MEMORANDUM OF SETTLEMENT MONDELEZ PAKISTAN LIMITED AND CADBURY PAKISTAN PROGRESSIVE EMPLOYEES’ UNION - 2012

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1st May, 2012 To 30th April, 2014

MEMORANDUM OF SETTLEMENT

(Under Clause 2 (xxix) read with Section 38(4) of the Industrial Relation Act, 2012)

NAME OF PARTIES

1. Mondelez Pakistan Limited (formerly known as Kraft Foods Pakistan Limited) a Company incorporated in Pakistan with its registered office at 5th Floor, Tower B, World Trade Centre, Khayana-e-Roomi, Clifton, Karachi – 75600 and its factory at A 60-77, H.I.T.E, HUB District Lasbela, Baluchistan, hereinafter referred to as “the Company” (which expression wherever the context so admits shall mean and include its successors and assigns).

AND

2. Cadbury Pakistan Progressive Employees’ Union (Registration No. 03/98, C.B.A 7/89) having its registered office at Flat No. 11, Al-Mubashir Apartments, SB-36, Block – 13/C, Gulashan e Iqbal, Karachi, hereinafter referred to as the “Collective Bargaining Agent” (which expression wherever the context so admits shall mean and include its successors

REPRESENTING THE EMPLOYER REPRESENTING THE WORKMEN
1. Mr. Ahmar Jahanzeb Iqbal

Directory Supply Chain

1. Mr. Abdul Aziz

General Secretary

2. Mr. Muhammad Azim-u-Shan Khan

Manager Human Resources & IR

2. Mr. Muhammad Saleem

President

3. Mr. Fahad Zakaria

Plant Controller

3. Mr. Muhammad Akber

Vice President

4. Mr. Iqbal Hussain

4. Mr. Masood Khan

Joint Secretary

5.Mr. Amir Bux

Finance Secretary

6. Mr. Muhammad Mirza

Propaganda Secretary

SHORT RECITAL OF THE CASE

WHEREAS the C.B.A and the Company served notice under Section 35 (1) of the Industrial Relations Act, 2012 upon each other along with their respective Charter of Demands on 2nd May, 2012. (Copies of the said Charter of Demands are enclosed and marked as Annexure “A” and “B” respectively to this Settlement).

AND WHEREAS upon receipt of the said Charter of Demands under Section 35(1) of the Industrial Relations Act, 2012 the Company and the C.B.A entered into bilateral negotiations and collective bargaining on the said Charter of Demands period of which was mutually extended from time to time with a view to reach an amicable settlement.

AND WHEREAS during the course of discussion and negotiations, the C.B.A pleaded increase in the Cost of Living and inflationary trend and the expected rise in the cost of living during the operative period of this Settlement as justification of its demands for higher monetary benefits to the workers which factors have been taken into consideration by the Company to reach the following full and final Settlement in respect of all the demand raised in the Charter of Demands submitted by the C.B.A and the Company.

NOW THEREFORE this Settlement witness as follows:

TERMS OF SETTLEMENT

1. INCREASES IN WAGES FOR YEARS 2012 & 2013

1.1 It has been agreed by the Management/Company and the C.B.A Union that the wages of the eligible permanent workers of the Company who fall under the purview/ambit of IRA, 2012 and who have completed on year continuous service as on 01-05-2012 shall be increased by 14 (fourteen) percent only w.e.f 01-05-2012.

1.2 It has also been agreed that the wages of the eligible permanent workers of the Company who have completed one year continuous services as on 01-05-2012 shall be given additional one-time flat increase of Rs. 600/- only in their Gross Salary w.e.f. 01-05-2012. The said flat increase will be given after computing the annual increase as defined in section 1.1 & bifurcated into Basic Salary, House Rent and Utility Allowances.

1.3 The Management/Company and the C.B.A Union have further agreed that the wages of eligible permanent workers of the Company who fall under the purview/ambit of Industrial & Commercial Employment (Standing Orders) Ordinance, 1968 and would complete one-year continuous service as on 01-05-2013 shall be increased by 14 (fourteen) percent only w.e.f. 01-05-2013.

1.4 It has been agreed between the Management/Company and C.B.A Union that while calculating the increase in wages as defined in section 1.1 & 1.3, only Basic Salary, House Rent Allowances, Utility Allowance, Conveyance Allowance, D.O.M Wages and Adhoc Relief shall be included for the increase.

1.5 That the above mentioned increases in wage/salary shall be bifurcated into Basic Salary, House Rent Allowance, Utility Allowance.

2. BONUS (Inclusive of Standing Order 10-C)

2.1 It has been agreed by the Management/Company and the C.B.A Union that all permanent eligible workers who have completed one year continuous services and who will be on the roll of the Company at the time of disbursement of Bonus for year 2012 shall be paid a total of 35 days wages as defined under clause 1.4 herein above of this Settlement towards Bonus for the year 2012 on the occasion of Eid (15 days wages on the occasions of Eid-ul-Fitar and 20 days wages on Eid-ul-Azha) as the case may be irrespective of profit of profit as contemplated U/s.o 10-C of the Industrial & Commercial Employment (Standing Orders) Ordinance 1968.

2.2 It has been agreed by the Management/Company and the C.B.A Union that all permanent eligible workers who have completed one year continuous service and who will be on the roll of the Company at the time of disbursement of Bonus for year 2013 shall be paid a total of 35 days wages as defined under clause 1.4 herein above of this Settlement towards Bonus for the year 2013 on the occasion of Eid (15 days wages on the occasions of Eid-ul-Fitar and 20 days wages on Eid-ul-Azha) as the case may be irrespective of profit as contemplated U/s.o 10-C of the Industrial & Commercial Employment (Standing Orders) Order 1968.

2.3 It has been further agreed between the Management/Company and the C.B.A Union that in case of profit as contemplated and defined under Standing Order 10-C of Industrial and Commercial Employment (Standing Orders) Ordinance 1968, eligible workers shall be paid on full S.O. 10-C Bonus after audit for both years i.e. 2012 and 2013.

2.4 The above Bonuses under clause 2.1 and 2.2 for both the years 2012 and 2013 shall be paid along with the monthly salary earlier of the said respective festivals and C.B.A union shall not compel the Management/Company for any further or earlier payment in any manner whatsoever.

3. FAMILY MEDICAL ALLOWANCE

It has been agreed by the Company that the monthly Family Medical Allowance will be increased by Rs. 100/- from Rs. 400/- to Rs. 500/- per month. Other terms and conditions shall remain unchanged.

4. CYCLE ALLOWANCE

it has been agreed by the Company that the Cycle Allowance will be discontinued effective 01 June 2014 or earlier provided that company provides transport services for the workers residing at Sakaran.

5. ATTENDANCE ALLOWANCE

5.1 The monthly Attendance Allowance will be paid as follows:

a) Rs. 600/- on full attendance during the calendar month (without availing any leave)

b) Rs. 350/- on availing one approved leave during the calendar month.

5.2 The monthly attendance allowance will not be payable in case of following:

a) On availing more than one leave

b) Any absence without leave and/or leave without pay

6. EID ADVANCE

It has been further agreed between the Management/Company and the C.B.A Union that all permanent eligible workers who have completed one year continuous service and who will be on the roll of the Company shall be paid a total 15 days wages towards Advance against salary for both the years 2012 and 2013 on the occasion of Eid (7.5 days wages along with the salary before the occasion of Eid-ul-Fitar and 7.5 days wages along with the salary before Eid-ul-Azha). The said advances will be deducted from employees next year’s April salary in 2013 and 2014 respectively. However, in case of loss as contemplated and defined under Standing Order 10-C of Industrial and Commercial Employment Ordinance 1968, the Eid advances will not be recovered from employees on special request of C.B.A.

7. PICNIC

It is agreed that for the year 2012 and 2013 the amount for the arrangement of Annual Picnic is increased by Rs. 35,000/- from 65,000/- to Rs. 100,000/- per annum.

8. UNION OFFICE

It has been agreed by the Company that the monthly Union Office Rent will be increase by Rs. 2,500/- from Rs. 1,500/- to Rs. 4,000/- per month.

9. EID GIFTS

It has been agreed that on occasions of Eid-ul-Fitar and Eid-ul-Azha the Company will provide mixed available products to all permanent workmen equivalent to an amount of Rs. 3,000/-

10. LONG SERVICE AWARD

It has been agreed that the Company shall give long service award to the permanent workers of the company on completion of 15 & 25 years of continuous services with the company as follows from 10-05-2014:

a) Rs. 15,000/- on completion of 15 years of service.

b) Rs. 25,000/- on completion of 25 years of service.

This award will be paid to the workers along with the monthly salary of the respective month in which the worker has completed his along service. However, to keep the process transparent and fair with those permanent workers who as of 10/05/2014 have already crossed the services milestone of 25 years of service, as a special case, they will be allowed 25 years award payment as this will be the only long service award they will receive in their employment with the company.

11. ANNUAL LEAVES

It has been agreed that the Annual leaves entitlement will be increased from 14 to 21 working days.

12. PENDING LITIGATIONS

12.1 Upon signing of this settlement, the company shall withdraw Case No. 4A (54)/2013 from the NIRC.

12.2 Upon signing of this Settlement, the C.B.A has also agreed to withdraw Case No. 4A (37)/2013 from the NIRC

13. DISCIPLINE

a. That it has been agreed by the C.B.A Union that the C.B.A Union and eligible workers shall abide with regards to maintaining discipline, reducing the level of absenteeism and maintaining Cadbury Factory Quality, Health and Safety Standards as updated from time to time and other Quality Standards as laid down in the Manual of Foods Laws 1994, Safety and Health standards as laid down in the Factories Act, 1934.

b. It has been agreed by the Union that the no worker will be allowed for smoking, Niswar, Gul, Gutka, and/or Pan in the factory premises since the use of such things in a Food Factory due to quality standards are prohibited.

c. In case if any worker is found indulging in consumption/use of aforesaid substance as mentioned in clause 13(a) & (b), strict disciplinary action will be taken against him.

14. SET OFF ADJUSTMENT

That it has been agreed by the Company and C.B.A union that in case if any increase is announced by the Government during the tenure of this Settlement to meet the increase in the cost of living, the same shall be decided as per contents/language/spirit of such announcement/order/law.

15. SETTLEMENT OF AMBIGUITY

That it has been agreed by the Company and C.B.A Union that in case of any ambiguity in this Settlement the C.B.A Union and the Company shall discuss the same and try to settle amicably and in case the same is not settled between the parties, the Company’s decision in this connection shall be final and binding on both the parties.

16. CO-OPERATION BY C.B.A UNION

That it has been agreed by the C.B.A Union that in consideration and in acceptance of the aforementioned demands by the Company, the C.B.A Union will provide their full cooperation to the Company.

17. CLEANLINESS IN THE FACTORY

a. That it has been agreed by the C.B.A Union that the C.B.A Union will extend cooperation in maintaining the Factory neat and clean and will prevail upon the workers to keep themselves neat and clean as well as their respective work place & machines.

b. That the C.B.A Union will also persuade the workers not to go on their respective work place without cap, shoes, uniform and ensure that the workers wear gloves whenever, necessary while performing their duties.

18. GENERAL

a. That it has been agreed by the C.B.A Union that the C.B.A Union will extend all sort of cooperation in increasing quality production and to control wastage of raw material, wrappers and pouches.

b. That it has been agreed by the C.B.A Union that they will not raise any objection if a worker is transferred from one section to another section.

c. That it has been agreed that the C.B.A Union shall fully cooperate with the Company so that the workers should reach immediately at the place of work and they should not leave their place of work before time and during working hours the workers should not leave places of works without prior permission of their respective supervisors.

d. That it has been agreed by the C.B.A Union that the C.B.A Union/worker will fully cooperate with the Company in controlling the Factory cost.

19. EFFECTIVE DATES OF INCREASED BENEFITS

The effective dates of various benefits and increases granted or discontinued in this Settlement are as follows:

Increase in wages 2012 01-05-2012
Increase in wages 2013 01-05-2013
Bonus 01-05-2012
Family Medical Allowance 01-05-2012
Cycle Allowance Date of providing transport service for sakraan
Attendance Allowance Date of signing of Settlement
Eid Advance 01-05-2012
Picnic Date of signing of Settlement
Union Office rent 01-05-2012
Eid Gifts Date of signing of Settlement
Annual Leaves 01-01-2014
Long Service Award as per details in clause 10 of this agreement

20. DURATION OF SETTLEMENT

This settlement will come into effect from May 1, 2012 and shall remain in force and binding upon the parties for a period of two years i.e. until April 30, 2014. For the duration of this Settlement the Union as well as Company will not re-advance or raise any demands which were included in their respective Charter of Demands and will also not raise any fresh demands whatsoever.

21.SAVING OF EXISTING TERMS AND CONDITIONS

All terms and conditions including the terms agreed to in all previous Settlements between the Company and the C.B.A and which have not been modified through this Settlement will continue to remain in force.

22. FINALITY

a) It is agreed that this Settlement is in the nature of a package deal and is in full and final settlement of all demands contained in the Union’s as well as Company’s respective Charter of Demands including all those demands or disputes not specifically mentioned in this Settlement but covered/raised by the said Charters of Demands and shall be deemed to have been settled, modified and/or withdrawn in accordance with and/or in consideration of the Settlement.

b) It is agreed that the C.B.A will continue to cooperate in maintaining industrial peace and also to cooperate with the Company in its efforts to increase productivity, maintenance of discipline, improvement of production plans and facilities, and improvement in efficiency and shall not resort to any action involving curtailment of production and/or efficiency.

In witness whereof the parties above named have signed hereunder at Karachi, on 29th April, 2014.

*****

Memorandum of Settlement Mondelez Pakistan Limited and Cadbury Pakistan Progressive Employees’ Union - 2012

Start date: → 2012-05-01
End date: → 2014-04-30
Ratified by: → Other
Ratified on: → 2014-04-29
Name industry: → Manufacturing
Name industry: → Manufacture of beverages
Public/private sector: → In the private sector
Concluded by:
Name company: →  Mondelez Pakistan Limited
Names trade unions: → 

WORKING HOURS, SCHEDULES AND HOLIDAYS

Paid annual leave: → 21.0 days
Paid annual leave: → 3.0 weeks
Provisions on flexible work arrangements: → No

WAGES

Wages determined by means of pay scales: → No
Adjustment for rising costs of living: → 

Wage increase

Wage increase: → 14.0 %
Wage increase starts: → 2012-05

Once only extra payment

Once only extra payment due to company performance: → Yes

Allowance for seniority

Allowance for seniority: → PKR 15000.0 per month
Allowance for seniority after: → 15 years of service

Meal vouchers

Meal allowances provided: → No
Free legal assistance: → No
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