THE Employees Cost of Living (Relief) Act 1973 was promulgated by the first Pakistan Peoples Party government in 1973. This was a remedy devised in response to massive complaints of exploitation lodged with the government by labour leaders.

The government had no means to compel the employers to reinstate workers dismissed from service due to closure of industries, illegal strikes or indiscipline by the workforce. However, it could use the Parliament’s authority to impose upon the employers mandatory provisions of law to increase the wages of workers who were still employed.

How far the government succeeded in appeasing the industrial workers could not be gauged, but it definitely annoyed both the progressive as well as unscrupulous employers. The former, because they were already taking good care of their employees by paying them well and allowing various benefits, the latter resented it because they did not like interference from the government in managing their enterprises. Nevertheless, this method of allowing a compulsory increase in workers’ salary found favour with the successive governments thereafter, and the following 11 cost of living allowances (COLAs) have so far been introduced through legislation by both the martial law and civilian governments:

Barring four COLAs amounting to Rs475, given regardless of wages, the others have a wage ceiling. The definition of ‘wage’, given in the Act, means the basic wage although this term has not been used in law. By perusal of the above, one can imagine how complex it is to determine the amount of COLA of an employee who joins a company at a basic salary of less than Rs4,065. Following are two instances:
 

Basic	Salary COLA
Rs	Rs
1,450	916
4,050	575

In this regard, one contentious issue has been the denial by the government of the right to set off these COLAs against the amounts payable by an employer under a settlement reached with his Collective Bargaining Agent union. The martial law government of the late Ziaul Haq was the only one which gave this right to employers in respect of the four COLAs introduced during his period. The various governments have made this law so complicated that without it, the employers can simplify their salary structure which will also be better understood by the employees. Even if the Act is abolished, employers who have been complying with it religiously will not reduce the salary of their employees. On the other hand, it will be unrealistic to expect compliance by employers, who have flagrantly violated the Act for the last three decades.

In view of the above, my advice to the government is to immediately repeal the Employees Cost of Living (Relief) Act, 1973, as its utility has been outlived. This will also be a step forward towards simplification of labour laws, which the government has been aspiring for since the last many years.