The Companies' Profits (Workers' Participation) Act, 1968

Updated: Saturday August 28, 2021/AsSabt Muharram 20, 1443/Sanivara Bhadra 06, 1943, at 02:17:55 PM

The Companies’ Profits’ (Workers’ Participation) Act, 1968

(Act No. XII of 1968)

[Assented: 4th July, 1968]

An Act to provide for participation of workers in the profits of companies

Whereas it is expedient to provide for participation of workers in the profits of companies and for matters ancillary thereto;

[1][And whereas the national interest of Pakistan in relation to the achievement of uniformity within the meaning of clause (2) of Article 131 of the Constitution requires Central legislation in the matter;]

It is hereby enacted as follows;---

1. Short title, extent, application and commencement.---(1) This Act may be called the Companies’ Profits (Workers’ Participation) Act, 1968.

(2) It extends to the whole of [2][the Punjab].

(3) It shall come into force at once.

2. Definitions.---In this Act, unless there is anything repugnant in the subject or context,---

(a) “Board” in relation to a Fund means a Board of Trustees constituted under section 4 for the management and administration of the Fund;

(b) “company” means a company within the meaning of [3][Companies Act, 2017 (XIX of 2017)], and includes,---

(i) a body corporate established by or under any law for the time being in force;

(ii) any institution, organization or association whether incorporated or not, declared by the [4][Federal] Government in the official Gazette to be a company for the purposes of this Act;

[5][(bb) “committee” means the Punjab Companies’ Profit Workers’ Participation Committee constituted under the Act;]

[6][(cc) “Government” means Government of the Punjab;]

(d) [7][“profits” in relation to a company means such net profits as are attributable to its business, trade, undertaking or other operations in Pakistan;]

(dd) “rules” means rules made under this Act;

(e) “scheme” means the scheme set out in the schedule;

(f) [8][“worker” in relation to a company means an employee of the company including an employee hired by the company itself or through a contractor and who is a worker in terms of clause (xxxi) of section 2 of the Punjab Industrial Relations Act, 2010 (XIX of 2010) and has been working for or in the company for a period of not less than six months.]

3. Establishment of Fund.---(1) Every company to which the scheme applies shall,---

(a) establish a Workers’ Participation Fund in accordance with the scheme as soon as the accounts for the year in which the scheme becomes applicable to it are finalised, but not later than nine months after the close of that year;

(b) [9][subject to adjustments, if any, pay every year to the Fund not later than nine months after the close of that year five percent of its profits during such year; and]

(c) furnish to the [10][Federal] Government and the Board, not later than nine months after the close of every year of account, its audited accounts for that year, duly signed by its auditors.

(2) The amount paid to the Fund under clause (b) of sub-section (1) in relation to a year shall be deemed to have been allocated to the Fund on the first day of the year next succeeding that year.

4. Management of the Fund.---(1) As soon as may be but not later than two months, after the establishment by a company of a Fund under section 3, there shall be constituted a Board of Trustees consisting of the following trustees, namely:---

(a) two persons elected by the workers of the company from amongst themselves; and

(b) two persons nominated by the management of the company of whom at least one shall be a person from the accounts branch of the company.

(2) The persons holding office as trustees shall elect for one year a person to be the Chairman of the Board alternatively from amongst the trustees elected under clause (a) of sub-section (1) and those nominated under clause (b) of that sub-section, the first Chairman being from amongst the latter.

(3) A trustee shall, unless he sooner ceases to represent the interest he was elected or nominated to represent, hold office for such term and on such conditions as may be prescribed by rules.

(4) All decisions of the Board shall be expressed in terms of the opinion of the majority of the trustees and, in the event of the trustee being equally divided in their opinions, the Chairman shall have and exercise a second or casting vote.

(5) The Board shall manage and administer the Fund in accordance with the provisions of this Act, the scheme and any rules made in this behalf.

(6) The Board shall, in the exercise of its powers and performance of its functions under this Act, be subject to such directions as the [11][Federal] Government may, from time to time, give.

(7) The [12][Federal] Government if it is of opinion that a trustee or a Board has been persistently failing in the performance of his or its functions or has generally been acting in a manner inconsistent with the objects and interests of the Fund, may, after giving such trustee or, as the case may be, the Board, an opportunity of showing cause against it, by order,---

(a) remove such trustee from his office or direct that the Board shall stand superseded for such period as may be specified in the order; and

(b) direct that, pending the election or nomination of a person in place of the trustee removed from office or, as the case may be, the re-constitution of the Board, the powers and functions of the trustee so removed or the Board shall be exercised and performed by a person specified in the order.

(8) A casual vacancy in the office of a trustee shall be filled as soon as may be by the election or, as the case may be, nomination of another person and the person elected or nominated to fill such vacancy shall hold office for the unexpired term of his predecessor.

(9) Upon the suppression of a Board under sub-section (7), the trustees in that Board shall cease to hold office and references to the Board in this Act, the scheme and the rules shall be construed as references to the officer specified in the order under that sub-section.

(10) Before the expiry of the period of suppression, the Board shall be re-constituted in accordance with the provisions of this Act so as to enable it to take over its functions upon the expiry of such period.

(11) No act or proceeding of the Board shall be invalid or questioned merely on the ground of the existence of a vacancy in, or defect in the constitution of the Board.

[13][4-A. The Committee.---(1) The Government shall, by notification, constitute a committee to be called “Punjab Companies’ Profits Workers’ Participation Committee” to monitor the implementation of the Act and the scheme thereunder and to advise the Government for appropriate administrative, legislative and other measures to accomplish the objectives of the Act.

(2) The Committee shall consist of the Chairperson and not more than eight members, representing the Government, the companies and the workers.

(3) The Committee may call for such record or information from a company or the Board as may be prescribed or as may be required by the Company for purposes of the implementation of the provisions of the Act.

(4) The company or, as the case may be, the Board shall furnish such record or information, within such time, as the committee be specify.]

5. Penalty.---[14][(1) Where the company fails to comply with the provisions of the Act or the scheme, every director, manager or other officer responsible for the management of the affairs of the company, shall be liable to the administrative penalty, not exceeding fifty thousand rupees, in the manner prescribed; but, in case of continuing failure, shall be liable to additional administrative penalty, not exceeding ten thousand rupees, for every day after the first day during which the failure continues.]

(2) [15][Where a company fails to comply with the orders of the committee under subsection (3) of section 4A, every director, manager or other officer responsible for the management of the affairs of the company, shall be liable to the administrative penalty, not exceeding one hundred thousand rupees, in the manner prescribed; but, in case of continuing failure, shall be liable to additional administrative penalty, not exceeding twenty thousand rupees, for every day after the first day during which the failure continues.]

(3) A penalty imposed by an order under sub-section (1) shall, if it is not paid within the time specified in the order, recoverable as an arrear of land revenue.

(4) The [16][Federal] Government may, upon an application made in this behalf by any person aggrieved by an order made under sub-section (1) [* * *] within a period of six months from the date of the order, review the order and may, upon such review, pass such orders as it may think fit.

(5) [17][Notwithstanding anything contained in this Act or the scheme, if a defaulting company complies with the provisions of section 3 and distributes the benefits in accordance with paragraph 4 of the scheme for the period of default on or before the date fixed by the Government, no such penalty shall be levied and the company shall not be liable to pay interest as provided in paragraph 2 of the scheme.]

6. Power to call for information.---The [18][Federal] Government may at any time, call upon a company or a Board to furnish it with such information and documents, including records of the proceedings of the company or the Board, as may be relevant or useful for the purposes of, or necessary for ensuring proper compliance with, the provisions of this Act, the rules and the scheme.

7. Settlement of disputes etc.---(1) Any difference arising between the Board and the company relating to the administration of the scheme shall be reported to the [19][Federal] Government whose decision thereon shall be final.

(2) All claims of a worker relating to the benefits of the scheme, whether against the Board or the company, shall be settled in the same manner as it provided for in the Payment of Wages Act, 1936, for the settlement of claims arising out of deductions from wages.

8. Delegation of power.---The [20][Federal] Government may, by notification in the official Gazette, direct that all or any of its powers or functions under this Act may, subject to such limitations, restrictions or conditions, if any, as may be specified in the notification, be exercised or performed also by any officer subordinate to it or by any authority so specified.

[21][8-A. Power to amend the Schedule.---The Government may, by notification in the official Gazette, amend the Schedule.]

9. Power to make rules.---The [22][Federal] Government may make rules to carry out the purposes of this Act.

10. Act to over ride other laws.---The provisions of this Act shall have effect notwithstanding anything contained in any other law for the time being in force, or in any contract or the memorandum or articles of association of a company.

-----------------------------

COMPANIES PROFITS (WORKERS' PARTICIPATION)

(AMENDMENT) ORDINANCE, 2002

ORDINANCE LXIX OF 2002

An Ordinance further to amend the Companies Profits (Workers' Participation) Act, 1968

[Gazette of Pakistan, Extraordinary, Part-I 9th October. 2002]

F. No.2(1)/2042‑Pub. dated 9‑10‑2002.-----The following Ordinance promulgated by the President is hereby published for general information:‑‑

2. Amendment of Schedule, Act XII of 1968,‑‑In the Companies Profits (Workers' Participation) Act, 1968 (XII of 1968), in the Schedule, in Paragraph 4, in clause (a), under the heading "Categories".

(a) in the entry of serial number 1 , for the word "two", Occurring for the second time, the word "five" shall be substituted: and

(b) in the entry at serial number 2, for the word "two" occurring for the second time, the word "five" shall be substituted.

-----------------------------

ORDINANCE VII OF 2018

COMPANIES PROFITS (WORKERS' PARTICIPATION) (AMENDMENT) ORDINANCE, 2018

An Ordinance to amend the Companies Profits

(Workers' Participation) Act, 1968

[Gazette of Punjab Extraordinary,

1st June, 2018]

No. Legis:13-77/2010(C)(P-I), dated 1.6.2018.---The following Ordinance promulgated by Governor of the Punjab is hereby published for general information:

It is necessary further to amend the Companies Profits (Workers' Participation) Act, 1968 (XII of 1968) pursuant to the Constitution (Eighteenth Amendment) Act, 2010 and to update the law for purposes hereinafter appearing.

Provincial Assembly of the Punjab is not in session and Governor of the Punjab is satisfied that circumstances exist which render it necessary to take immediate action.

In exercise of the powers conferred under clause (1) of Article 128 of Constitution of the Islamic Republic of Pakistan, Governor of the Punjab is pleased to make and promulgate the following Ordinance:

1. Short title and commencement.---(1) This Ordinance may be cited as the Companies Profits (Workers' Participation) (Amendment) Ordinance, 2018.

(2) It shall come into force at once.

2. Amendment in the Preamble of Act XII of 1968.---In the Companies Profits (Workers' Participation) Act, 1968 (XII of 1968), hereinafter referred to as the Act, in the Preamble, the second paragraph shall be omitted.

3. Amendment in Act XII of 1968.---In the Act:

(a) in section 2, section 3, section 4, section 5, section 6, section 7, section 8 and section 9, for the words "Federal Government", wherever occur, the word "Government" shall be substituted; and

(b) in the Schedule, for the words "Federal Government", wherever occur, the word "Government" shall be substituted.

4. Amendment in section 1 of Act XII of 1968.---In the Act, in section 1, in subsection (2), for the word "Pakistan", the words "the Punjab" shall be substituted.

5. Amendment in section 2 of Act XII of 1968.---In the Act, in section 2:

(a) in clause (b), for the expression "Companies Ordinance of 1984 (XLVII of 1984), the expression "Companies Act 2017 (XIX of 2017)" shall be substituted;

(b) after clause (b), the following new clause (bb) shall be inserted:

"(bb) "committee" means the Punjab Companies' Profits Workers' Participation Committee constituted under the Act;";

"(cc) "Government" means Government of the Punjab;";

(d) for clause (d), the following shall be substituted:

"(d) "profits" in relation to a company means such net profits as are attributable to its business, trade, undertaking or other operations in Pakistan;"; and

(e) for clause (f), the following shall be substituted:

"(f) "worker" in relation to a company means an employee of the company including an employee hired by the company itself or through a contractor and who is a worker in terms of clause (xxxi) of section 2 of the Punjab Industrial Relations Act 2010 (XIX of 2010) and has been working for or in the company for a period of not less than six months.".

6. Amendment in section 3 of Act XII of 1968.---In the Act, in section 3, in subsection (1), for clause (b), the following shall be substituted:

"(b) subject to adjustments, if any, pay every year to the Fund not later than nine months after the close of that year five percent of its profits during such year; and".

7. Insertion of section 4-A in Act XII of 1968.---In the Act, after section 4, the following new section 4-A shall be inserted:

"4-A. The Committee.---(1) The Government shall, by notification, constitute a committee to be called "Punjab Companies' Profits Workers' Participation Committee" to monitor the implementation of the Act and the scheme thereunder and to advise the Government for appropriate administrative, legislative and other measures to accomplish the objectives of the Act.

(2) The Committee shall consist of the Chairperson and not more than eight members, representing the Government, the companies and the workers.

(4) The company or, as the case may be, the Board shall furnish such record or information, within such time, as the committee be specify.".

8. Amendment in section 5 of Act XII of 1968.---In the Act, in section 5:

(a) for subsection (1), the following shall be substituted:

"(1) Where the company fails to comply with the provisions of the Act or the scheme, every director, manager or other officer responsible for the management of the affairs of the company, shall be liable to the administrative penalty, not exceeding fifty thousand rupees, in the manner prescribed; but, in case of continuing failure, shall be liable to additional administrative penalty, not exceeding ten thousand rupees, for every day after the first day during which the failure continues.";

(b) after subsection (1), the following subsection (2) shall be inserted:

"(2) Where a company fails to comply with the orders of the committee under subsection (3) of section 4A, every director, manager or other officer responsible for the management of the affairs of the company, shall be liable to the administrative penalty, not exceeding one hundred thousand rupees, in the manner prescribed; but, in case of continuing failure, shall be liable to additional administrative penalty, not exceeding twenty thousand rupees, for every day after the first day during which the failure continues."; and

"(5) Notwithstanding anything contained in this Act or the scheme, if a defaulting company complies with the provisions of section 3 and distributes the benefits in accordance with paragraph 4 of the scheme for the period of default on or before the date fixed by the Government, no such penalty shall be levied and the company shall not be liable to pay interest as provided in paragraph 2 of the scheme.".

9. Insertion of section 8A in Act XII of 1968.---In the Act, after sections 8, the following new section 8A shall be inserted:

"8A. Power to amend the Schedule.---The Government may, by notification in the official Gazette, amend the Schedule.".

10. Amendment in the Schedule of Act XII of 1968.---In the Act, in the Schedule:

(a) in paragraph 1:

(i) in clause (iii), for the full stop at the end, a colon shall be substituted and thereafter the following proviso shall be inserted:

"Provided that for a company established on or after first day of July 2018:

(a) clause (ii) shall have effect as if for the expression "Rs. 20 lacs", the expression "five million rupees" were substituted; and

(b) clause (iii) shall have effect as if for the expression "Rs. 40 lacs", the expression "twenty million rupees" were substituted."; and

(ii) under the heading "Explanation", in clause (a), sub-clause (ii) shall be omitted;

(b) 'in paragraph 4, in sub-paragraph (a), under the heading "CATEGORIES", for the existing entries, the following shall be substituted:

"1. Workers drawing average monthly wages not less than the minimum wages for unskilled workers prescribed, from time to time, by the Government.

2. Workers drawing average monthly wages exceeding the minimum wages for unskilled workers prescribed, from time to time, by the Government but not exceeding twenty two thousand rupees.

3. Workers drawing average monthly wages exceeding twenty two thousand rupees.";

"(d) Notwithstanding anything contained in this scheme, no worker shall, in any one year, be entitled out of the annual allocation of units exceeding the amount of four times the minimum wages for unskilled workers as given in the Schedule of the Punjab Minimum Wages for Unskilled Workers Ordinance, 1969 (XX of 1969) in value in so far as such allocation is relatable to clause (b) of subsection (1) of section (3).";

(d) paragraph 8 shall be omitted; and

(e) for paragraph 9, the following shall be substituted:

"(9) The Government may approach the Federal Government for exemption of the income tax on the income of the Fund including capital gains.".

The Companies’ Profits’ (Workers Participation) Act, 1968

(XII of 1968)

CONTENTS

1. Short title, extent and commencement

2. Definitions

3. Establishment of Fund

4. Management of the Fund

5. Penalty

6. Power to call for information

7. Settlement of disputes, etc

8. Delegation of power

9. Power to make rules

10. Act to override other laws

The Schedule Scheme

1. Scope of the scheme

2. Investment of Fund

3. Eligibility to benefits of scheme

4. Distribution of benefits to workers

5. Disbursement of benefits

6. Definition of the net asset value of the unit

7. Employees' own contribution

8. Fiscal concession to the Companies

9. Tax treatment of the income of the Fund

10. Tax treatment of the income to the workers

11. Working and location of the Board of Trustees

12. Audit of the Fund accounts

13. Scheme’s benefits to be in addition to the other benefits

14. Special provision for industries working seasonally

15. Companies engaged in more than one industrial undertakings

16. Entrustment of management of Fund to Investment Corporation of

Pakistan, etc

TEXT

THE COMPANIES PROFITS (WORKERS PARTICIPATION) ACT, 1968

(XII of 1968)

[5th July 1968]

Act

to provide for participation of workers in the profits of companies

WHEREAS it is expedient to provide for participation of workers in the profits of companies and for matters ancillary thereto;

2[*****]

It is hereby enacted as follows:–

1. Short title, extent and commencement.– (1) This Act may be called the

Companies Profits (Workers Participation) Act, 1968.

(2) It extends to the whole of 3[the Punjab].

(3) It shall come into force at once.

2. Definitions.– In this Act, unless there is anything repugnant in the subject or context,–

(a) "Board" in relation to a Fund means a Board of Trustees constituted under section 4 for the management and administration of the Fund;

(b) "company'' means a company within the meaning of 4[The Companies Act, 2017 (XIX of 2017)], and includes–

(i) a body corporate established by or under any law for the time being in force;

(ii) any institution, organization or association whether incorporated or not, declared5 by the 6[Government] in the official Gazette to

1This Act received the assent of the President on 4 July 1968 and was published in the Gazette of Pakistan (Extraordinary),

dated: 5 July 1968, pp. 739-745.

Omitted by the Companies Profits (Workers’ Participation) (Amendment) Ordinance 2020 (XVII of 2020), published in the Punjab Gazette (Extraordinary), dated: 02 December 2020, pp,3839-3845 s.2

Substituted by the Companies Profits (Workers’ Participation) (Amendment) Ordinance 2020 (XVII of 2020), published in the Punjab Gazette (Extraordinary), dated: 02 December 2020, pp,3839-3845 s.4

Substituted by the Companies Profits (Workers’ Participation) (Amendment) Ordinance 2020 (XVII of 2020), published in the Punjab Gazette (Extraordinary), dated: 02 December 2020, pp,3839-3845 s.5

5The Federal Government declared each of the following to be a company for the purposes of the Act, namely:–

(i) Any Companies incorporated, registered or established outside Pakistan which is engaged in industrial undertaking in Pakistan.

(ii) Any partnership, association of persons (including consortium, syndicate or joint venture) or proprietorship which is engaged in an industrial undertaking in Pakistan.

(iii) Any industrial undertaking which is set up as a department activity of, the Federal or Provincial Government of a body corporate established under any law for the time being in force. See Gazette of Pakistan (Extraordinary), dated: 31 July 1968.

be a company for the purpose of this Act;

7[(bb) “committee” means the Punjab Companies’ Profit Workers’ participation Committee constituted under the Act;]

8[(cc) “Government” means Government of the Punjab;]

(d) 9["profits" in relation to a company means such net profits as are attributable to its business, trade, undertaking or other operations in Pakistan;]

10[(dd) "rules" means rules made under this Act;]

(e) "scheme" means the scheme set out in the Schedule;

(f) 11[“worker” in relation to a company means an employee of the company including an employee hired by the company itself or through a contractor and who is a worker in terms of clause (xxxi) of section 2 of the Punjab Industrial Relations Act 2010 (XIX of 2010) and has been working for or in the company for a period of not less than six months.]

12[3. Establishment of Fund.– (1) Every company to which the scheme applies shall–

(a) establish a Workers Participation Fund in accordance with the scheme as soon as the accounts for the year in which the scheme becomes applicable to it are finalised, but not later than nine months after the close of that year; 13[*]

14[(b) subject to adjustments, if any, pay every year to the Fund not later than nine months after the close of that year five percent of its profits during such year and the Government may, for sufficient reasons, extend such time period for one month; and]

6Substituted by the Companies Profits (Workers’ Participation) (Amendment) Ordinance 2020 (XVII of 2020), published in the Punjab Gazette (Extraordinary), dated: 02 December 2020, pp,3839-3845 s.3

7 Inserted by the Companies Profits (Workers’ Participation) (Amendment) Ordinance 2020 (XVII of 2020), published in the Punjab Gazette (Extraordinary), dated: 02 December 2020, pp,3839-3845 s.5

8 Inserted by the Companies Profits (Workers’ Participation) (Amendment) Ordinance 2020 (XVII of 2020), published in the Punjab Gazette (Extraordinary), dated: 02 December 2020, pp,3839-3845 s.5

9 Substituted by the Companies Profits (Workers’ Participation) (Amendment) Ordinance 2020 (XVII of 2020), published in the Punjab Gazette (Extraordinary), dated: 02 December 2020, pp,3839-3845 s.5

10Inserted by the Companies Profits (Workers Participation) (Amendment) Ordinance, 1970 (XII of 1970), published in the

Gazette of Pakistan (Extraordinary), dated: 1 July 1970, s. 2.

11 Substituted by the Companies Profits (Workers’ Participation) (Amendment) Ordinance 2020 (XVII of 2020), published in the Punjab Gazette (Extraordinary), dated: 02 December 2020, pp,3839-3845 s.5

12Substituted by the Companies Profits (Workers Participation) (Amendment) Ordinance, 1970 (XII of 1970), published in the Gazette of Pakistan (Extraordinary), dated: 1 July 1970, s. 3.

13The word “and” was omitted by the Labour Laws (Amendment) Act, 1977 (XVII of 1977); assented to by the President on 5 May 1977, and was published in the Gazette of Pakistan (Extraordinary), dated: 9 May 1977, pp. 238-244, s. 2 read with the First Schedule.

14Substituted by the Companies Profits (Workers’ Participation) (Amendment) Ordinance 2020 (XVII of 2020), published in the Punjab Gazette (Extraordinary), dated: 02 December 2020, pp,3839-3845 s.6

(c) furnish to the 15[Government] and the Board, not later than nine months after the close of every year of account, its audited accounts for that year, duly signed by its auditors.]

(2) The amount paid to the Fund under clause (b) of subsection (1) in relation to a year shall be deemed to have been allocated to the Fund on the first day of the year next succeeding that year.

4. Management of the Fund.– (1) As soon as may be 16[but not later than two months] after the establishment by a company of a Fund under section 3, there shall be constituted a Board of Trustees consisting of the following trustees, namely:-

(a) two persons elected by the workers of the company from amongst themselves; and

(b) two persons nominated by the management of the company of whom at least one shall be a person from the accounts branch of the company.

(2) The persons holding office as trustees shall elect for one year a person to be the Chairman of the Board alternately from amongst the trustees elected under clause (a) of subsection (1) and those nominated under clause (b) of that subsection, the first Chairman being from amongst the latter.

(3) A trustee shall, unless he sooner ceases to represent the interest he was elected or nominated to represent, hold office for such term and on such conditions as may be prescribed by rules.

(4) All decisions of the Board shall be expressed in terms of the opinion of the majority of the trustees and, in the event of the trustees being equally divided in their opinions, the Chairman shall have and exercise a second or casting vote.

(5) The Board shall manage and administer the Fund in accordance with the provisions of this Act, the scheme and any rules made in this behalf.

(6) The Board shall, in the exercise of its powers and performance of its functions under this Act, be subject to such directions as the 17[Government] may, from time to time, give.

(7) The 18[Government], if it is of opinion that a trustee or a Board has been persistently failing in the performance of his or its functions or has generally been acting in a manner inconsistent with the objects and interests of the Fund, may, after giving such trustee or, as the case may be, the Board, an opportunity of showing cause against it by order,–

(a) remove such trustee from his office or direct that the Board shall stand superseded for such period as may be specified in the order; and

(b) direct that, pending the election or nomination of a person in place of

15 Substituted by the Companies Profits (Workers’ Participation) (Amendment) Ordinance 2020 (XVII of 2020), published in the Punjab Gazette (Extraordinary), dated: 02 December 2020, pp,3839-3845 s.3 16Inserted ibid.

17Substituted by the Companies Profits (Workers’ Participation) (Amendment) Ordinance 2020 (XVII of 2020), published in the Punjab Gazette (Extraordinary), dated: 02 December 2020, pp,3839-3845 s.3 18Substituted by the Companies Profits (Workers’ Participation) (Amendment) Ordinance 2020 (XVII of 2020), published in the Punjab Gazette (Extraordinary), dated: 02 December 2020, pp,3839-3845 s.3

the trustee removed from office or, as the case may be, the reconstitution of the Board, the powers and functions of the trustee so removed or the Board shall be exercised and performed by a person specified in the order.

(9) Upon the supersession of a Board under subsection (7), the trustees in that Board shall cease to hold office and references to the Board in this Act, the scheme and the rules shall be construed as references to the officer specified in the order under that subsection.

(10) Before the expiry of the period of supersession, the Board shall be reconstituted in accordance with the provisions of this Act so as to enable it to take over its functions upon the expiry of such period.

(11) No act or proceeding of the Board shall be invalid or questioned merely on the ground of the existence of a vacancy in, or defect in the constitution of, the Board.]

19[4-A. The Committee.– (1) The Government shall, by notification, constitute a Committee to be called Punjab Companies’ Profits Workers’ Participation Committee to monitor the implementation of the Act and the scheme thereunder and to advise the Government on appropriate administrative, legislative and other measures essential to a achieve the objectives of the Act.

(2) The Committee shall consist of the Chairperson and not more than eight members, representing the Government, the companies and the workers.

(3) The Committee may call for such record or information as may be required for purposes of the implementation of the provisions of the Act or as may be prescribed.

(4) The company or, as the case may be, the Board shall furnish such record or information, within such time, as the Committee may specify.]

5. Penalty.– 20[(1) Where the company to which the scheme applies fails to comply with the provisions of the Act or the scheme, every director, manager or other officer responsible for the management of the affairs of the company, shall be liable to the administrative penalty, not exceeding fifty thousand rupees, in the manner prescribed; but, in case of continuing failure, shall be liable to additional administrative penalty, not exceeding ten thousand rupees, for every day after the first day during which the failure continues.]

21[(2) Where a company to which the scheme applies fails to comply with the orders of the committee under subsection (3) of section 4A, every director, manager

19 Inserted by the Companies Profits (Workers’ Participation) (Amendment) Ordinance 2020 (XVII of 2020), published in the Punjab Gazette (Extraordinary), dated:02 December, pp,3839-3845 s.7

20Substituted by the Companies Profits (Workers’ Participation) (Amendment) Ordinance 2020 (XVII of 2020), published in the Punjab Gazette (Extraordinary), dated: 02 December 2020, pp,3839-3845 s.8

21Inserted by the Companies Profits (Workers’ Participation) (Amendment) Ordinance 2020 (XVII of 2020), published in the Punjab Gazette (Extraordinary), dated: 02 December 2020, pp,3839-3845 s.8

or other officer responsible for the management of the affairs of the company, shall be liable to the administrative penalty, not exceeding one hundred thousand rupees, in the manner prescribed; but, in case of continuing failure, shall be liable to additional administrative penalty, not exceeding twenty thousand rupees, for every day after the first day during which the failure continues.”; and]

(3) A penalty imposed by an order under sub-section 22[(1)] shall, if it is not paid within the time specified in the order, be recoverable as an arrear of land revenue.

(4) The 23[Government] may, upon an application made in this behalf by any person aggrieved by an order made under sub-section (1) 24[* * *] within a period of six months from the date of the order, review the order and may upon such review, pass such order as it may think fit.

25[(5) The outstanding amounts of five percent of the profits and penalty imposed by an order under subsection (1) shall, if it is not paid accordingly within the time specified in the order, be recoverable as arrears of land revenue under the Land Revenue Act, 1967 (XVII of 1967) and be deposited in the Fund.

6. Notwithstanding anything contained in this Act or the scheme, if a defaulting company complies with the provisions of section 3 and distributes the benefits in accordance with paragraph 4 of the scheme for the period of default on or before the date fixed by the Government, no such penalty shall be levied and the company shall not be liable to pay interest as provided in paragraph 2 of the scheme.]

26[6. Power to call for information.– The 27[Government] may, at any time, call upon a company or a Board to furnish it with such information and documents, including the records of the proceedings of the company or the Board, as may be relevant or useful for the purposes of, or necessary for ensuring proper compliance with, the provisions of this Act, the rules and the scheme.

7. Settlement of disputes, etc.– (1) Any difference arising between the Board and the company relating to the administration of the scheme shall be reported to the 28[Government] whose decision thereon shall be final.

(2) All claims of a worker relating to the benefits of the scheme, whether against the Board or the company, shall be settled in the same manner as is provided for in the Payment of Wages Act, 1936 (IV of 1936), for the settlement of

22Substituted ibid., for the brackets and figure “(2)”.

23Substituted by the Companies Profits (Workers’ Participation) (Amendment) Ordinance 2020 (XVII of 2020), published in the Punjab Gazette (Extraordinary), dated: 02 December 2020, pp,3839-3845 s.3

24The words, brackets and figure “or sub-section (2)” were omitted by the Labour Laws (Amendment) Act, 1977 (XVII of 1977);

assented to by the President on 5 May 1977, and was published in the Gazette of Pakistan (Extraordinary), dated: 9 May 1977, pp. 238-244, s. 2 read with the First Schedule.

25 Inserted by the Companies Profits (Workers’ Participation) (Amendment) Ordinance 2020 (XVII of 2020), published in the Punjab Gazette (Extraordinary), dated: 02 December 2020, pp,3839-3845 s.8 26Substituted by the Companies Profits (Workers Participation) (Amendment) Ordinance, 1970 (XII of 1970), published in the Gazette of Pakistan (Extraordinary), dated: 1 July 1970, s. 4.

27Substituted by the Companies Profits (Workers’ Participation) (Amendment) Ordinance 2020 (XVII of 2020), published in the Punjab Gazette (Extraordinary), dated: 02 December 2020, pp,3839-3845 s.3

28Substituted by the Companies Profits (Workers’ Participation) (Amendment) Ordinance 2020 (XVII of 2020), published in the Punjab Gazette (Extraordinary), dated: 02 December 2020, pp,3839-3845 s.3

claims arising out of deductions from wages.

8. Delegation of power.– The 29[Government] may, by notification in the official Gazette, direct that all or any of its powers or functions under this Act may, subject to such limitations, restrictions or conditions, if any, as may be specified in the notification, be exercised or performed also by any officer subordinate to it or by any authority so specified.

30[8A. Inspectors.- (1) The Government may, by notification in the official Gazette, appoint such persons, in such manner, as may be prescribed, to be the Inspectors for the purposes of this Act within such local limits as it may assign to them respectively.

(2) No person shall be appointed to be an Inspector under subsection (1) or have been so appointed, continue to hold office, who is or becomes directly or indirectly interested in a company or in an industrial undertaking, process or business carried on by it.

(3) Every Inspector shall be deemed to be a public servant within the meaning of section 21 of the Pakistan Penal Code (XLV of 1860) and shall be responsible to the Committee.

8B. Powers of Inspector.- (1) Subject to any rules made by the Government in this behalf, an Inspector, within the local limits of his jurisdiction shall have the powers to:---

(a) enter into any place which is or which he has reason to believe to be, used as an industrial undertaking or capable of being declared to be an industrial undertaking or company under the provisions of this Act;

(b) make such examination of the premises and plant and of any prescribed registers, record, and take on the spot or otherwise such evidence of persons or call for an information as he may deem necessary for carrying out the purposes of this Act; and

provided that no one shall be required under this section to answer any question or give an evidence tending to criminate himself.

(2) An Inspector shall report the matter to the Committee, if he found any company or industrial undertaking to which the scheme applies, within the local limits for which he is appointed has failed to comply with any of the provisions of this Act or the scheme for taking further necessary action under this Act.

8C. Power to amend the Schedule.– The Government may, by notification in the official Gazette, amend the Schedule.]

29Substituted by the Companies Profits (Workers’ Participation) (Amendment) Ordinance 2020 (XVII of 2020), published in the Punjab Gazette (Extraordinary), dated: 02 December 2020, pp,3839-3845 s.3

Inserted by the Companies Profits (Workers’ Participation) (Amendment) Ordinance 2020 (XVII of 2020), published in the Punjab Gazette (Extraordinary), dated: 02 December 202, pp,3839-3845 s.9

9. Power to make rules.– The 31[Government] may make rules to carry out the purposes of this Act.

10. Act to override other laws.– The provisions of this Act shall have effect notwithstanding anything contained in any other law for the time being in force, or in any contract or the memorandum or articles of association of a company.]

31Substituted by the Companies Profits (Workers’ Participation) (Amendment) Ordinance 2020 (XVII of 2020), published in the Punjab Gazette (Extraordinary), dated: 02 December 2020, pp,3839-3845 s.3

THE SCHEDULE SCHEME

[(See Section 2(c)]

1. Scope of the scheme.– The scheme applies to all companies 32[*] engaged in industrial undertakings which satisfy any one of the following conditions, and to such other companies as the 33[Government] may, by notification in the official Gazette, specify in this behalf, namely:–

(i) The number of workers employed by the company 34[* * *] at any time during a year is 35[50] or more.

(ii) The paid-up capital of the company as on the last day of its accounting year is Rs. 20 lacs or more.

(iii) The value of the fixed assets of the company (at cost) as on the last day of the accounting year is Rs. 40 lacs or more:---

36[Explanation.– In this scheme,---

(a) "industrial undertaking" means an institution, organization, enterprise or establishment which involves the use of electrical, mechanical, thermal, nuclear or any other form of energy transmitted mechanically and not generated by human or animal agency and which is engaged in any one or more of the following operations, namely:---

(i) the subjection of goods or materials to any manufacturing, assembly, finishing or other artificial or natural process, which changes their original condition or adds to their value;

(ii) 37[* * * * *]

(iii) the transformation, generation, conversion, transmission or distribution of electrical energy, including hydraulic power; 38[***] (iv) the working of a mine, oil-well or any other source of mineral deposit, including blending, refining and purification of oils and gases;

and includes companies engaged in the marketing and distribution of gas or oil or in the carriage of men or goods by sea or air, and any other institution, organisation, enterprise or establishment which the 39[Government] may, by notification in the

32The word “primarily” was omitted by the Companies Profits (Workers Participation) (Amendment) Ordinance, 1970 (XII of 1970), published in the Gazette of Pakistan (Extraordinary), dated: 1 July 1970, s. 5.

33Substituted by the Companies Profits (Workers’ Participation) (Amendment) Ordinance 2020 (XVII of 2020), published in the Punjab Gazette (Extraordinary), dated: 02 December 2020, pp,3839-3845 s.3

34The words “in any shift” were omitted by the Companies Profits (Workers Participation) (Amendment) Act, 1973 (XX of 1973);

assented to by the President on 4 February 1973, and was published in the Gazette of Pakistan (Extraordinary), dated: 7 February 1973, pp. 49-50, s. 3.

35Substituted ibid., for the figure “100”.

36Added by the Companies Profits (Workers Participation) (Amendment) Ordinance, 1970 (XII of 1970), published in the

Gazette of Pakistan (Extraordinary), dated: 1 July 1970, s. 5.

37 Omitted by the Companies Profits (Workers’ Participation) (Amendment) Ordinance 2020 (XVII of 2020), published in the Punjab Gazette (Extraordinary), dated: 02 December 2020, pp,3839-3845 s.10

38 Omitted by the Companies Profits (Workers’ Participation) (Amendment) Ordinance 2020 (XVII of 2020), published in the Punjab Gazette (Extraordinary), dated: 02 December 2020, pp,3839-3845 s.10

39Substituted by the Companies Profits (Workers’ Participation) (Amendment) Ordinance 2020 (XVII of 2020), published in the

official Gazette, declare to be an industrial undertaking for the purposes of this scheme; and

(b) references to the paid-up capital and the value of the fixed assets of the company shall, in the case of a company incorporated outside Pakistan but having a branch in Pakistan, be construed as references respectively to the capital invested in such branch and the value of the fixed assets of the branch.]

40[(v) a factory as defined under the Factories Act, 1934 (XXV of 1934);

(vi) a commercial establishment as defined under the Industrial and Commercial Employment (Standing Orders) Ordinance, 1968 (VI of 1968); and

(viii) a construction industry as defined under the Industrial and Commercial Employment (Standing Orders) Ordinance, 1968 (VI of 1968).]

41[2. Investment of Fund.– (1) The amount allocated or accruing to the Fund shall be available to the company for its business operations. The company may, however, request the Board to utilize the amount in the Fund for investment under sub-paragraph (7) and the Board may decide to so invest the amount.

(2) The company shall pay to the Fund in respect of the amount in the Fund available to it for its business operations as aforesaid interest at the rate of 2 1/2 percent above the bank rate or 75 per cent of the rate at which dividend is declared on its ordinary shares, whichever is higher. In case there is more than one class of ordinary shares on which different rates of dividend have been declared, then the weighted average of the different rates of dividend shall be taken for the purpose of determining the rate of interest. The interest to the Fund shall accrue on and from the first day of the year next succeeding the year in which the scheme becomes applicable to the company. Even when the company does not wish to utilize the amount available to it under sub-paragraph (1), interest at the rate aforesaid shall be payable by the company for the period between the date of allocation of any amount to the Fund and the date of its investment under subparagraph (7).

(3) If at any time after the establishment of the Fund, the company raises any additional capital, otherwise than through the issue of bonus or bonus shares, the Fund shall have the first option to convert any amount available to the company under sub-paragraph (1) or any of the assets of the Fund into ordinary equity capital up to a ceiling of 20 per cent of the paid up capital of the company prior to such conversion or 50 per cent of the additional capital, whichever is less.

Explanation.– In this sub-paragraph, "additional capital" does not include any apital

Punjab Gazette (Extraordinary), dated: 02 December 2020, pp,3839-3845 s.3

Inserted by the Companies Profits (Workers’ Participation) (Amendment) Ordinance 2020 (XVII of 2020), published in the Punjab Gazette (Extraordinary), dated: 02 December 2020, pp,3839-3845 s.10

41Substituted by the Companies Profits (Workers Participation) (Amendment) Ordinance, 1970 (XII of 1970), published in the Gazette of Pakistan (Extraordinary), dated: 1 July 1970, s. 5.

offered or to be offered to foreign participants of the company.

(4) For the exercise of the right of conversion under sub-paragraph (3), the Board shall be given sufficient time to sell assets of the Fund to realise the amount needed for subscription to the additional issue of capital by the company.

(5) The shares acquired in the manner set out in sub-paragraph (3) shall participate in future bonus and right issues in the same manner as other shares.

(6) The shares acquired in the manner set out in sub-paragraph (3) shall carry voting rights in the same manner as other shares and such voting rights shall be exercised by the Board on behalf of the Fund.

(7) The amount in the Fund which, under sub-paragraph (1), the company has requested to be utilized for investment under this paragraph my be invested by the Board for the purchase of any of the following, namely:---

(a) I.C. P. Mutual Fund Certificate;

(b) National Investment Trust (Unit) Certificates;

(d) any other securities approved for the purpose by the 42[Government].]

43[3. Eligibility to benefits of scheme.– All workers shall be eligible to the benefits of the scheme and to participate in the Fund. However, a worker not completing six months of employment with the company during a year of account shall not participate in the Fund in respect of that year.

4. Distribution of benefits to workers.– The share of a worker in the annual allocation to the Fund shall be expressed in units or fractions of units (worked out to two places of decimal) of the face value of Rs. 10 determined in the following manner, namely:---

44[(a) The number of available units shall be so divided into three parts for the three categories of workers mentioned below that a worker in the first of those categories gets four units for each two units that a worker in the second of those categories gets or for each one unit that a worker in the last of these categories gets:

Categories

45[“1. Workers drawing average monthly wages not less than the minimum wages for unskilled workers fixed, from time to time, by the Government.

42Substituted by the Companies Profits (Workers’ Participation) (Amendment) Ordinance 2020 (XVII of 2020), published in the Punjab Gazette (Extraordinary), dated: 02 December 2020, pp,3839-3845 s.3

43Substituted by the Companies Profits (Workers Participation) (Amendment) Ordinance, 1970 (XII of 1970), published in the Gazette of Pakistan (Extraordinary), dated: 1 July 1970, s. 5.

44Substituted by the Labour Laws (Amendment) Ordinance, 1972 (IX of 1972), published in the Gazette of Pakistan (Extraordinary), dated: 13 April 1972, s. 2 read with the First Schedule.

Substituted by the Companies Profits (Workers’ Participation) (Amendment) Ordinance 2020 (XVII of 2020), published in the Punjab Gazette (Extraordinary), dated:02 December 2020, pp,3839-3845 s.10

2. Workers drawing average monthly wages exceeding the minimum wages for unskilled workers fixed, from time to time, by the Government but not exceeding five thousand rupees in excess thereof.

3. Workers drawing average monthly wages exceeding upper level of wages fixed for category 2.]

(c) The number of units available to each category of workers shall be divided equally among all the workers in that category to determine the share of each worker of that category.

46[(d) Notwithstanding anything contained in this scheme, no worker shall, in any one year, be entitled out of the annual allocation of units exceeding the amount of four times the minimum wages for unskilled workers as given under the Punjab Minimum Wages Act 2019 in value in so far as such allocation is relatable to clause (b) of subsection (1) of section (3).

Any amount left out of the annual allocation after the units have been so allocated shall be transferred to the Fund established under the Punjab Workers Welfare Fund Act 2019. No part of such amount shall be deemed to be included in the net asset value of Fund established under this Act and no individual worker shall have any lien on this amount by virtue of holding any units47[:]

48[Provided that the amount left out of the annual allocation after allocation of units under this Act and which has not been transferred since the enforcement of the Constitution (Eighteenth Amendment) Act, 2010 to the ‘Workers Welfare Fund’ constituted under the Workers Welfare Fund Ordinance, 1971 (XXXVI of 1971), shall be transferred, to the ‘Punjab Workers Welfare Fund’ established under the Punjab Workers Welfare Fund Act 2019 (XXVI of 2019), within sixty days from the publication of this notification in the official Gazette.]

Explanation: In this paragraph, “average monthly wages” means total wages drawn during the year of account divided by 12, or by the number of months a worker actually worked during a year in respect of which he is entitled to the benefit under the scheme, as the case may be, and “wages” has the same meaning as in clause (vi) of section 2 of the Payment of Wages Act, 1936 (IV of 1936); but does not include any overtime allowance, bonus and gratuity or provident fund payable.]

5. Disbursement of benefits.– The disbursement of the benefits from the fund shall be as under:---

(a) 100 per cent of the annual income of the Fund, including capital gains realized, shall be distributed each year to workers in proportion to their units of entitlement.

46Substituted by the Companies Profits (Workers’ Participation) (Amendment) Ordinance 2020 (XVII of 2020), published in the Punjab Gazette (Extraordinary), dated: 02 December 2020, pp,3839-3845 s.10

Substituted by Notification No. 70 of 2021, issued under section 8C of the Companies Profits (Workers Participation) Act, 1968 (XII of 1968), published in the Punjab Gazette (Extraordinary), dated: 02 March 2021, pp,6683-6684.

48 Substituted by Notification No. 70 of 2021, issued under section 8C of the Companies Profits (Workers Participation) Act, 1968 (XII of 1968), published in the Punjab Gazette (Extraordinary), dated: 02 March 2021, pp,6683-6684.

49[(b) A worker who voluntarily leaves the employment of the company or

whose services are terminated shall be entitled to receive 100 per cent, of the net asset value of the units standing in his name.]

50[(c) * * * * * * * * * * * ]

(d) * * * * * * * * * * * ]

(e) * * * * * * * * * * * ]

51[(f) A worker who continues in the service of the company shall be entitled

to receive 100 per cent of the net asset value of the units in his name

each year or he may choose to leave his share in the Fund:

Provided that a worker while in employment may choose to encash all the

units standing in his name at any time at his discretion.]

(g) A worker, in the event of his retirement or, his nominated beneficiary, in the event of the worker's death (from whatsoever cause) while in the employment of the company, shall receive 100 per cent of the net asset value of the units standing in the worker's name 52[* * * * * *].

6. Definition of the net asset value of the unit.– To determine the net asset value of a unit; the total net assets of the Fund, namely, market value of the securities, cash and other assets resulting from the investment and re-investment, capital accretion thereto and all incomes of any kind rising there from shall be divided by the number of units in the Fund. Net asset value of the entire Fund shall be computed once every year and each worker's unit entitlement determined at the same time. Additional units will be given to the workers according to the amount they voluntarily contribute to the Fund.

53[7. Employee's own contribution.– A worker may voluntarily choose to contribute a part of his wages, cash bonus, dividend or interest to the Fund. For each unit of contribution, he shall receive credit for 1-1/4 units. Contribution received during the course of a year of account shall, however, be deemed to be contribution received on the last day of that year. If at any time a worker chooses to leave the employment of the company or 54[his services are terminated or in the event of his retirement or death or on the expiry of three years from the date he voluntarily chooses to contribute a part of his wages, cash bonus, dividend or interest to the Fund, he, at his option, or, in the event of his death, his nominated beneficiary, may],

49Substituted by the Companies Profits (Workers Participation) (Amendment) Act, 1973 (XX of 1973); assented to by the President on 4 February 1973, and was published in the Gazette of Pakistan (Extraordinary), dated: 7 February 1973, pp. 49-50, s. 3. It was earlier substituted by the Companies Profits (Workers Participation) (Amendment) Ordinance, 1970 (XII of 1970), published in the Gazette of Pakistan (Extraordinary), dated: 1 July 1970, s. 5.

50Omitted by the Companies Profits (Workers Participation) (Amendment) Act, 1973 (XX of 1973); assented to by the President on 4 February 1973, and was published in the Gazette of Pakistan (Extraordinary), dated: 7 February 1973, pp. 49-50, s. 3.

51Substituted by the Companies Profits (Workers Participation) (Amendment) Act, 1973 (XX of 1973); assented to by the President on 4 February 1973, and was published in the Gazette of Pakistan (Extraordinary), dated: 7 February 1973, pp. 49-50, s. 3.

52The words “irrespective of the period of employment” were omitted ibid.

53Substituted by the Companies Profits (Workers Participation) (Amendment) Ordinance, 1970 (XII of 1970), published in the Gazette of Pakistan (Extraordinary), dated: 1 July 1970, s. 5.

54Substituted for the words, figure and commas “on the expiry of 3 years from the date he becomes entitled to the benefits of the scheme, he may, at his option” by the Companies Profits (Workers Participation) (Amendment) Act, 1973 (XX of 1973);

assented to by the President on 4 February 1973, and was published in the Gazette of Pakistan (Extraordinary), dated: 7 February 1973, pp. 49-50, s. 3.

receive, the net asset value of the units representing his contribution. The contribution by a worker in any one year of account shall not exceed 10 per cent of his annual wages during such year.]

55[8.* * * * *]

9. Tax treatment of the income of the Fund.– 56[The Government may approach the Federal Government for exemption from the levy of income tax on the income of the Fund including capital gains.]

10. Tax treatment of the income to the workers.– All sums paid out by the Fund shall be exempt from income-tax in the hand of the workers.

57[11. Working and location of the Board of Trustees.– The office of the Board of

Trustees shall be located at the factory premises or, if there is more than one factory run by the company, at the registered head office of the company. All expenses of the Board, including the cost of maintaining accounts, shall be borne by the company.]

12. Audit of the Fund accounts.– The Fund accounts shall be audited annually at the company's expense in the same manner as the accounts of the company are audited:---

Provided that the 58[Government] may, at its own cost, appoint independent accountants for a special audit of the accounts of the Fund.

13. Scheme's benefits to be in addition to other benefits.– The benefits to a worker under this scheme shall be in addition to, and not in derogation or substitution of, any other benefits to which the worker maybe entitled under any other law, contract, terms and conditions of employment or otherwise.

59[14. Special provision for industries working seasonally.– Notwithstanding anything contained in this Act or this scheme the 60[Government], may, by notification in the official Gazette, make special provisions61 for the participation of workers in the

55Omitted by the Companies Profits (Workers’ Participation) (Amendment) Ordinance 2020 (XVII of 2020), published in the Punjab Gazette (Extraordinary), dated: 02 December 2020, pp,3839-3845 s.10

56 Substituted by the Companies Profits (Workers’ Participation) (Amendment) Ordinance 2020 (XVII of 2020), published in the Punjab Gazette (Extraordinary), dated: 02 December 2020, pp,3839-3845 s.10

57Substituted by the Companies Profits (Workers Participation) (Amendment) Ordinance, 1970 (XII of 1970), published in the Gazette of Pakistan (Extraordinary), dated: 1 July 1970, s. 5.

58Substituted by the Companies Profits (Workers’ Participation) (Amendment) Ordinance 2020 (XVII of 2020), published in the Punjab Gazette (Extraordinary), dated: 02 December 2020, pp,3839-3845 s.3

59Added by the Companies Profits (Workers Participation) (Amendment) Ordinance, 1970 (XII of 1970), published in the Gazette of Pakistan (Extraordinary), dated: 1 July 1970, s. 5.

60Substituted by the Companies Profits (Workers’ Participation) (Amendment) Ordinance 2020 (XVII of 2020), published in the Punjab Gazette (Extraordinary), dated: 02 December 2020, pp,3839-3845 s.3

61The Federal Government made the following special provisions for the participation of workers in the profit of the companies engaged in the following industrial undertakings which operate only for a part of year.

(I) for the purpose of clause (f) of section 2 of the Act, of Paragraph 3 of the schedule thereto a worker of an industrial undertaking engaged in the manufacturing of sugar, ginning, willing of cotton or processing of Tobacco to which paragraph one for the said schedule applies shall be deemed to have completed six months of continuous employment with the company and eligible to the benefits of the scheme, if he is in continuous employment of the industrial undertaking for not less than half of the period for which undertaking has operated in a year of account.

(II) For the purpose of disbursement of benefits to workers in accordance with paragraph 5 of the schedule, worker of

profit of companies engaged in industrial undertakings which operate only for a part

of the year.

15. Companies engaged in more than one industrial undertakings.-

Notwithstanding anything contained in this Act or this scheme, the 62[Government] may, at the request of a company which is engaged in more than one industrial undertakings located at different places, permit the splitting up of the Fund amongst the various undertakings or groups of undertakings and constitution of a Board of Trustees for each such undertaking or group of undertakings; and thereupon the provisions of this Act and this scheme shall have effect in relation to such undertakings or groups as if each such undertaking or group were a company.

16. Entrustment of management of Fund to Investment Corporation of Pakistan, etc.– The Board of Trustees may, with the prior approval of the 63[Government], enter into a contract with the Investment Corporation of Pakistan, the National Investment Trust or the National Bank of Pakistan entrusting the management of the Fund to that Corporation, Trust or Bank on such fee which shall be payable by the company, and on such terms and conditions as may be mutually agreed upon.]

an industrial undertaking which is not in continuous operation for the whole of the year shall be credited–

(a) with a year of continuous employment if he has been continuous employment with that undertaking for the entire period for which it has operated in the year of account; and

With period of continuous employment as that period bears to the period he continuously worked with the undertaking the same proportion as the whole year bears to the total period for which the undertaking operated during a year of account. See Gazette of Pakistan (Extraordinary), dated: 20 August 1971.

62Substituted by the Companies Profits (Workers’ Participation) (Amendment) Ordinance 2020 (XVII of 2020), published in the Punjab Gazette (Extraordinary), dated: 02 December 2020, pp,3839-3845 s.3

63Substituted by the Companies Profits (Workers’ Participation) (Amendment) Ordinance 2020 (XVII of 2020), published in the Punjab Gazette (Extraordinary), dated: 02 December 2020, pp,3839-3845 s.3

[1] Omitted by section 2 of the Companies Profits (Workers’ Participation) (Amendment) Ordinance, 2018 (Ordinance No. VII of 2018), published in Gazette of the Punjab Extraordinary, vide No. Legis: 13-77/2010(C)(P-I), dated 01-06-2018.

[2] Substituted by section 4 of the Companies Profits (Workers’ Participation) (Amendment) Ordinance, 2018 (Ordinance No. VII of 2018), published in Gazette of the Punjab Extraordinary, vide No. Legis: 13-77/2010(C)(P-I), dated 01-06-2018.

[3] Substituted by section 5(a) of the Companies Profits (Workers’ Participation) (Amendment) Ordinance, 2018 (Ordinance No. VII of 2018), published in Gazette of the Punjab Extraordinary, vide No. Legis: 13-77/2010(C)(P-I), dated 01-06-2018.

[4] Omitted by section 3(a) of the Companies Profits (Workers’ Participation) (Amendment) Ordinance, 2018 (Ordinance No. VII of 2018), published in Gazette of the Punjab Extraordinary, vide No. Legis: 13-77/2010(C)(P-I), dated 01-06-2018.

[5] Inserted by section 5(b) of the Companies Profits (Workers’ Participation) (Amendment) Ordinance, 2018 (Ordinance No. VII of 2018), published in Gazette of the Punjab Extraordinary, vide No. Legis: 13-77/2010(C)(P-I), dated 01-06-2018.

[6] Inserted by section 5(c) of the Companies Profits (Workers’ Participation) (Amendment) Ordinance, 2018 (Ordinance No. VII of 2018), published in Gazette of the Punjab Extraordinary, vide No. Legis: 13-77/2010(C)(P-I), dated 01-06-2018.

[7] Substituted by section 5(d) of the Companies Profits (Workers’ Participation) (Amendment) Ordinance, 2018 (Ordinance No. VII of 2018), published in Gazette of the Punjab Extraordinary, vide No. Legis: 13-77/2010(C)(P-I), dated 01-06-2018.

[8] Substituted by section 5(e) of the Companies Profits (Workers’ Participation) (Amendment) Ordinance, 2018 (Ordinance No. VII of 2018), published in Gazette of the Punjab Extraordinary, vide No. Legis: 13-77/2010(C)(P-I), dated 01-06-2018.

[9] Substituted by section 6 of the Companies Profits (Workers’ Participation) (Amendment) Ordinance, 2018 (Ordinance No. VII of 2018), published in Gazette of the Punjab Extraordinary, vide No. Legis: 13-77/2010(C)(P-I), dated 01-06-2018.

[10] Omitted by section 3(a) of the Companies Profits (Workers’ Participation) (Amendment) Ordinance, 2018 (Ordinance No. VII of 2018), published in Gazette of the Punjab Extraordinary, vide No. Legis: 13-77/2010(C)(P-I), dated 01-06-2018.

[11] Omitted by section 3(a) of the Companies Profits (Workers’ Participation) (Amendment) Ordinance, 2018 (Ordinance No. VII of 2018), published in Gazette of the Punjab Extraordinary, vide No. Legis: 13-77/2010(C)(P-I), dated 01-06-2018.

[12] Omitted by section 3(a) of the Companies Profits (Workers’ Participation) (Amendment) Ordinance, 2018 (Ordinance No. VII of 2018), published in Gazette of the Punjab Extraordinary, vide No. Legis: 13-77/2010(C)(P-I), dated 01-06-2018.

[13] Inserted by section 7 of the Companies Profits (Workers’ Participation) (Amendment) Ordinance, 2018 (Ordinance No. VII of 2018), published in Gazette of the Punjab Extraordinary, vide No. Legis: 13-77/2010(C)(P-I), dated 01-06-2018.

[14] Omitted by section 3(a) of the Companies Profits (Workers’ Participation) (Amendment) Ordinance, 2018 (Ordinance No. VII of 2018), published in Gazette of the Punjab Extraordinary, vide No. Legis: 13-77/2010(C)(P-I), dated 01-06-2018.

[15] Inserted by section 8(b) of the Companies Profits (Workers’ Participation) (Amendment) Ordinance, 2018 (Ordinance No. VII of 2018), published in Gazette of the Punjab Extraordinary, vide No. Legis: 13-77/2010(C)(P-I), dated 01-06-2018.

[16] Omitted by section 3(a) of the Companies Profits (Workers’ Participation) (Amendment) Ordinance, 2018 (Ordinance No. VII of 2018), published in Gazette of the Punjab Extraordinary, vide No. Legis: 13-77/2010(C)(P-I), dated 01-06-2018.

[17] Inserted by section 8(c) of the Companies Profits (Workers’ Participation) (Amendment) Ordinance, 2018 (Ordinance No. VII of 2018), published in Gazette of the Punjab Extraordinary, vide No. Legis: 13-77/2010(C)(P-I), dated 01-06-2018.

[18] Omitted by section 3(a) of the Companies Profits (Workers’ Participation) (Amendment) Ordinance, 2018 (Ordinance No. VII of 2018), published in Gazette of the Punjab Extraordinary, vide No. Legis: 13-77/2010(C)(P-I), dated 01-06-2018.

[19] Omitted by section 3(a) of the Companies Profits (Workers’ Participation) (Amendment) Ordinance, 2018 (Ordinance No. VII of 2018), published in Gazette of the Punjab Extraordinary, vide No. Legis: 13-77/2010(C)(P-I), dated 01-06-2018.

[20] Omitted by section 3(a) of the Companies Profits (Workers’ Participation) (Amendment) Ordinance, 2018 (Ordinance No. VII of 2018), published in Gazette of the Punjab Extraordinary, vide No. Legis: 13-77/2010(C)(P-I), dated 01-06-2018.

[21] Inserted by section 9 of the Companies Profits (Workers’ Participation) (Amendment) Ordinance, 2018 (Ordinance No. VII of 2018), published in Gazette of the Punjab Extraordinary, vide No. Legis: 13-77/2010(C)(P-I), dated 01-06-2018.

[22] Omitted by section 3(a) of the Companies Profits (Workers’ Participation) (Amendment) Ordinance, 2018 (Ordinance No. VII of 2018), published in Gazette of the Punjab Extraordinary, vide No. Legis: 13-77/2010(C)(P-I), dated 01-06-2018.

The Schedule (Scheme) [See section 2(e)]

The Companies’ Profits (Workers’ Participation) Rules, 1971

Model procedure for the maintenance of accounts of Workers’ Participation Fund