Competition Law and Manufacturing Ecosystem Gatekeeper Power

1.Introduction

A strike is an important instrument of collective labour action through which workers collectively stop or refuse to perform work in order to press their employment-related demands. However, the right to strike is not absolute. Labour legislation establishes procedural and substantive requirements that must be fulfilled before a strike can lawfully commence or continue. Where those requirements are violated, the strike may be declared an illegal strike.

In Pakistan, the principal statutory framework for establishments falling within federal/trans-provincial jurisdiction is contained in the Industrial Relations Act, 2012 (IRA 2012). Sections 42 and 43 provide the basic framework governing lawful and illegal strikes. Section 44 further establishes the procedure for dealing with an illegal strike.

Meaning of Illegal Strike

An illegal strike is a strike which is declared, commenced or continued in circumstances prohibited by the applicable industrial-relations legislation. Illegality generally arises from failure to comply with mandatory procedural requirements, commencement of a strike outside the statutory dispute-resolution mechanism, violation of an order of the competent authority, or continuation of a strike while a settlement or award is legally operative.

Under Section 43 of the Industrial Relations Act, 2012, a strike is illegal in specified circumstances. Therefore, determination of illegality requires examination of the statutory conditions and the factual circumstances surrounding the strike.

Statutory Standards for Determining an Illegal Strike

1. Failure to Give Proper Strike Notice

The first major test is whether the workers have given the employer the required notice of strike in the prescribed manner.

Section 43(1)(a) provides that a strike is illegal where it is declared, commenced or continued:

without giving the required notice;

before the date specified in the notice; or

in contravention of the statutory restrictions applicable to strikes.

Thus, compliance with the notice requirement is an essential procedural safeguard.

2. Strike Commenced Before the Permitted Date

Even where a valid strike notice has been given, workers cannot ordinarily commence the strike earlier than the date specified in the notice. A premature strike can therefore become illegal.

The purpose of this requirement is to provide the employer and the relevant labour authorities an opportunity to participate in conciliation or other dispute-resolution processes before industrial action begins.

3. Dispute Must Be Raised Through the Prescribed Procedure

Section 43(1)(b) makes a strike illegal if it is declared, commenced or continued in consequence of an industrial dispute that was raised in a manner other than that provided by the Act.

Accordingly, the legality of a strike is connected not only with the conduct of workers on the day of the strike but also with the legal origin and procedural history of the industrial dispute.

The Supreme Court of Pakistan has examined the statutory concept of an industrial dispute under the Industrial Relations Act, 2012 and explained that the 2012 Act adopted a broader definition than the earlier Industrial Relations Ordinance, 1969. The Court emphasized that the dispute must nevertheless satisfy the statutory requirements, including those relating to Section 34. 2024 SCMR 719 is therefore relevant when examining whether the underlying dispute falls within the statutory industrial-relations framework.

4. Violation of an Order Prohibiting or Restricting the Strike

A strike may also become illegal if it is continued in violation of an order made under the Act.

Section 43(1)(c) expressly covers continuation of a strike in contravention of orders made under the relevant provisions of the Act, including Section 42 and other specified provisions.

Section 42 permits intervention where a strike or lock-out is continuing and provides mechanisms for governmental prohibition and reference of the dispute to the Commission in circumstances specified by law.

5. Strike During the Operation of a Settlement or Award

Another important standard is the existence of a valid settlement or award.

Under Section 43(1)(d), a strike is illegal if it is declared, commenced or continued during the period in which a settlement or award is in operation concerning any matter covered by that settlement or award.

This rule promotes industrial stability and prevents parties from using strikes to reopen matters that are already legally settled or adjudicated.

6. Evidence and Factual Determination

Illegality cannot simply be assumed from an employer's allegation that workers have stopped work. The competent authority must examine the relevant circumstances and evidence.

Relevant evidence may include:

the strike notice;

date and mode of service of notice;

collective bargaining agent's records;

correspondence between the employer and workers;

conciliation proceedings;

orders of the Commission or other competent authority;

existing settlements or awards;

attendance and workplace records; and

evidence concerning commencement and continuation of the strike.

The statutory procedure under Section 44 allows an authorized officer to investigate an alleged illegal strike and obtain evidence from the establishment and relevant persons.

Procedure for Determination of Illegal Strike

Section 44 establishes a specific procedure.

An officer of the Commission, not below the rank of Deputy Registrar, may be assigned the duty of conducting an inquiry into an alleged illegal strike. The officer may enter the establishment, inspect relevant premises and records, obtain evidence and require parties to appear.

After receiving the inquiry report, the Commission gives notice to the employer and the collective bargaining agent or registered trade union concerned. The parties are provided an opportunity of being heard.

The Commission may thereafter order the strike to be called off. The Act also provides consequences where workers or employers disobey such orders.

Case Law

1. 2024 SCMR 719 — Supreme Court of Pakistan

In 2024 SCMR 719, the Supreme Court considered the scope of an industrial dispute under the Industrial Relations Act, 2012. The Court contrasted the definition under the earlier Industrial Relations Ordinance, 1969 with that under the 2012 Act and observed that the 2012 legislation does not contain the same exclusion concerning enforcement of rights under other laws.

The case is significant for illegal-strike analysis because a lawful strike must arise from an industrial dispute falling within the statutory framework. Therefore, determining the legal character of the underlying dispute is an important preliminary question.

2. Manager, Karim Jute Mills Ltd. v. Delhi Muslim Hotel Karmachari Union, 1971 PLC 17

In Manager, Karim Jute Mills Ltd. v. Delhi Muslim Hotel Karmachari Union, the labour adjudicatory forum considered the issue of strike notice under the Industrial Relations Ordinance, 1969.

The case demonstrates that the question of illegality may depend upon the actual circumstances surrounding service of the strike notice. The forum held, in the circumstances before it, that the employer could not successfully rely upon non-receipt of notice where the workers had attempted service and the notice was subsequently received.

The case illustrates an important principle: technical allegations concerning notice must be examined in light of the actual facts and statutory requirements rather than determined mechanically.

3. Sindh High Court — Constitutional Petition concerning NIRC proceedings

In a matter concerning proceedings before the National Industrial Relations Commission, the Sindh High Court dealt with observations regarding the legality of a charter of demands and strike proceedings initiated by a locally registered trade union. The Court upheld the Full Bench order while directing that the matter be decided afresh after recording evidence and without being influenced by the earlier observations.

This illustrates that where the legality of industrial action depends upon disputed factual or jurisdictional questions, the competent forum should determine those issues after giving the parties an opportunity to produce evidence.

Important Principles

The following principles may therefore be used as the main standards for determining an illegal strike:

Existence of an industrial dispute must be established.

Statutory procedure for raising the dispute must have been followed.

Required strike notice must have been properly given.

The strike must not begin before the date specified in the notice.

Workers must comply with applicable conciliation and dispute-resolution requirements.

A strike must not continue in violation of a lawful order of the competent authority.

A strike cannot lawfully be used to reopen matters covered by an operative settlement or award.

The competent authority should examine the evidence and circumstances before determining illegality.

Parties must ordinarily receive an opportunity of being heard.

The legal consequences of an illegal strike must be determined according to the applicable statutory provisions.

Consequences of an Illegal Strike

An illegal strike can expose participating workers and, depending upon the circumstances, the concerned trade union to statutory consequences.

Under Section 44, if workers contravene an order of the Commission requiring the strike to be called off, the Commission may pass orders concerning dismissal of striking workers after the prescribed inquiry. Where a registered trade union is found to have committed or abetted such contravention, the Act also provides serious consequences concerning its registration and office-bearers.

Therefore, the determination that a strike is illegal is not merely a technical declaration. It can have significant consequences for workers, trade unions and industrial relations.

Conclusion

Illegal strike determination under Pakistani labour law primarily depends upon compliance with the statutory requirements governing industrial disputes and strikes. The most important standards concern proper strike notice, lawful commencement, proper raising of the industrial dispute, compliance with orders of the competent authority, and respect for operative settlements or awards.

Section 43 of the Industrial Relations Act, 2012 provides the substantive grounds of illegality, while Section 44 establishes the inquiry and adjudicatory mechanism. The courts and labour forums have emphasized that questions concerning the legality of industrial action should be determined by examining the applicable statutory provisions together with the evidence and circumstances of the particular dispute.

Thus, a strike should not be treated as illegal merely because an employer characterizes it as unlawful; its legality must be determined by applying the statutory tests and the relevant facts before the competent labour forum.