1
EMPLOYEES OLD-AGE BENEFITS ACT, 1976 (AMENDED UPTO JUNE, 2005) ALONGWITH HISTORICAL BACK GROUND (BEAR ACT)
UPDATED
BY: -
MAHMOOD ALAM SOOMRO M.A., LL.B. DIRECTOR (LA ( LAW) W) EOBI, Head Office, Karachi.
HISTORICAL BACK GROUND ALONG WITH
2
BRIEF ON AMENDMENTS FROM 1976 TO 2005. Prior to this law, in Pakistan, there were so many labour laws like Work’s Compensation Act, 1923 Factories Act, 1934, Paym Pa yment ent of Wa Wages ges Act Act,19 ,1936, 36, West Pa Pakis kistan tan Soc Social ial Sec Securi urity ty Ordina Ord inance nce,, 196 1965 5 (Or (Ordin dinanc ance e No: X of 196 1965), 5), West Pa Pakis kistan tan Industrial and Commercial (Standing Orders) Ordinance, 1968, Comp Co mpani anies es Pr Prof ofit it (w (wor orke kers rs’’ Par arti tici cipa pati tion on)A )Act ct,1 ,196 968, 8, Wes estt Pakistan Shops and Establishment Ordinance,1969, Industrial Relation Relat ion Ordi Ordinance nance,196 ,1969, 9, Wo Worke rkers rs Wel Welfare fare Fund Ordi Ordinance, nance, 1971, Workers Workers Chil Children dren (Ed (Educati ucation) on) Ordi Ordinance nance,, 1972 1972,, etc. In many labour laws remedial, beneficial and welfare clauses and sectio sec tions ns wer were e pro provid vided ed but non none e fro from m the these se la laws ws or oth others ers provide such coverage of the old-age risk thus it was necessary to make a law that can provide security in the eve of old age when a man becomes handicap to work hard, condition of invalidity and in the case of death of a worker / employee the th e pe pens nsio ion n to th the e wi wido dows ws an and d or orph phan ans. s. In th the e Eu Euro rope pean an countries such laws were in operation.
In view of this need, first time in Pakistan, in 1972, an Ordina Ord inance nce wit with h the ti title tle of the Em Emplo ployee yees' s' Ol Old-A d-Age ge Pen Pensio sion n Ordinance (Ordinance X of 1972) was promulgated. Under this legislation first time, in Pakistan, the Government indicates its desi de sire re to in intr trod oduc uce e su such ch a so soci cial al se secu curi rity ty sc sche heme me fo for r th the e betterment of the employ oye ees of private sectors. This Ordinance was issued on 23rd April, 1972 where under Old Age Pension scheme was introduced and a pension @ Rs; 60/= was sugg su gges este ted d on co comp mple leti tion on of 20 ye year ars s of se serv rvic ice. e. For th this is purpose retirement age was fixed at 55 years (50 years for female). This was a provincial legislation that was intended to apply app ly onl only y to tho those se est establ ablish ishmen ments ts whi which ch emp employ loyed ed 10 100 0 or more workers, and wages for coverage under this scheme were proposed to be fixed at Rs. 500/= per month, while the rate of the contribution was fixed 5%, to be paid by the employer. Before the implementat implementation ion of the Employees' Old-Age Pension Ordinance, 1972, it was realized that the provincial pension scheme schem e would not bear bear fruit thus the scheme scheme was reshaped reshaped and aft after er muc much h wor work k the thereo reon n the gov govern ernmen mentt int introd roduce uced d a
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better scheme for the betterment, welfare and benefits of the people of Pakistan.
This better scheme was promul ulg gated on 23rd December,, 1975, whereby the Federal Government in the place December of the Employees' Old-Age Pension Ordinance, 1972, notified the Employees Old-Age Benefits Ordinance (Ordinance XXVI of 1975 19 75). ). Th This is la law w re rela late tes s to Ol Oldd-Ag Age e Be Bene nefi fits ts fo for r pe pers rson ons s employed emplo yed in indu industri strial, al, comm commercia erciall and other organ organizat izations, ions, employing at least ten persons
Later on the Employees' Old-Age Benefits Ordinance, 1975, was substituted by the better enactment, the Employees' Old-Age Benefits Act, 1976, (Act No XIV of 1976) which was passed by the National Assembly on 5th April, 1976. The Pre Presi siden dentt of the Isl Islami amic c Rep Republ ublic ic of Pa Pakis kistan tan gav gave e his assent on 15th April, 1976, and then the Act was published in the Official Gazette of Pakistan on 19th April, 1976. Although it came ca me in into to fo forc rce e at on once ce,, bu butt as pe per r se sect ctio ion n 9 th ther ereo eoff th the e contribution was payable from 1st day of July, 1976. This Act was implemented from 1st day of July, 1976.
After promulgation of this statute many amendments are made therein and the last amendment has been mad in June 2005 through Finance Act, 2005. Since the process of amen am endm dmen entt is a no nonn-st stop op pr proc oces ess s he henc nce e th this is jo jour urne ney y of amendment is in way of further amendments in view of the need of the nation and ILO conventions and recommendations on Social Security laws/ schemes. Till June 2005 this law has been amended through amendments as below:1. Emplo Employee yees’ s’ Ol Old-A d-Age ge Ben Benefi efits ts (A (Amen mendm dment ent)) 1983. (Ordinance No. XVII of 1983), 2. Fina Finance nce Act, Act, 1986. 1986. (Act 1 of 1986) 1986),, 3. Labo Labour ur Laws (Amendments) (Amendments) Ordinance Ordinance,, 1993 XXIII of 1993), 4. Em Empl ploy oyee ees s Ol Oldd-Ag Age e Be Bene nefi fits ts (A (Ame mend ndme ment nt)) 2000. (Ordinance IX of 2000), 5. Lab Labour our Law Laws s (Am (Amend endmen ment) t) Ord Ordina inance nce,, 200 2001. 1. LIII of 2001),
Ordina Ord inance nce,,
(Ordinance (Ordinanc e Ordi Or dina nanc nce, e, (Ordin (Or dinanc ance e
4
6. Emplo Employee yees’ s’ Ol Old-A d-Age ge Ben Benefi efits ts (A (Amen mendm dment ent)) Ord Ordina inance nce,, 2002. (Ordinance I of 2002), 7. Employees' Old-age Benefits (Amendment) Ordinance, 2002. (Ordinance XLVI of 2002), and 8. Fi Finan nance ce Act, Act, 2005 2005..
EMPLOYEES’ OLD-AGE BENEFITS ACT, 1976
CONTENTS CHAPTER – I PRELIMINARY. 1.
Short title, extent, commencement and application.
2.
Definition.
CHAPTER – II INSURED PERSON 3.
Compulsory Insurance.
4.
Administration.
5.
Nomination of a body corporate pending establishment of an Institution.
6.
Management.
7.
Board of Trustees
8.
Powers and Functions of the Board of Trustees
8A.
Appointment, Powers and Functions of Chairman
CHAPTER – III
5
CONTRIBUTION 9.
Rates and Assessment
9A.
Contribution by Government.
9B.
Contribution by the insured person
10.
Records and Returns by Employers.
11.
Registration of Establishment, Etc.
11A. 12.
Cancellation of Registration of Establishments etc. Officials of Institution to Check Employer's Books.
13.
13. Increase of Unpaid Contribution and Recovery of Contribution, etc., as arrears of land revenue.
14.
Safeguard of Insured Person’s Right in Default of Payment of Contributions by Employers.
15.
Refund of Contributions Paid Erroneously
16.
Extinguishment of Claims to Contributions
CHAPTER – IV FINANCE AND AUDIT
17.
Employees' Old-Age Benefits Fund
18.
Investments and Loans
19.
Budget, Accounts and Audit
20.
.Annual Report
21.
Valuation of Assets and Liabilities
6
CHAPTER – V BENEFITS 22.
Old-Age Pension
22-A
Old-Age Grant
22-B
Survivor’s Pension
23.
Invalidity Pension.
CHAPTER – VI PROVISIONS COMMON TO ALL BENEFITS.
24.
Calculation of Qualifying Contribution Periods.
25.
Benefit Claims and Payments.
26.
Extinguishment of Benefits.
27.
Suspension of Old-Age Pension and Survivor's Pension.
28.
Non-Duplication of Benefit.
29.
Benefit nor Attachable, Chargeable Or Assignable.
30.
Repayment of benefit improperly received.
31.
Institution's Right to Be Indemnified in Certain Cases
32.
Recovery of Amounts Due
CHAPTER – VII
7
DETERMINATION OF QUESTIONS AND CLAIMS
33.
Decisions of Complaints, questions and disputes.
34.
Review of decision
35.
Appeal to Board.
36.
Assessment of invalidity invalidity..
CHAPTER – VIII OFFENCE AND PENAL P ENALTIES. TIES. 37.
Offences.
38.
Prosecution.
CHAPTER – IX 39.
Contributions etc
40.
Exemption From Stamp Duty
41.
Exemption From Taxes
42.
Member and servants of the institution to be public servants
43.
Delegation of Powers
44.
Power to make Rules
45.
Power to make Regulations
46.
Power to exempt.
47.
Act not to apply to certain persons.
48.
Repealed
8
Schedule
EMPLOYEES' OLD-AGE BENEFITS ACT, 1976
(ACT No. XIV OF 1976) [April 15,1976]
An Act to repeal and re-enact the Law relating of Old-Age benefits for the persons employed in industrial, commercial and other organizations.
WHEREAS WHEREA S it is exp expedi edient ent to rep repeal eal and re-en re-enact act the law rel relati ating ng to old-age benefits for the persons employed in industrial, commercial and other organizations and matters connected therewith: It is hereby enacted as follows: -
CHAPTER 1 PRELIMINARY
1. Short Title, Extent, Commencement and Application . (1) This This Act may be called the Employees' Old-Age Benefits Act, 1976.
(2) It extends to the whole of Pakistan. (3) It shall come into force at once. 1[(4) It applies to every industry or establishment. (i) wherein ten or more persons are employed by the employer, directly or through any other person, whether on behalf of himself or any other person, or were so employed on any day during the preceding twelve months, and shall continue to apply to every such industry or establishment even if the number of persons employed therein is, at any time after this Act becomes applicable to it, reduced to less than ten; or
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2[(i-a) wherein less than ten persons are employed if such industry or establishment voluntarily applies for application of this Act and this Act shall apply ap ply to su such ch in indus dustry try or es esta tabli blish shme ment nt fo forr th thee da date te of su submi bmiss ssio ion n of an application by such industry or establishment; or
(ii) which the Feder Federal al Governm Government ent may, by notif notificati ication on in the official Gazette, specify in this behalf.} _________________________________________________________________ 1.
Sub-sec.(4) by Ord. XVII of 1983.s.e enforced from July 1,1983=1983 PLS 81
2.
Inserted Cl.(i-a) in sub-sec( c(4 4) by Labou ourr Laws (Am Amen end dment nt)) Ordinance,2001 Ordina nce,2001(Ord. (Ord. LIII), s.7(1), effective effective from July 1, 2001: Gaz.of Pak. Extr. Pt. I, Oct. 20,2001.
Definitions. -In this Act, unless the context otherwise requ ires,-
2.
[
(a) "benefits " mean old-a old-age ge pensi pension, on, inval invalidity idity pension, [survivor’s] [survivor’s] 2 pension, old-age grant and such other payments as may be determined by the Federal Government from time to time;}
3[(aa)
"Board” means the Board of Trustees constituted under section 7 ;}
(b) "Contribution " means the sum of money payable to the Institution by the employer {or by the Federal Government}4 in respect of an insured person under the provisions of the Act. 5[( [(bb) bb)
"employee " mea means ns any per person son emp employ loyed, ed, whe whethe therr dir direct ectly ly or through any other person, for wages or otherwise, to do any skilled or unskilled, supervisory, clerical, manual or other work in, or in connection with the affairs of, an ind indust ustry ry or est establi ablishm shment ent,, unde underr a cont contrac ractt of ser servic vicee or appr apprenti entices ceship hip,,
10 whether written or oral, express or implied, and includes such person when laid off {:]] 6[
Omitted]
Provided5[ * * ] that a director of a limited company or of a corporation set up unde underr any law shall shall not be treated treated as an emp employ loyee ee under this this Act, Act, irrespective of his wages or emoluments ;] 7[(c)
"employer ", in relation to an industry or establishment, mean any employee, and includes(i) in the case of an individual, an heir, successor, administrator or assign; (ii) a person who has ultimate control over the affairs of an industry or establishment, or where the affairs of an industry or establishment are entrusted to any other person (whether called a managing agent, managing director, manager, superintendent, secretary or by any other name), such other person ;and] 8[(iii)
[Omitted]
(d) "employment injury " means a personal injury to an insured person caused by an accident, or by such occupational disease as may be specified in the regulations, arising out of and in the course of his employment: _______________________________________ __________________________ __________________________ _________________________ _________________________ ______________ _ ___ 1
Cl..(a) added after re-numbering original cl.(a) as (aa) by Or. XVII of 1983, enforced from 1st July 1983= 1983 PLS 81
2.
Subs. for word”widow’s word”widow’s”,by ”,by Employees’ Old Age Benefits (Amendment) Ord. 2002,s. 2(a)
3.
Original Cl. (a) re-numbered as (aa), ibid.
4.
Add. By Finance Act, 1986(Act I of 1986) s.11.1.(a)
5.
Cl. (bb) add by Ord. XVII of 1983.
6.
Omitted 1st proviso of cl.(bb) added by Act I of 1986, by Labour Laws(Amendment) Act, 1994.
7.
Cl. ( c ) subs. By Ord. XVII of 1983, s. 3
8.
Sub-Clause (iii) omitted by Act I of 1986 1[(e)
"establishment " means-
( i ) an establishment to which the West of Pakistan and Establishments Ordinance, l969 (West Pakistan Ordinance No. VIII of 1969) for the time being applies, and notwithstanding anything contained in section 5 thereof, includes
11 clubs, hostel clubs, hostels, s, organisations organisations and messe messess not maintained maintained for profit or gain and establ est ablish ishment ment,, inc includ luding ing hos hospit pitals als,, for the tre treatm atment ent or car caree of sic sick, k, inf infirm irm,, destitute or mentally unfit persons ; ( ii ) a construction industry as defined in the West Pakistan Industrial and Commercial Commer cial Employ Employment ment (Sta (Standing nding Order Orders) s) Ordin Ordinance, ance, 1968 (W (West est Pakis Pakistan tan Ordinance No. VI of 1968); ( iii ) a factory as defined in the Factories Act, 1934 (XXV of 1934); (iv) a mine as defined in the Mines Act, 1923(IV of 1923) ; (v) a road transport service as defined in the Road Transport Workers Ordina Ord inance, nce, 1961 (XX (XXVII VIIII of1 of1961 961)) ; and inc includ ludes es any cla class ss of ind indust ustrie riess or establishments which the Federal Government may, by notification in the official Gazette, declare to be establishments for the p urposes of this Act.] (f) "fund" means the Employees' Old-Age Benefits Fund set up under section l7 ; (g) "industry " means any business, trade, undertaking, manufacture or calling of employers, employers, and includes any calling, service, employment, handicraft industrial occupation or avocation of workmen workmen ; (h) "institution " mea means ns the Emp Employ loyees' ees' Old Old-Ag -Agee Ben Benefi efits ts Ins Instit tituti ution on established or nominated nominated under section 4 [or section 5;] 5;] 2 (i) "insured person" means [an employee] 3 who is or was in insurable employment; (j) "insurable employment " means employment of a person under a contract of service or apprenticeship, whether written or oral, express or implied and in respect of which contributions are payable under this Act; _________________________________________________________________ 1.
Cl. (a) subs. By Ord. XVII of 1983, s.4=1983 PLS 81.
2. Words and figure added. ibid. 3. Subs for “a person”, by Act I of 1986. (k) "invalidity " me mean anss a co cond ndit itio ion, n, ot othe herr th than an th that at ca caus used ed by an empl em ploy oyme ment nt in inju jury ry,, as a re resu sult lt of wh whic ich h an in insu sure red d per perso son n is per perma mane nent ntly ly incapacitated to such an extent as to earn from his usual or other occupation more than one third of the normal rates of earning in his usual occupation ; (1) "member" means a member of the Board ;
12 (m) "prescribed" means prescribed by rules ; (n) "regulations " means regulations made by the Board ; (o) "rules " means rules made under this Act; 1[(oa) [ Omitted} 2[(P) “wages” means the rates of wages as declared under the Minimum Wages for Unskilled Worker Ordinance, 1969 (W.P.Ordinance XX of 1969)”
[(q) “year”, with respect to insurable employment means, a total of three hundred and sixty-five days for which contribution are payable, or, in the case of insured persons who are not paid for weekly holidays, a minimum of three hundred and twelve days.]
1
Self Assessment scheme omitted by Finance Act, 2005.
2
Clauses (p) subs. by Finance Act, 2005.
CHAPTER II INSURED PERSONS
Compulsory Compul sory Insura Insurance nce .- All em 1[3. empl ploy oyees ees in an in indu dust stry ry or establishment shall be insured in the manner prescribed by or under this Act.]
4. Adminis Administration tration.-(1) As soon as may be, after the commencement of this Act, the Federal Government shall establish or nominate by notification an Institution to be called the Employees' Old-Age Benefits Institution.
(2) The Inst Instituti itution on shall be a body corporate having perpetual succession succession and a common seal, with powers, subject to the provisions of the Act, to acquire, hold and dispose of property, both movable and immovable, and shall by the aforesaid name sue or be sued.
13 5. Nom Nomina ination tion of a Bod Body y Cor Corpor porate ate Pend Pending ing Est Establi ablishme shment nt of An Institution.-
(1) No (1) Notw twit iths hsta tandi nding ng any anythi thing ng co cont ntai aine ned d in se sect ctio ion n 4, th thee Fe Fede deral ral Government may, pending the establishment of an Institution, by notification in the official Gazette, nominate a body corporate to exercise and perform all the powers and functions of the Institution under this Act and appoint the head of such body corporate, by whatever name called, to be the 2[Chairman] of the Institution.
(2) The nomination of a body corporate under sub-section (1) shall be subject to such terms and conditions as the Federal Government ma, from time to time, determine.
6. Management. -(1) The general direction and superintendence of the affairs of the Institution shall vest in Board which may, with the assistance of the 2[Chairman] of the Institution, exercise all powers and do all acts and things which may be exercised or done by the Institution.
(2) In discharging its functions, the Institution shall be guided by such instructions on questions of policy as may be given to it from time to time, by the Federal Government, which shall be the sole judge as to whether any instructions are on a question of policy or not. 7. Board of Trustees .-(1) The Board of Trustees shall consist of the following foll owing members to be appointed by b y the Feder Federal al Government, by notif notificati ication, on, namely:-
_________________________________________________________________ ____ 1.
Subs by Finance Act,(Act 1 of 1986)
2.
Subs for word ”head” by Ord. XVII of 1983, s. 5=1983 PLS 81
3. Pt.
Appointments of members notified under S.R.O.588 (1)/76, June, 14=Gaz. Of Pak.Extr. II, 18 June 1976.
14 (a) the Secretary of Additional Secretary in the Labour Division, who shall also be the 1[President] of the Board of Trustees ; 2(b)
the
four persons to represent the Federal Government, one each from Ministries of Finance and Labour;
(c) four per person sonss to rep repres resent ent the Pr Provi ovinci ncial al Gov Governm ernment ents, s, one to be nominated by each of the Provincial Government ; (d) four persons to represent employers ; (e) four persons to represent insured persons ; and 3(f)
one persons to represent the Institution.
(2) Members to be appointed under clause (d) and (e) of sub-section (1) shall respectively be chosen from a list of names submitted in the prescribed manner by the organisations to the employers and employees recognized by the Federal Government for that purpose. Provided Provi ded th that at,, pe pend ndin ing g th thee ma maki king ng of ru rule less in th this is be beha half lf,, th thee fi firs rstt members to be so appointed shall be chosen from such persons as the Federal Government may deem fit. 8. Powers and Functions of the Board of Trustees. In addition to the powers conferred on, and the functions entrusted to it by the other provisions of this Act or by the rules, the Board shall have powers.
(a) to approve the budget estimates, the audited accounts and the annual report of the Institution for submission to the Federal Government in accordance with the provisions of this Act ;[ ]4 (b) to call for any information or direct any research to be made for the furtherance of the objects of the Act[, and]5 6(c)
to co-opt any other technical person by name as member on the Board for a specific purpose and for such limited period as decided by the Board. 7[8A.
-(1)) The Appointm Appoi ntment, ent, Pow Powers ers and Fun Functio ctions ns of Cha Chairma irman. n. -(1 Chairman of the Institution shall be appointed by the Federal Government for such term and on such terms and conditions as it may determine. (2) The Chairman of the Institution shall exercise such powers and perform such functions as m ay be presc pr escrib ribed. ed.]] 1
Subs. For “Chairman”, by Finance Act, 1986 (Act I of 1986), s.11(3);
15 2.
Comas and words comers and Industries Omitted by Finance Act, 2005
3.
For word two the word one was subs. By Finance Act, 2005
4.
Word” and omitted by Employees’ Old Age Benefits (Amendment) Ord. 2002, s. 3
5
Coma and word “ and” added by by Employees’ Old Age Benefits (Amendment) Ord. 200, s.3.
6.
Cl.( c ) inserted by by Employees’ Old Age Benefits (Amendment) Ord. 2002. s. 3 ©
7.
Sec 8-A added by Ord. XVII of 1983, S.7= 1983 PLS 81
CHAPTER III CONTRIBUTIONS
9. Rates and Assessment .- (1) On and from the first day of July, 1976, contribution shall be payable every month by the employer to the Institution in respect of every person in his insurable employment, at the rate of [six]1 per cent of his wages in the prescribed manner;
2[Omitted]
[Provided {omitted}4 that no contribution shall be payable in respect of an insured person who is in receipt of [Old-age pension]5 under this Act or has attained the age of sixty years, or fifty-five years in the case of a woman. 3
6
[Omitted]
(2) Wh (2) Wher eree an in insu sure red d pe pers rson on doe doess not re recei ceive ve any wages wages fr from om th thee employer for any period, the Institution shall, subject to regulations, determine the amount of wages with reference to which the contributions shall be computed.
16 (3) Notwithstanding any agreement to the contrary, the employer shall not deduct from the wages of an insured person or otherwise recover from him any portion of [employer’s share of contribution] 7
8[Omitted]
_________________________________________________________________ ___
1
Word “six” subs for word “five” by Finance Act, 2005
2.
Proviso omitted by Finance Act, 2005.
3.
Subs. By Finance Act, 1986 (Act I of 1986)
4.
Word “Further” omitted by Finance Act, 2005
5. Subs. word “old-age pension” for word” pension, by Employees’ Old Age Benefits (Amendment) Ord. 2002, s. 4(a)(i). 6.
Third proviso Omitted by Finance Act, 2005.
7.
Subs word” Employer’s share of contribution” for words “contribution” by Employees’ Old Age Benefits (Amendment) Ord. 2002, s.4(b)
8.
Sub-Section 4 of Section 9 omitted by Finance Act, 2005.
1[9A.
Contribution by Government - Federal Government may make such contribution to the Institution as it may determined from time to time.
2[9B.
Contribution by the insured person: - On and from Ist day of July 2001, the contribution shall be payable by an insured person at the rate of [one percent of the wages]3 in prescribed manners.
17
10.Records and Returns by Employers. - Every employer shall keep such records and shall submit to the Institution such returns, at such times, in such form and containing such particulars relating to persons employed by him, as may be provided in regulations. 11. Registration of Establishment, Etc .-(1) Every employer shall, before the expiration of thirty days from the day on which this Act becomes applicable to th thee in indus dustr try y or es esta tabl blis ishm hmen entt in re resp spec ectt of wh whic ich h he is th thee em empl ploy oyer er,, communicate to the Institution the name and other prescribed particulars of the industry or establishment
(2) Every insured person may also communicate his name and other prescribed particulars to the Institution. (3) On receipt of a communication under sub-section (1) or sub-section (2) the Institution shall register the name of the industry or establishment or the insured person in such manner, and issue to the insured person a registration card in such from, as may be prescribed. Cancellation of Registration of Establishments, Etc. - The Board may, on the basis of such evidence as the Board may find satisfactory for the purpose, cancel the registration of any establishment or industry which has ceased to exist : 4[11A.
Provided that the cancell Provided cancellation ation of the registration registration of an estab establishm lishment ent or indus industry try shall not affect its liabilities incurred before the date of such cancellation.]
1.
Subs. New s.9A by Finance Act, 1995 s.8. for old s. 9A inserted by Finance Act, 1986( Act 1 of 1986) s. 11(5)
2.
New Sec. 9B inserted by the Labour Laws (Amendment) Ord.2001, (Ord. LIII of 2001), s. 7(4) effective retrospectively from July 1, 2001)
3.
For the words “Twenty rupees” the words “one percent of the wages” are subs. By the Finance Act, 2005.
4.
Sec. 11A added by Finance Act1986 (Act I of 1986, s. 11(6) Gaz. Of Pak. Extr., Pt-I June 29,1986
12. Officials of Institution to Check Employer's Books.-(1) Any official of the Institution, duly authorised authorised by a certificate in a form specified in the regulations, may, may, for the purpose of inquiring into the correctness of any of the particulars stated in the
18 records or returns referred to in section 10 or the purpose of ascertaining whether any of the provisions of this Act have been complied with.(a) require an employer to furnish to him such information as he may consider necessary : or (b) at any reasonable time, enter any establishment establishment or other premises occupied occupied by such employer and require any person found in-charge thereof to produce and allow him to examine such accounts books and other documents relating to the employment of persons and payment of wages, or to furnish to him such information, as he may consider necessary ; or (c) examine, with respect respect to any matt matter er relevant to the purposes purposes aforesaid, aforesaid, the employer, his agent or any other person found in such establishment or other premises, or any other person whom the said official has reasonable cause to believe to be or to have been an insured persons.[ ]1 2[
*
*
*
* ]
3 (2) The officia officiall ref referr erred ed to in sub sub-se -secti ction on (1) shall shall not demand
production of account book and other documents referred to in clause (b) of subsecti se ction on (1 (1)) fo forr a pe peri riod od of tw two o ye year arss fr from om th thee da date te of re regi gist stra rati tion on of th thee st establishment or the 1 day of July, 2005, whichever is later, if the employer does not reduce the number of insured persons in respect of whom contribution are paid under section 9: Provided that on expiry of two years’ period, if the employer enhances the number of insured persons by at least ten percent, it shall be accepted without any question otherwise checking of record shall be done as provided in sub-section (1), by an officer not below the rank of Assistant Director, duly authorized in this behalf and no question shall be asked about the previous two years.; and (3) If an employer fails to maintain records or to submit returns as required by the regulations, or otherwise fails to comply with the provisions of sub-section (1) and thereby makes it difficult to ascertain the identity of persons required to be insured or the amount of contribution payable, the contribution shall be assessed on the basis of such evidence as the Institution may find satisfactory for this purpose. 4[
Omitted]
1. Subs full stop for colon by Employees’ Old Age Benefits (Amendment) Ord. 2002 2. Proviso after cl .( c ) of Sub-Sec.(1) of sec.12 Omitted by Employees’ Old Age Benefits (Amendment) Ord. 2002 3. For sub-section 2 new sub-section and its proviso inserted by Finance Act, 2005. 4. Sec Sectio tion n 12A omi omitte tted d by Financ Financee Act, Act, 2005. 2005.
19 13. Increase of Unpaid Contribution and Recovery of Contribution, Etc., as arrears of land revenue. -(1) If any employer fails to pay, on the due date, the contribution payable by him under sub-section (1) of section 9, the amount so payable by him shall be increased by such percentage or amount as may be prescribed :
Provided that in no case shall such increase exceed fifty per cent of the amount due. (2) Without Without prejudice to any other remedy, remedy, the amount of contribution due, together with the increase provided provided for under sub-section (1), may be recovered as an arrears of land revenue.
1[14.
Safegu Safe guar ard d of In Insu sure red d Pe Pers rson on’’s Ri Righ ghtt in De Defa faul ultt of Pa Paym ymen entt of Contributions Contrib utions by Employ Employers. ers. - Notwithstanding anything contained in this Act, if an insured person has communicated his name and other prescribed particulars to the Institution under sub-section (2) of section 11 and has been issued by the Instit Ins tituti ution on a reg regist istrat ration ion car card d und under er subsub-sec sectio tion n (3) the thereo reoff and, in cas casee of changing employment from one industry or establishment to another industry or esta es tabl blis ishm hmen ent, t, ha hass al also so in info form rmed ed th thee In Inst stit itut utio ion n ab abou outt su such ch ch chan ange ge of employment, then, in the event of default in payment of contributions by the employer in respect of such insured person, such insured person shall have and enjoy the same rights under this Act as if no such default had occurred.]
15. Refund of Contributions Paid Erroneously.- An employer shall be entitled to the refund of any contribution paid to the Institution under erroneous belief that it was payable under the provisions of the Act, and shall be entitled to the refund of excess amount of the contribution where such contribution had been paid at a higher rate than the rate prescribed.
Provided that no contr Provided contributi ibution on or excess amount of any contribution contribution shall be refunded unless as application for such refund is made within six months of the date on which the contribution was paid.
16. Extinguishment of Claims to Contri Contributions butions .- Any claims of the Institution for unpaid contributions shall be extinguished in the manner provided in the regulations.
20 1.
Sec. 14 subs. By Ord. XVII of 1983 s. 9 = 1983 PLS 81
CHAPTER IV FINANCE AND AUDIT
17. Employees' Old-Age Benefits Fund.- (1) The Institution shall have its own fund, to be called the Employees' Old-Age Benefits Fund and may incur out of the Fund such expenditure expend iture as may be necessary for the purposes of this Act.
(2) All contributions paid under this Act and all other moneys received by or on behalf of the Institution shall be paid into the Fund.
(3) The Institution shall derive its revenues from the following sources-
(a) contribution payable under this Act and the rules ;
(b) all other payments made by the employers under this Act and the regulations ;
(c) income from investment of the moneys of the Institution ; and
(d) donations and bequests for the purposes p urposes of this Act.
21
this
(4) The assets of the Institution shall be utilized solely for the purposes of Act.
be
(5) The moneys of the Institution shall be deposited in such banks as may approved by the Board for the purpose.
18. Investments and Loans .-(1) Subject to rules, the Institution may, from time to time, invest any moneys which are not immediately required for expenses under this Act, and may re-invest or realize such investment.
(2) Th (2) Thee In Inst stit itut utio ion n may may,, wi with th th thee pr prev evio ious us sa sanc ncti tion on of th thee Fe Feder deral al Government and on such terms as it may specify, raise loans and take measures for discharging such loans.
19. Bud Budget, get, Acc Accoun ounts ts and Aud Audit it .- (1) The Institution shall draw up annually a budget showing the anticipated receipts and expenditure during the following year and shall submit it to the Board for the approval of the Federal Government.
(2) The Inst Instituti itution on shall maintain maintain account accountss of its income and expendi expenditure ture in such form and manner as may be prescribed.
(3) The books of account of the Institution shall be balanced on the thirtieth of June each year and its accounts shall be audited by auditors approved by by th thee Fe Fede dera rall Go Gove vern rnme ment nt at su such ch ti time me an and d in su such ch ma mann nner er as ma may y be prescribed. (4) The auditors shall at all reasonable times have access to the books of accounts and other documents of the Institution and may, for the purposes of the audit call for such explanation and information as they may require and may examine any principal or other officer of the Institution. (5) The audi auditor torss sha shall ll for forwar ward d to the Fed Federa erall Gov Govern ernmen mentt an annu annual al reportof it work and activities.
22 Thee In Inst stit itut utio ion n sh shal alll su subm bmit it to th thee Fe Fede dera rall 20. An 20. Annua nuall Re Repo port. rt.-- Th Government an annual report of its work and activities. 1[21.
Institution shall, at Valua aluation tion of Ass Assets ets and Liab Liabiliti ilities. es.- The Institution intervals of not more than three years, have an actuarial valuation made in the prescribed manner of its assets and liabilities and no chang e in rate of contribution or benefit under this Act shall be made without proper actuarial valuation: Provided that the Federal Government may direct a valuation to be made at such other times as it may consider necessary necessary..
1. Subs. for section 21 by Employees’ Old Age Benefits (Amendment) Ord. 2002. s. 7
CHAPTER
V
BENEFITS 22. 1[Old-Age Pension]. 2[(1)
An insu insured red person shall entitled entitled to a mont monthly hly old-age pension pension at the rate specified in the schedule. Provided that: (a) he is over [sixty] 3 years of age, or [fifty-five] 4 years in the case of a woman; and (b) contributions in respect of him were [paid] 5 for not less than fifteen years[.]6
7[Provided
further that the age specified in clause (a) will be reduced b y five years in the case of an insured person employed in the occupation of mining for at least ten years immediately preceding retirement [:] 8
9[Provided
also that where the employee was insured under the provisions of this Act on or before 30th June 2002, and contributions payable under the Act by the employer employ er prior to to 30th June, June, 2002, 2002, in respec respectt of said insur insured ed person person had not not been paid,, the paid
23 insured perso insured person n shall shall enjoy the righ rights ts under under this Act as if if for for the the word word "paid" were not substituted:
"payable" "paya ble" the word
"Provided further that where the contribution under section 9B is paid regularly by the insured person himself in accordance with prescribed procedure, his entitlement to the benefit shall not be affected affected by default in payment of employer's employer's share of contribution under under section 9."; and (2) If an insured person was on the first day of July, 1976, or is on any day thereafter on which this Act becomes applicable to an industry or establishment,-
( i ) over forty years of age, or thirty-five years in the case of a woman, clause (b) of sub-section (1) shall have effect as if for the word "seven" were substituted : or
(ii) over forty-five years of age or forty years in case of a woman, clause (b)of sub-se sub -secti ction on (1) sha shall ll hav havee eff effect ect as if for the wor word d "fifte "fifteen" en" the therei rein n the word "fi "five" ve"wer weree substituted. __________________________ _____________ __________________________ __________________________ _________________________ _______________ ___ 1.
Subs. For “Old-age Allowance” by Act XVII of 1983, s. 2 = 1983 PLS 18.
2.
Sub-sec(1) and (2) subs. ibid.
3.
Subs. For “fifty Five “, by Finance Act, 1986(Act I of 1986), s. 11(7)(A)(a)(i); Gaz. of Pak. Extr. Pt. I, June 29,1986.
4.
Subs. For “fifty”,ibid.
5.
Subs Su bs.. wo word rd ”p ”pai aid” d” fo forr ”p ”pay ayab able le”” by Empl Employe oyees’ es’ Old Age Ben Benefi efits ts
(Amendment) Ord. 2002. s. 8(a)(i) 6.
Colon subs for fullstop, ibid s. 11(7)(A)(a)(i)
7.
second proviso added, ibid s. 11(7)(A)(a)(i)
8.
Subs. colon for semicolon at the end of IInd proviso by Employees’ Old Age
Benefits (Amendment) Ord. 2002. s. 8(a)(ii 9.
Inserted Inse rted IIrd and IVth provi proviso so after secon second d prov proviso iso by Employees’ Old Age
Benefits (Amendment) Ord. 2002. s. 8(a)(iii). 1[(2A)
person-
Notwithstanding anything contained in sub-section (1), an insured
24 (a) who was was insured insured under the provisi provisions ons of this this Act Act on or before the 30th June, 1986, and will attain the age of (fifty-five years in the case of woman) on or before the 30th June, 1991, and
(b) in respect of whom contributions were payable to the Institution for the period period required under the provision provision of this Act, Act, shall been entitled entitled to old-age pension at the age of fifty-five fifty-five years (fifty years in the case of woman).
1[(2B)
An insured person already in receipt of an old-age or invalidity pension, or entitled to an old-age pension under the provisions of sub-section (2A), shall be entitled to a minimum pension at the rate specified in the Schedule.
1[(2C)
An insured person who retir retired ed from insurable insurable employ employment ment before attaining the age of sixty years (fifty-five years in the case of woman) but after attaining the age of fifty-five years(fifty years in the case of a woman) shall be entitl ent itled ed to a red reduce uced d oldold-age age pens pension ion on ful fulfil fillin ling g the fol follow lowing ing cond conditi itions ons,, namely :(a) the Ins Instit tituti ution on is sat satisf isfied ied thr throug ough h docu documen mentary tary evidence evidence tha thatt the employ emp loyer er has a def defini inite te est establi ablishe shed d ret retire iremen mentt age of les lesss tha than n six sixty ty yea years rs (fifty-five years in the case of woman) ; (b) the employer certifies that the insured person has been retired by him on attaining the age of superannuation ; and (c) the con contri tribut bution ionss in res respect pect of him were [pa [paid] id]2 required under the provision of this Act.
1[(2D)
for the period
The old-age pension shall be reduced by one half per cent of the Old-Age Pension specified in the Schedule for each completed month by which the age falls short of sixty years years (fif (fifty-f ty-five ive years in the case of woman) and the minimum old-age pension shall be reduced in the aforesaid manner in the case of retirement from insurable employment before attaining the age of sixty years (fifty-five years in the case of woman.
25 1[(2E)
The reduction in old-age pension specified in sub-section (2D) shall be for life and shall not be restored on the insured person's attaining the normal pension age.] ----------------------------------------------------------------------------------------------------1. Sub-sectio Sub-section n (2A), (2A), (2B),(2C)(, (2B),(2C)(, (2D) and and (2E) added added,, ibid, ibid, s. 11(7)( 11(7)(B) B) ubs. s. wor ord d “ pai aid d” for wor ord d “ pay ayab ablle” by Emp 2. sub Employ loyees ees’’ Old Age Bene Benefit fitss
(Amendment) Ord. 2002. s. 8(b)
(3) Subject to regulations, the [old-age pension]1 shall commence as from the month following that in which the insured person satisfies the condition for entitlement thereto, provided that no [Benefit] shall be payable retro-actively for more than six months preceding the month in which an application for [old-age pension]1 is submitted.
(4) Insurable employment of a person for the purposes of this Act shall comme com menc ncee on th thee dat datee fr from om whi which ch th thee fi firs rstt con contr trib ibut utio ion n in re resp spec ectt of hi him m becomes payable.
(5) The [ol [old-a d-age ge pens pension ion]]1 pa pay yab able le to an in insu sure red d pe pers rson on sh shal alll be terminated at the month in which the death of such persons occurs.
(6) [Omitted] 2
Old-Age Grant .- If an insured person, not otherwise entitled to old-age pension, retires from insurable employment after attaining the age of sixty years, or fifty-five years in case of woman and a mine worker, and contributions in respect of him were payable for less than fifteen years, but not less 4[than two] years, he shall be entitled to an old-age grant payable in a lump sum equal to his one mon month' th'ss aver average age mon monthly thly wages for every comp complet leted ed ye year ar of ins insura urable ble employment or part thereof in excess of six months[:]5 3[22A.
"Provided that where the employee was insured under the provision of th Act on or befor beforee 30th June 2002, and contri contributio butions ns payablee under payabl the Act by the the employ emp loyer er prior prior to to 30th June June 2002 2002 in resp respect ect of said said insu insured red
26 person had not been paid, the insured person shall enjoy the rights under this Act as if for the word "payable" the word "paid" were not substituted: Provided further that where the contribution Provided contribution under secti section on 9B is paid regularly by the insured person himself in accordance with prescribed procedure, his entitlement to the benefit shall not be affected by default in payment of employer's share of contribution under section 9." _________________________________________________________________ ____ 1.
Sub. For “Old-age Allowance” by Or. XVII of 1983.
2.
Omitted by Finance Act, 1986.
3.
Sections 22A subs. for original, by Finance Act, 1986(Act I of 1986), s. 11(8), Gaz. of Pak. Extr. Pt. I, June 29,1986.
4.
Subs. For words” than five” by b y s. 8(4) of Labour Laws (Amendment) Act, 1994.
5.
For full stop at the end of secti section on 22A colon shall be subs and thera therafter fter two provisos provisos shall shall be added added ” by Employees’ Old Age Benefits (Amendment)
Ord. 2002. s. 9 (b). 1[22B.
Survivors' Pension
(1) In the case of the death of an insured person while in insurable employment employ ment but after he had completed not less than thirty six months insurable employment, the surviving spouse, if any, shall be entitled to a life pension equal the minimum pension: 2[ ***] the 3[(1A)
In case of death of an insured person, while not in insurable employment but after h had completed five years insurable employment, the surviving spouse, if any, shall be entitled to a life pension equal to the minimum pension. (2) In the case of the death of an insured person who had become entitled to old-age pension or [ invalidity pension]5 before his death, the surviving spouse, shall, if the spouse had married the deceased person before he had attained the minimum age prescribed for old-age pension, receive life pension [ equal to ]6 the pension of such person. 4[(
3 ) In case the deceased of the surviving spouse in receipt of a survivor’s pension, the minor children of the dec eased insured person, if any, shall be entitle ed to the survivor’s pension, in the following equal shares, namely;(i)
In case of a male child, ch ild, until he attains eighteen years of age, and
27 (ii)
In case of female child, until she attains eighteen years of age or until marriage, whichever is earlier. 5[(2A)
In the case of cessation of survivor’s survivor’s pension of any of the children of the deceased insured person person on his attaining the age of eighteen years or marriage incase of a female, or death, as the case may be, the share of survivors pension received by such child shall be distributed equally among the rest of the minor children of the deceased insured person. 6[(3B)
In case of death of the survi surviving ving spouse in receipt receipt of a survi survivor’ vor’ss pension within five years after the death of the insured person and not survived by any minor child of the deceased insured person, the survivor’s pension shall be paid to the surviving parents of the deceased insured person, if any any,, for a period of five years from the death of said spouse. __________________________ _____________ __________________________ __________________________ _________________________ _________________ _____ 1.
Sections 22A and 22B subs.for original, by Finance Act, 1986(Act I of 1986), s. 11(8), Gaz. of Pak. Extr. Pt. I, June 29,1986.
2.
Omitted words” sixty percent of” ibid s. 8(5)(a)
3. New Sub-sec.1A added, ibid s. 8(5)(b) 4.
Sub-Sec.3 subs. For the original , , ibid ibid s. 8(5)(d)
5.
Sub-Sec.3A subs., ibid ibid s. 8(5)(d)
6.
Sub-Sec.3B subs, ibid ibid s. 8(5)(d) 8(5)(d)
1[(4)
In case case of the death of an insured person who is not survived by a spouse, the survivor’s pension shall be paid to the minor children of the deceased insured person referred to sub-section (3) and sub-section (3A), and in the case of the insured person not surviving any minor child, the survivor’s pension shall be paid to the surviving person, if any,, for a period of five years from the death of insured person. any
23. 2[Invalidity Pension].-
(1) An insured person who sustains invalidity shall be entitled to an [invalidity pension]2 at the rate [to be calculated according to the formula set out in the schedule] 3[:]4
28
5["Provided
that where the employee was insured under the provision of this Act on or before 30th June 2002, and the contribution payable under the Act by the employer prior to 30th June 2002, in respect of said insured person had not been paid, the insured person shall enjoy the rights under this Act as if for the word "payable" the word "paid" were not substituted in clause (a) and (b): 5[Provided
further that where the contribution under section 9B is paid regularly by the insured person himself in accordance with prescribed procedure, his entitlement to the benefit shall not be affected by default in payment of employer's share of contribution under section 9." Provided that(a) contribution contribution in respec respectt of him were [paid]6 for not less than fifteen years ; or (b) contributions in respect of him were [paid]6 for not less than five years since his entry into insurable employment and for not less than three years during the period of five years preceding the month in which he sustains invalidity ; and (c) in either case, he is under [sixty] 7 years of age, or [fifty-five]7 years in the case of woman. _________________________________________________________ 1.
Sec.4 subs. , ibid s. 8(5)(e)
2.
Subs for “invalidity Allowance” by Ord. XVII of 1983 s.2
3.
Subs. For words” of seventy five rupees per month”, ibid. s.12
4.
For full stop stop,, at the end of subsub-secti section(1) on(1) colo colon n subs subs.. by Employees’
Old Age 5.
Benefits (Amendment) Ord. 2002. s. 10 (b).
Provisos added by Employees’ Old Age Benefits (Amendment) Ord.
2002.s.10 (b). 6.
For word “payable” the word “paid” subs. ibid s. 10(a)
6.
Subs. for “fifty-five” and “fifty” by Finance Act, 1986
(2) Subject to regulations, the [invalidity pension]1 shall be payable from from thee mo th mont nth h fo foll llow owin ing g th that at in wh whic ich h th thee in insu sure red d per perso son n sa sati tisf sfie iess th thee conditions for entitlement thereto :
29 Provided that the [invalidity pension]1 shall not be payable retroretro-active actively ly for more than six months preceding the month in which as application for the [invalidity pension]1 is submitted. (3) The [in [inval validi idity ty pen pensio sion] n]1 sh shal alll be pay payabl ablee so lo long ng as in inva vali lidi dity ty continues :
Provided that an insured person who has been in receipt of the [invalidity pension]1 for not less than five continuous years or attains the age specified in clause clau se (a) of sub sub-se -secti ction on (1) of sec sectio tion n 22 sha shall ll be ent entitl itled ed to the [in [inval validi idity ty pension]1 for life. 1.
Subs. for “invalidity allowance” by Ord. XVII of 1983. s.2
CHAPTER VI PROVISIONS COMMON TO ALL BENEFITS
24. Calculation of Qualif Qualifying ying Contribution Periods. - In calculating the contribution periods for entitlement to a benefit under this Act, periods in respect of which [invalidity pension]1 has been paid to an insured person prior to his reaching the age of [sixty]2 years, or [fifty-five] 2 years in the case of woman, or periods in respect of which maternity benefit or sickness benefit or injury benefit or total disablement pension have been paid under the West Pakistan Employees' Social Security Ordinance, 1965 (West Pakistan Ordinance No. X of 1965), to an insured person shall be deemed to be contribution periods to such extent as may be provided by regulations.
25. Benefit Claims and Payments.- (1) All claims for [a benefit] 3 under this Act shall be made in writing and shall be accompanied by such documents, information and evidence as to entitlement as may be provided by regulations.
(2) Payment of [a benefit]3 shall be made in such manner, and at such times and places, as may be provided p rovided by regulations.
30 26. Extinguishment of Benefits .- A right to [any benefit]4 shall stand extinguished where a claim therefore is not made within twelve months of the date on the [benefit]4 becomes payable:
5[Provided
that the Institution may condone the delay and admit the claim if it is satisfied that the delay was caused for reasons beyond the control of the insured person or the [survivor]6.
7[27.
Suspension Suspens ion of Old Old-Age -Age Pen Pension sion and [Su [Surviv rvivor's or's Pen Pension sion]] 8. Subject to regulations, payment of old-age pension and [survivor's pension]9 shall be suspended when and so long as the insured person or the [survivor]10 entitled to it is absent from Pakistan, except where the regulations provide otherwise].
_________________________________________________________________ ____ 1. Subs. For “invalidity allowance” by Ord. XVII of 1983. s. 2 2. Subs. For words “fifty five” and “fifty” respectively by Finance Act, 1986 (Act I of 1986)
3.Subs. for “ an allowance”, by Ord XVII of 1983, S.2 4. Subs for words” the invalidity allowance or old-age allowance”, S.13 ibid. 5. Proviso added, ibid 6 Subs. for “Surviving Widow”, by Act 1 of 1986 S. 11(11) 7. Section 27 subs. by Ord. XVII of 1983, 1 983, s. 14= 1983 PLS 81. 8. Subs. for “widow’s pension”, by Act 1 of 19 86 9. Subs. for “widow’s pension”, by Act 1 of 19 86 10. subs. for” surviving widow” ibid.
28. Non-Duplication of [Benefit]. (1) An insured person shall not be paid for the same period more than one of the [benefits]1 provided for this Act.
31
(2) Where an insured person is entitled to more than on [benefit] 1 under this Act, Act, he shall be given the higher of such [benefits]1. (3) Where an insured person is entitled to [a benefit]2 under this Act and to a dis disabl ableme ement nt pens pension ion unde underr the West Pak Pakist istan an Emp Employ loyees' ees' Soc Social ial Sec Securi urity ty Ordinance, 1965 (West Pakistan Ordinance No. X of 1965) he shall be given the higher of the two. (4) The [invalidity pension]3 shall not be payable to an insured person so long as he receives the sickness benefit under the West Pakistan Employees' Social Security Ordinance, 1965 (W (West est Pakistan Ordinance No. X of 1965). 29. [Benefit] Nor Attachable, Chargeable Or Assignable. - [A benefit]3 payable under this Act shall not be liable to attachment in the execution of a decree, nor shall it be chargeable or assignable ; and any agreement to charge or assign [a benefit]3 shall be void, and on the bankruptcy of an insured person, the [benefit]1 payable to him shall not pass to any trustee or person acting on behalf of his creditors. 30. Repayment of 5[benefit] Improperly Received .-(1) When a person has received any [benefit]1 under this Act to which he is not lawfully entitled, entitled, he shall be liable to repay to the Institution the amount of the [benefit] 1 in such manner as may be provided b y regulations :
Provided that the Institution may waive repayment of [a benefit]2 where payment thereof was not due to misrepresentation on the part of the insured person receiving it and the repayment would cause undue hardship to him. (2) Sums due to the Institution by virtue of the foregoing sub-section may be recovered by deduction from [a benefit]3 payable under this Act. 31. Institut Institution's ion's Right to Be Indemnified in Certain Cases .- Where the contingency for which [a benefit]3 is payable under this Act was caused under circumstances creating a legal liability in some person, the Institution shall be entitled to substitute itself for the insured person in bringing a suit for damages against that person. 32. Rec Recover overy y of Amounts Amounts Due Due.. - Any amount recoverable under this chapter may be recovered as an arrear of land revenue.
_______________________________________________________________________ _ 1. Sub Subss for for “ allow allowanc ance” e” by Ord Ord.. XVII XVII of 1983 1983
32 2. Subs Subs fo forr “ an al allo lowa wanc nce” e” 3. Subs for “ invalidity allowance”, ibid.
CHAPTER VII
DETERMINATION OF QUESTIONS AND CLAIMS
33. Decision on Complaints, Questions and Disputes .- If any complaint is received or any question or dispute arises as to-
(a) Whether a person is an insured person within the meaning of this Act ; (b) the amount of wages of an insured person for the purposes of this Act ; (c) the amount of contribution payable by an employer in respect of an insured person ; (d) the person who is the employer e mployer in respect of an insured person ; 1[(e)
entitlement to any benefit under this Act or as to the amount and duration thereof ; and ] 2[(ee)
registration of industry or establishment ; or]
(f) any oth other er mat matter ter in res respect pect of any contribu contributio tion n or any [benefit] [benefit]3 referred to in clause (e), or dues payable or recoverable under this Act relating to contributions or the aforesaid [benefits]4 the matter shall be decided by the Institution, in such manner, and within such time, as the regulations may provide and the Institution shall notify its decision to the person concerned in writing, stating therein the reason for its decision. 34. Review of Decisions .- The Institution may, subject to regulations, on new facts being brought to its notice, review a decisi decision on given by it under section 33.
Provided that no decision shall be so reviewed without giving the person concerned an opportunity of being heard and adducing evidence in support of, or against, the decision, as the case may be.
33 35. Appeal to Board. Subject to rules, a person aggrieved by a decision of the Institution under section 33 or on a review under section 34, may appeal to the Board. 36. Assessment of Invalidity . The Institution shall appoint medical boards which shall, in such manner as may be provided by regulations, assess the degree of invalidity sustained by an insured person.
_________________________________________________________________ ___ 1. Cl. (e) subs. by Ord. XVII of 1983, s. 15 2. Cl. (ee) added, ibid 3. Subs. for “allowance”, ibid s.2 4. Subs. for “ allowances”, ibid s.2
CHAPTER VIII OFFENCES AND PENALTIES 37. Offences.-If any person-
For the purpose of obtaining [a benefit]1 or denial of any payment or [benefit]2, under this Act, whether for himself or some other person, or for the ;purpose ;purp ose of avoiding any payment payment to be made by him or any other person person under this Act. (i) kn (i) know owin ingly gly ma makes kes or ca caus uses es to be mad madee fa fals lsee st stat atem emen entt or fa fals lsee representation; or (ii) produces or furnishes, or cause, or knowingly allows to be produced or furnished, any document or information which he knows to be false in any material particular ; or (b) fails to pay any contri contribution bution which under the Act he is liabl liablee to pay ; or (c) recovers or attempts to recover from an insur insured ed person, or deducts or attempts to deduct from his wages, the whole or any part of the 3[ employer’s share of contribution] ; or
34 (d) fails or refuses to submit any return required by this Act, or regulations or makes a false return ; or (e) obstructs any official of the Institution in the discharge of his duties ; or (f) is guilty of any contravention of, or non-compliance with, any of the provisions of this Act or the rules or the rules or the regulations, he shall be punished with imprisonment for a term which may extend to two years, or with fine which may extend to ten thousand rupees, or with both. 38. Prosecution. - (1) No prosecution under this Act shall be instituted except with the previous sanction of the Federal Government or any office or authority [authorized]4 in this behalf by it.
(2) No court inferior to that of a Magistrate of the first class shall try any offence under this Act. (3) No court shall take cognizance of any offence under this Act except on a complaint made in writing within six months of the date on which the offence comes to the knowledge of the Federal Government or any officer or authority referred to in sub-section(1). _________________________________________________________________ ____ 1.
Subs, for” an allowance: by Ord.XVII of 1983 s.2
2.
Subs, for” allowance: by Ord.XVII of 1983 s. 2
3.
Subs. words “employer’s share of contribution” by Employees’ Old Age Benefits
(Amendment) Ord. 2002.s.11. 4.
Chairman, EOBI authorized Chairman, authorized to sanct sanction ion the Institution Institution of prose prosecuti cution on for off offences ences committed under Act. No. SRO 398(1)/86 dated. 6/4/86 amended by notification dated 6/7/86.
CHAPTER IX MISCELLANEOUS
35 39. Contributions Etc. - In any proceedings of insolvency against a person or proceedings for winding up of a company, any contribution or other amount payable under this Act by such person or company shall be deemed to be included among debts to be paid in priority to all other debts. 40. Exemption From Stamp Duty .- Stamp duty shall not be chargeable upon any documents used in connection with [benefits]1 payable under this Act. 41. Exemption From Taxes.- Notwithstanding anything contained in any other ot her la law w, th thee Fe Feder deral al Go Gove vern rnme ment nt may may,, by or order der in wr writ itin ing, g, exe exemp mptt th thee Institution from any tax, duty, or rate leviable by the Federal Government or by a local authority under the control of the Federal Government. 42. Member and Servants of the Institution to Be Public Servants. The members and employees of the Board and all officers and servants of the Institution shall be deemed to be public servants within the meaning of section 21 of the Pakistan Penal Code (Act XLV of 1860). 43. Delegation of Powers.- The Board may direct that all or any of its pow power erss an and d fu funct nctio ions ns may may,, in re rela lati tion on to su such ch ma matt tter erss and su subj bjec ectt to su such ch condit con dition ions, s, if any any,, as may be spe specif cified ied,, be als also o exer exercis cisabl ablee by any officer officer or authority subordinate to the institution. 44. Power to Make Rules. -(1) The Federal Government may, subject to the condition of previous publication in the official Gazette, make rules to carry out the purposes of this Act.
(2) In particular, and without prejudice to the generality of the foregoing power, such rules may provide for all or any of the following matters, namely :(i) th (i) thee te tenu nure re of of offi fice ce of me memb mber erss of th thee Bo Boar ard, d, ot othe herr th than an th thee [President]2, and other terms and conditions of appointment of the members of the Board and the manner in which the Board shall conduct conduct its business, business, including including the number of members required to form a quorum at the meetings thereof _________________________________________________________________ ___ 1.
Subs, for “allowance”: by Ord.XVII of 1983 s. 2
2.
Subs. word ‘President for words “Chairman” by Employees’ Old Age
Benefits (Amendment) Ord. 2002.s.12. (ii) the manner in which names of persons from whom members of the Board may be appoin appointed ted shall be submitted by organ organizati izations ons of employ employers ers and employees recognized by the Federal Government for the purpose ; (iii) powers and functions of the Board.
36 (iv) fees and [benefits] [benefits]1 of the members of the Board ; (v) ti (v) time mess an and d ra rate tess at wh whic ich, h, an and d co cond ndit itio ions ns su subj bjec ectt to wh whic ich, h, contributions shall be payable. (vi) per (vi) percent centage age or amo amount unt by whi which ch cont contrib ributi utions ons in arr arrear earss may be increased under section 13 ; (vii) inv (vii) invest estmen mentt of sur surplu pluss mon moneys eys,, rea realis lisati ation on of inv invest estmen ments ts and reinvestment of proceeds; (viii) terms at which and the manner in which the budget of the Institution shall be prepared and submitted to the Federal Government. (ix) the form and manner in which the Institution shall keep accounts of its income and expenditure and of its assets assets and liabilities ; (x) the tim times es at which, and the man manner ner in whi which, ch, the acco account untss of the Institution shall be audited ; (xi) the matters which the annual report of Institution shall cover ; (xii) the times in which claims for [a benefit]2 shall be made ; (xiii) the manner and procedure for disposal of appeals by the Board ; and (xiv) any other matter which is required to be b e or may be prescribed. _________________________________________________________________ ___ 1.
Subs, for “allowance”: by Ord.XVII of 1983 s. 2
2.
Subs, for “an allowance”: by Ord.XVII of 1983 s.2
-(1) 1) Th Thee Bo Boar ard d ma may y, su subj bject ect to 45. Po 45. Powe werr to Ma Make ke Re Regul gulati ations ons.. -( condition of previous publication, by notification in the official Gazette, make regulations not inconsistent with the provisions of this Act or the rules. (2) In particular, and without prejudice to the generality of the foregoing power, such regulations may provide for all or any of the following matters, namely :(i) the time and places at which meetings of the Board shall held ; (ii) the manner in which daily wages shall be calculated for the purpose of determining the contribution payable ;
37 (iii) determ (iii) determinatio ination n of wages for computation computation of contributions contributions where the mode of payment of remuneration, in cash or kind, makes such computation difficult. (iv) records to be kept and returns to be submitted by employers, time at which and the form in which such returns are to be submitted, and particulars relating to the insured persons to be stated in such returns and the manner and from for registration of employers and insured persons ; (v) th (v) thee ma mann nner er in wh whic ich h an any y cl clai aim m of th thee In Inst stit itut utio ion n fo forr un unpa paid id contributions may be extinguished ; (vi) powers and duties of internal auditors. (vii) [omitted.]1 (viii) the for (viii) form m and manner in whi which ch clai claims ms for [a bene benefit fit]]2 shall be preferred, and the documents, information and evidence which shall accompany such claims ; (ix) the manner (ix) manner in which and the time and pla places ces at whi which ch pay paymen mentt in respect of [a benefit] shall be made ; (x) the manner in which and the time within which complaints, questions and disputes shall be decided ; (xi) the circumstances and the manner in which, on new facts coming to light, the Institution may review decisions ; ________________________________________________________________ ____ 1. Cl.(vii) omitted by Act I of 1986 s. 11(13) 2. Subs, for “an allowance”: by Ord.XVII of 1983 s.2
(xii) the method of payment of contributions and liability thereof ; (xiii) the manner in which invalidity shall be assessed and the procedure thereof ; (xiv) the manner in which proof of age shall be furnished for the purposes of this this Act ; (xv) the manner in which the services of the Institution shall be organised ; and
38 (xvi)) any other (xvi other ma matt tter er not provid provided ed fo forr in th this is Act or th thee ru rule less and necessary to give effect to the provisions of this Act. 46. Power of Exempt. - The Federal Government may, subject to such conditions as it thinks fit to impose, by notification in the official Gazette, exempt any establishment or industry from all or any of the provisions of this Act. 47. Act Not to Apply to Certain Persons. - Nothing in this Act shall apply to(a) persons in the service of the state, including members of the armed forces, police force and railway servants
(b) persons persons in the service of the local council, a municipal municipal committee, committee, a cantonment board or any other local authority ; (c) persons who are employed in services or installations connected with or incidental to the Armed Forces of Pakistan including an ordinance factory maintained by the Federal Government or Railway Administration ; (d) persons in service of Water Water & Power Development Develop ment Authority ; (e) persons in the service of a bank or a banking company ; (f) person in the service of statu statutory tory bodies other than those employ employed ed in or in connection with the affairs of a factory [as defined in]1 section 2 (j) of the Factories Facto ries Act, 1934 (XXV of 1934), 1934), [or a mine as define defined d in the]2 Mines Act, 1923 (IV of 1923) : Provided that workshop maintained exclusively for the purposes of repair or maintenance of equipment or vehicles used in such statutory bodies shall not be treated as factories for the purposes of this clause ; _________________________________________________________________ ____ 1. Subs. for” registered under” , by Ord. XVII of 1983 s. 16= 1983 PLS 81. 2. Sub. For “or the” ibid. (g) members of the employer's family, [that is to say, the husband or wife and the dependent children of the employer]1 living in his house, in respect of their work for him ; and (h) [Omitted.]2 48. Repealed by Ord. XXVII of1981,s.3 & 2nd Schedule.
39 1.
Words inserted inserted,, ibid.
2.
Cl. (h) omitted by Act I of 1986, s. 11(14).
1[SCHEDULE]
(See sections 22 & 23)
(1) The monthly rate of old-age pension or invalidity pension payable to an insured person shall be calculated in accordance with the following formula, namely :-
Average monthly wages x Number of years of o f insurable employment __________________________________________ 50 A period of six months of more on insurable employment shall be treated as one full year. No account shall be taken of any period of insurable employment employ ment completed by the insured person after becoming becoming entit entitled led to old-ag old-agee pension. (2)The average monthly wages of an insured person, referred to in paragraph (1) shall be calculated on the twelve calendar months immediately preceding the date on which the insured person fulfills the conditions specified in section 23 as the case may be:
Provided that the old-age pension or invalidity pension payable to an insured person shall not be less than [one thousand]2 rupees per month for pension commencing on or after the first day of [January,2005]3.
4[
*
*
*
*]
40 _________________________________________________________________
1. Schedule subs for original schedule ibid, s. 11(15) 2. Substituted for words “seven hundreds “by Finance Act, 2005. 3. Substituted for words “November 2001“by Ord. No 1 o f 2002, s.2(b) 4. Paragraph 3 and table omitted, ibid.
CIRCULAR NO. 02/2005-06 )
The Empl Employe oyees’ es’ Old-Ag Old-Agee Bene Benefit fitss Act Act,, 1976 has bee been n ame amended nded thr through ough Finance Act 2005. The notification in this regard has been published in the Gazette of Pakistan, Extraordinary, Part-I, dated 1st July 2005, as Act VII of 2005. Through these amendments, minimum pension has been enhanced from Rs. 700/= to Rs. 1000/= per month, Contribution has been linked with minimum wages for unskilled workers, Self-Assessment Scheme has been discontinued and verification of books of accounts has been restricted. The salient features of these amendments are as under: 1.
Omission of Clause (oa) of Section 2:
In Section 2 of the Act, the Clause (oa), defining “Self-Assessment Scheme” has been omitted. Further omission of Section 12-A has stopped the operation of Self-Assessment Scheme w.e.f. 01-07-2005. The employers who had opted for Self-Assessment Scheme shall now be required to pay contribution @ Rs. 210/ per IP, per month ( Rs. 180/- per month as employers contribution and Rs. 30/ per month as IP’ IP’ss contribution) from 01-07-2005 onwards like other employers. emplo yers. 2.
Amendment in Clause (p) of Section 2
The de The defi fini niti tion on of th thee te term rm “ Wage ages” s” has al also so be been en su subs bsti titu tute ted d by a ne new w definition which is as under: “Wages” means the rate of wages as declared under the Minimum Wages for unskilled Workers Ordinance, 1969 (W.P. Ordinance XX of 1969)
41 This amen This amendme dment nt has sim simpli plifie fied d the def defini initio tion n of the ter term m “wa “wages ges”. ”. After incorporation of new definition the employer has to pay contribution @ 6% of wages for each employee in his insurable employment i.e. Rs. 180/= per month per employee. IPs contribution has also been revised as 1% of wages, making it Rs. 30/- per IP per month. 3.
Amendment in Clauses (b) and (f) of Sub-Section (1) of Section 7.
Through these amendments in Section 7 of the EOB Act, the number of the memb me mber erss of Bo Boar ard d of Tru rust stee eess (B (BOT OT)) ha hass bee been n de decr crea ease sed d fr from om 19 to 16 withdrawing the representatives of Ministry of Commerce & Industries and FA, EOBI from the Board. Now there is equal representation of Government and Private members on the Board as under: Secretary,, Labour, Secretary Labo ur, Manpower Division. Joint Secretary, Labour, Manpower Division. Financial Advisor, Labour. Chairman, EOBI. Four Provincial Secretaries, Labour La bour.. Eight representatives of employers and employees from the four provinces. 4.
Amendment in Section 9
Through the amendment in section 9 of the Act, the rate of contribution has been enhanced from 5% to 6% of the wages. The first proviso of Section 9, fixing the maximum ceiling of Rs. 3000/= of wages on which contribution was payable has been omitted. With the change in the definition of “Wages” as the “minimum wages”, the employer’s contribution has become almost as a flat rate of Rs. 180/= per month. With the omission of the first proviso though it seems that the cap of the maximum maximu m wages on which contribution contribution is payabl payablee has been removed but if we read Section 9 with Section 2 (p) it be comes clear that contribution is payable @ 6% of wages which has been defined as minimum wages i.e. Rs. 3000/= presently. Thus contribution cannot be collected on the wages in excess of mini mi nimu mum m wa wage gess wh whic ich h is Rs Rs.. 30 3000 00.. Af Afte terr am amen endm dmen entt of th this is Se Sect ctio ion, n, cont co ntri ribu buti tion on pay payabl ablee by the em empl ploy oyer er fo forr al alll em empl ploy oyees ees in hi hiss in insu sura rabl blee employment will be 6% of the wages as defined under Section 9 of the Act.
42 5.
Amendment in Section 9-B
Through the amendment in Section 9B the rate of employees’ contribution has also al so bee been n br broug ought ht in li line ne wi with th th thee em empl ploy oyer’ er’ss con contr trib ibut utio ion. n. Af Afte terr th this is amendment Insured Person’s contribution shall be 1% of the wages i.e. Rs. 3000/= presently as defined under Section 2(p). 6.
Amendments in Section 12
Section Secti on 12 of th thee EO EOB B Ac Actt de deal alss wi with th ch check eckin ing g of em empl ploy oyer’ er’ss boo books ks of accounts. Its Sub-Section (2) has been substituted as under: “(2). The official referred to in Sub-Section (1) shall not demand production of account books and other documents referred to in clause (b) of Sub-Section (1) for a period of two years from the date of registration of the establishment or the 1st day of July, 2005, whichever is later, if the employer does not reduce the number of insured persons in respect of whom contribution are paid under Section 9. Provided that on expiry of two years’ period, if the employer enhances the number of insured persons by at least ten per cent, it shall be accepted without any question otherwise checking of record shall be done as provided in SubSecti Se ction on (1 (1), ), by an of offi ficer cer no nott bel below ow th thee ra rank nk of Assist Assistan antt Di Dire rect ctor or,, dul duly y authorized in this behalf and no question shall be asked about the previous two years.” The above amendment implies that in case of registered employers, from 1st July 2005 onwards and in case of newly registered establishment, from the date of registration there shall be no verification/examination of books of accounts for two years provided the employer does not reduce the number of Insured Persons on whose behalf he is making payment. In case the employer reduces the number of Insured Persons during these two years, his books of accounts shall be verified by an officer not below the rank of Assistant Director. Detailed procedure for verification/examination of books shall be circulated separately. The res restri tricti ction on to ins inspect pect/ve /verif rify y the book bookss of acco accounts unts for two yea years rs has enhanced enha nced the rol rolee of the bea beatt of offic ficers ers and the their ir Sup Superv erviso isors rs in mon monito itorin ring g payments of contribution. It is their responsibility to debit employers accounts under “Accrual Accounting System” at the beginning of every month and make adjustments in the prescribed manner as already given in Circular # 15/2003-04.
43 B&C Department and Zonal Offices shall ensure implementation of the system and monitor progress accordingly. accordingly. 7. Amendment in Sub-Section (3) of Section 12
The wo The word rdss “i “in n th thee pr pres escr crib ibed ed ma mann nner er”” ha hass be been en su subs bsti titut tuted ed fo forr th thee wo word rd “pur “p urpo pose se”” to de devi vise se a me mech chan anis ism m in th thee re rele leva vant nt Re Regu gula lati tion on/R /Rul ulee fo for r maintenance of record and returns liable to be submitted to the Institution in this behalf. 8. Amendment in of Section 12A
Section 12A prescribing the manner of the applicability of Self-Assessment Scheme has been omitted. After the omission of clause 2(oa) and Section 12A the operation of Self-Assessment Scheme has been ceased. 9. Amendment in Schedule
The para 2 of the Schedule to the EOB Act 1976 has also been amended. After After this amendment the minimum pension payable to an insured person shall be Rs. 1000/= from 1st January January,, 2005. Through this amendment all those pensioners who are getting pension within the range of Rs. 700/= to Rs. 999/= per month shall now get Rs. 1000/= per month. The change in the rate shall be effective from 1st January 2005. This change chan ge how howeve everr sha shall ll be pro propor portio tionate nately ly appl applied ied on red reduced uced pens pension ion and survivors pension where the pensioner has left behind more than one survivors.
(Kh (K hal alid id
Javed
Chaudhry) DDG(B&C)
