Friday June 14, 2024

SC verdict puts EOBI, WWF in a quandary

By Ahmad Hassan
November 17, 2016


The Supreme Court’s verdict of November 10, 2016 by which all the ordinances in respect of Employees Old-age Benefits Institution Act 1976, Workers Welfare Fund ordinance 1971 and Ordinance 1968 etc were annulled as unlawful. The apex court held that no amendment was legally made after the contributions in question were declared as fee and not tax. Hence the application of those amendments would cease unless further legislation is made through the parliament.

At present there are approximately 0.5 million pensioners under EOBI and some five million workers of various categories including women are registered for contributions.

The biggest handicap of the EOBI is that it is mostly headed and run by the officers appointed by the federal government who usually have little or no background of the working in a workers welfare institution. One of the outgoing chairmen, Zafar Iqbal Gondal was found in gross financial irregularities during PPP rule and is in jail while the just transferred Saleh Muhammad Farooqi worked part time as he being a favourite of PM also worked as chairman of implementation of Green bus project of Karachi. Race is on for replacing him and a number of candidates of the federal bureaucracy are vying for the coveted post.

Interestingly an official Raja Faizul Hasan Faiz who was labour adviser during PPP rule advised the institution on making amendments to deprive the poor private sector workers of their rights through finance bills and instead of being reprimanded for the same he has been elevated to legal consultant in Federal Ombudsman’s cell.

There is an inbuilt anomaly in the EOBI in working out contributions of the concerned organization along with the incumbent as well as pensions as it has adopted the minimum wage as benchmark as against the old age pensioners of the government whose contributions are worked out on basis of their progressive salary slabs and their pensions are paid according to their last pay. By this the private organizations’ workers who are working in different categories from lowest to the highest slabs are paid the same lowest rated pensions which make it meaningless for the higher salaried men and women.