Rs.93 billion (US$1.7 billion) in receivables; (c) over 7 per cent decrease in line losses; and (d) reduction of pilferage to less than 1 per cent.
10. 342. In addition to the abovementioned reduction in negative trends, the following positive developments were also registered: (a) 406,805 new electricity connections were given in January-June 1999 as against 235,066 for the same period in 1998; (b) consumer complaints dropped by 48,837; and (c) there is no load shedding anywhere in the country.
11. 343. With regard to the present status of the union in WAPDA, the Government emphasizes that the activities of the union have only been suspended in response to a specific situation for a limited period. The Government stresses that Ordinance No. XX of 1998 does not take away the right of workers to organize, i.e. the legal organizational structure of the union remains intact. Moreover, the status of the CBA union with Mr. Khurshid Ahmed as its general secretary is virtually unaffected. He continues to represent the workers' cause at all forums. He was also a delegate to the 87th Session of the ILC held in June this year, representing the workers of Pakistan. In addition, following the suspension of union activities, no action was taken against any member of the union for the exercise of his/her legitimate right of freedom of association. In fact not a single incidence of use of force, imprisonment or harassment took place. There continues to be a healthy and constructive interaction between the management and the workers. Committees have been constituted at the level of distribution companies with formal participation of the workers. These committees are functioning and showing positive signs of harmony between the management and the workers. Finally, the situation is being continuously monitored and reviewed. There is a possibility that with the cooperation and support of the workers, trade union activities may be fully restored before the two-year period specified in Ordinance No. XX of 1998.
12. 344. The Government nevertheless indicates that in view of the gravity of the situation, which required sufficient time for the organization to become viable and productive again, Ordinance No. XX, 1998, was repromulgated as Ordinance No. V (1999) with effect from 24 May 1999. According to the Constitution, the life of an Ordinance is four months, therefore the measures taken by the Government with regard to WAPDA are essentially of a temporary nature.
13. 345. The Government concludes that the invocation of article 245 of the Constitution was the last resort available to it. In the absence of such action, WAPDA would have ceased to exist with extremely grave consequences not only for the tens of thousands of workers of the organization but the nation as a whole. While the Government fully respects the fundamental workers' right of freedom of association, the WAPDA-related decisions were taken as an exceptional measure which was essential for the welfare of the community and the health of the country's economy. Finally, the Government indicates that it is committed to restoring the WAPDA union as soon as the financial situation of WAPDA allows it and even before the completion of the two-year period specified in Ordinance No. XX of 22 December 1998.

C. The Committee's conclusions

1. 346. The Committee notes that the allegations in this case concern the denial of trade union and collective bargaining rights for workers of the Pakistan Water and Power Development Authority (WAPDA) as well as for workers of the Karachi Electric Supply Corporation (KESC) pursuant to the issuance of Presidential Ordinances which excluded the application of the Industrial Relations Ordinance, 1969, to these two public utilities.
2. 347. As regards the situation of WAPDA workers, the Committee notes the allegation of the All Pakistan Federation of Trade Unions (APFTU) that Presidential Ordinance No. XX dated 22 December 1998 suspended the trade union and collective bargaining rights of more than 130,000 WAPDA workers since the said Presidential Ordinance suspended the application to WAPDA of the Industrial Relations Ordinance, 1969, which regulates the formation, registration and functioning of a trade union organization as a collective bargaining agent and the enforcement of agreements reached between management and the union. The Committee notes that the Government does not refute this allegation. Rather it appears to justify the promulgation of Presidential Ordinance No. XX by indicating that it was an exceptional measure which was essential for the welfare of the community and the health of the country's economy. In this regard, the Committee would recall that the Committee of Experts on the Application of Conventions and Recommendations has emphasized that the freedom of association Conventions do not contain any provision permitting derogation from the obligations arising under the Convention, or any suspension of their application, based on a plea that an emergency exists (see Digest of decisions and principles of the Freedom of Association Committee, 4th edition, 1996, para. 186). Nevertheless, as regards countries which are in a state of political crisis or have just undergone grave disturbances (civil war, revolution, etc.), the Committee has considered it necessary, when examining the various measures taken by the governments, including some against trade union organizations, to take account of such exceptional circumstances when examining the merits of the allegations (see Digest, op. cit., para. 197). However, in the case at hand, the Committee does not consider that the pilferage of electricity in WAPDA and the resultant loss in revenue constitute such circumstances of extreme gravity as to warrant the ensuing restrictions on trade union and collective bargaining rights. Moreover, while noting the Government's statement that a number of office-bearers of the CBA union (the WAPDA Hydro Electric Central Labour Union) were either directly or indirectly involved in corrupt activities in WAPDA resulting in the massive theft of electricity, the Committee is of the view that to deprive many thousands of workers of their trade union organization because illegal activities have been carried out by some leaders or members constitutes a clear violation of the principles of freedom of association (see Digest, op. cit., para. 667). The Committee considers that if it was found that certain members of the trade union had committed excesses going beyond the limits of normal trade union activity, they could have been prosecuted under specific legal provisions and in accordance with ordinary judicial procedure, without involving the suspension and subsequent dissolution of an entire trade union movement (see report of the Commission of Inquiry on the observance by Poland of Conventions Nos. 87 and 98, Official Bulletin (Vol. LXVII), 1984, para. 492).
3. 348. The Committee further notes the Government's statement that Ordinance No. XX of 1998 does not take away the right of workers to organize and that the legal organizational structure of the union remains intact. The Committee would first of all point out that this statement is contradictory in that the Government itself acknowledges in its reply that trade union activities in WAPDA have been suspended albeit in response to a specific situation. Moreover, in the Committee's view, the Government's claim that Presidential Ordinance No. XX does not take away the right of workers to organize does not appear to be borne out by the facts on the ground. Indeed, the Committee notes that according to the APFTU's allegations -- which the Government does not comment upon -- the management of WAPDA issued an order in February 1999 that trade union dues would no longer be deducted from the wages of workers pursuant to Presidential Ordinance No. XX (see Annex I). Moreover, the management of WAPDA issued another order in May 1999 ordering the closing down of all labour welfare centres at various power stations. The Committee considers that the suspension of the practice of deducting trade union dues coupled with the suspension of trade union activities risks jeopardizing the very existence of the APFTU's affiliate, the WAPDA Hydro Electric Central Labour Union. Finally, the Committee fails to see how the legal organizational structure of the union remains intact since the Deputy Registrar of the National Industrial Relations Commission cancelled the registration of the union in March 1999 (see Annex II). In this regard, the Committee has emphasized that the cancellation of registration of an organization by the registrar (or deputy registrar) of trade unions is tantamount to the suspension or dissolution of that organization by administrative authority which constitutes a clear violation of Article 4 of Convention No. 87 and that cancellation of a trade union's registration should only be possible through judicial channels (see Digest, op. cit., paras. 669 and 670). In this respect, the Committee notes that the WAPDA Hydro Electric Central Labour Union has filed an appeal to the Lahore High Court against the decision of the Deputy Registrar. It requests the Government to keep it informed of the outcome of the decision handed down by the Lahore High Court.
4. 349. For all the abovementioned reasons, the Committee strongly deplores the promulgation of Presidential Ordinance No. XX of 1998 which suspended the trade union rights of WAPDA workers and prevented the WAPDA Hydro Electric Central Labour Union from carrying out its normal trade union activities including receiving its trade union dues. The Committee urges the Government to refrain in the future from having recourse to measures of suspension or dissolution through administrative channels which constitute serious infringements of the principles of freedom of association. The Committee notes that Presidential Ordinance No. XX elapsed on 22 April 1999 since, according to the Pakistani Constitution, the life of an ordinance is four months. The Committee notes with serious concern, however, that Ordinance No. XX, 1998, was repromulgated as Ordinance No. V, 1999, with effect from 24 May 1999. The Committee requests the Government to confirm that Ordinance No. V elapsed on 24 September 1999. If this is not the case, the Committee would urge the Government to repeal Ordinance No. V, 1999, immediately, in order to re-establish the registration of the WAPDA Hydro Electric Central Labour Union. It also requests the Government to ensure that the practice of deducting trade union dues is resumed without delay. It requests the Government to keep it informed of measures taken to give effect to its recommendations. It requests the Government to keep it informed in this regard.
5. 350. The Committee notes with serious concern the allegations of the Federation of Oil, Gas, Steel and Electricity Workers (FOGSEW-Pakistan) in a communication dated 8 June 1999 to the effect that the Government has excluded the Karachi Electric Supply Corporation (KESC) from the purview of the Industrial Relations Ordinance, 1969, through two Presidential Ordinances issued on 27 May 1999 with the result that the FOGSEW's affiliate, the KESC Democratic Mazdoor Union, has been banned by the new management of KESC with effect from 31 May 1999. Noting that the Government has not replied to these serious allegations, the Committee urges the Government to provide its observations thereon without delay.
6. 351. The Committee deplores the fact that certain WAPDA and KESC union officials were forcibly pre-retired.

Z. Annex I

• Pakistan Water and Power Development Authority
• Labour and Welfare Directorate
• WAPDA Sunny View Lahore
• No. DLW-09770/1517-1816
• Dated: 7.2.1999
• Office order
• Time and again it has been reported that this office circular No.
  0. DLW-09720/35-1385, dated 8.1.1999 is not being implemented in letter and
• spirit.
• Due to promulgation of Ordinance No. XX of 1998 the trade unions functioning
• in WAPDA are non-existent. They cannot perform any function in the
• establishments of WAPDA. It is again clarified that no subscription shall be
• deducted from the wages of the workers under check-off as the trade union
• activities are banned for a period of two years w.e.f. 22.12.1998.
• All GMs/CEs/Heads of Divisions are advised to ensure strict compliance of the
• Ordinance No. XX of 1998.
• Shabbir Ahmed
• Director (Labour and Welfare) WAPDA
• Annex II
  3. No. 3(19)/73 Government of Pakistan
• National Industrial Relations Commission
• Sector G-5/2, Islamabad
• From: Mr. Zakaullah Khan Khalil
• Deputy Registrar
• Dated: 20.3.1999
• The General Secretary
• Pakistan Hydro Electric Central Labour Union
• Bakhtiar Labour Hall, 28 Nisbat Road, Lahore
• Subject: Pakistan Hydro Electric Central Labour Union
• The undersigned is directed to say that through an Ordinance No. XX of 1998
• effective from 22.12.1998, a new section 17A has been inserted in WP Act XXXI
  19. of 1958. The aforesaid section is reproduced below:
• Certain laws not to apply to employment under the Authority: Nothing contained
• in the West Pakistan Industrial and Commercial Employment (Standing Orders)
• Ordinance, 1968 (WP Ordinance VI of 1968), or the Industrial Relations
• Ordinance, 1969 (XXXIII of 1969), shall apply to or in relation to the
• Authority or any of the officers or employees appointed by it.
• You are hereby informed that after commencement of the aforesaid Ordinance
• your union namely "Pakistan Hydro Electric Central Labour Union" registered by
• the Commission vide Certificate No. 46/73 as an industry-wise trade union of
• workmen employed by WAPDA has ceased to exist w.e.f. 22.12.1998 as IRO, 1969,
• no more applies on the employment of WAPDA.
• By order of the Commission
• (Zakaullah Khan Khalil)
• Deputy Registrar
• Copy to the Chairman, WAPDA, WAPDA House, Lahore