1. Overview of the Case
The petitioners invoked the constitutional jurisdiction of the Sindh High Court under Article 199 of the Constitution of Islamic Republic of Pakistan, 1973, challenging the judgment of the Sindh Labour Appellate Tribunal to the extent of restricting back benefits following their reinstatement. The High Court disposed of the constitutional petitions by setting aside the appellate tribunal's order restricting back benefits, and directed that the petitioners be provided full back benefits along with all consequential service advantages from the date of termination till actual reinstatement.
2. Brief Facts
It appears from the record that the two sets of appeals filed before the learned Sindh Appellate Tribunal (SLAT) arise out of a common judgment dated 20.10.2023 passed by the learned Labour Court No. Briefly stated, the petitioners/workers, who had rendered service ranging from 7 to 16 years at different positions in the establishment, were accused in the year 2020 of allegedly embezzling an amount of approximately Rs. 3.5 Crore by fabricating bogus records of daily wagers for the period from 2016 to 2020.
3. Questions of Law
- Whether an employee reinstated after an unlawful termination is automatically entitled to full back benefits?
- Does the acquittal of an employee in criminal proceedings nullify the foundation of a termination based on the same allegations?
4. The Court’s Answers
Question 1
Whether an employee reinstated after an unlawful termination is automatically entitled to full back benefits?
“Once such termination is declared unlawful and the employee is ordered to be reinstated, the normal rule is that reinstatement must follow with full back benefits, unless the employer establishes through cogent evidence that the employee remained gainfully employed elsewhere during the intervening period.”
Paragraph 12
Question 2
Does the acquittal of an employee in criminal proceedings nullify the foundation of a termination based on the same allegations?
“The acquittal effectively removed the very foundation on which the impugned termination orders were based.”
Paragraph 11
5. Practical Relevance
Employers should document disciplinary allegations, provide the required opportunity of defence and consider the consequences of an unlawful termination. Employees and advisers should examine the actual order, underlying inquiry and available remedies.