Law:

Section:

(a) West Pakistan Employees' Social Security Ordinance (X of 1965)-----S.2(30)(d)---Constitution of Pakistan (1973), Art.185(3)---Leave to appeal was granted to examine whether the "production bonus" falls within the meaning of "bonus" as defined in S.2(30)(d) of Ordinance X of 1965. (b) West Pakistan Employees' Social Security Ordinance (X of 1965)-- ---S. 2(30)(d)---Constitution of Pakistan (1973), Art.185(3)---Bonus, categories of---"Production bonus" not excluded from definition of "wages"---Two categories of bonus, one dependent on the profitability of the enterprise as such, and the other related to the work, the individual or group effort and related to the wages of workmen---Distinction. The dictionary meaning, the industrial practice and the judicial precedents, all clearly establish the existence of two categories of bonus, the one dependent on the profitability of the enterprise as such and the other related to the work the individual or group effort and related to the wages of the workmen. It is true that the latter is also as its object, the profitability and solvency of the enterprise, but the earning of this bonus is not dependent on it in any manner. The requisite efforts made or target achieved creates the entitlement irrespective of the profitability. The bonus of the first category for that reason has those characteristics which have been culled out from its nature and Content i.e. it is irregular in character, that it does not bear direct nexus with the actual performance of the worker that it is in the nature of reward, gift or a gratuitous payment and the person receiving it has no right to claim it unless profitability requirement is established and justifies it. It is this type of bonus which has been excluded from the definition of wages and not what bears a direct nexus with the performance of the workmen which is certain and definite and is earned by putting in the requisite effort or on achieving the target irrespective of the fact whether the enterprise makes a profit or does not. Pak Cigarettes Labour Union v. Pakistan Tobacco Co. Ltd., Karachi and another P L D 1981 S C 495; Zeal Pak Cement Factory Ltd. v. The Cement Labour…

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