Employee Benefits in Pakistan

Pakistan’s labor laws mandate various benefits to promote employee welfare and security, ensuring their financial and personal well-being:

Legally Required Benefits

1. Social Security Coverage:

Employers must contribute to a government-administered fund that supports employees with medical care, disability benefits, and maternity coverage.

2. Retirement Benefits (EOBI):

Contributions to the Employees’ Old-Age Benefits Institution guarantee pensions, invalidity support, or survivor benefits for registered employees.

3. Workplace Accident Coverage:

Under workers’ compensation laws, employers are obligated to cover medical treatment and income replacement for injuries incurred on the job.

Supplementary Perks

To stay competitive, many employers provide additional advantages:

1. Health Coverage:

Group medical insurance plans, including family benefits, are increasingly offered.

2. Retirement Savings:

Options like gratuity or provident funds allow employees to accumulate savings or receive lump-sum payments upon retirement.

3. Family-Friendly Policies:

Flexible hours, childcare subsidies, and remote work opportunities foster employee satisfaction and retention.

By providing these benefits, organizations not only comply with laws but also create a supportive work environment.

Leave Policies for Employees in Pakistan

Labor laws in Pakistan outline several types of leave to accommodate employees’ personal and professional needs, ensuring work-life balance and health:

1. Annual Leave

Employees are entitled to 14 days of paid annual leave after completing 12 months of continuous service. Unused leave can be carried forward to the following year, with a maximum accumulation of 28 days.

2. Casual Leave

Workers are granted 10 days of casual leave annually, typically for personal emergencies or short-term needs. This leave is fully paid.

3. Sick Leave

Sick leave entitlements vary by province:

- 16 days with half-pay under the Factories Act.

- 10 days with full pay in certain industries governed by the Shops and Establishments Ordinance.

4. Special Leave

Hajj Leave: Muslim employees can take leave to perform the pilgrimage to Mecca.

Maternity Leave: Female employees are entitled to paid leave before and after childbirth, as per national and provincial regulations.

These leave policies reflect the commitment to supporting employees’ physical and mental well-being.

Working Hours and Overtime Policies

Pakistan’s labor laws focus on ensuring fair working hours and proper compensation for extra time worked:

Standard Working Hours

- The maximum weekly limit is 48 hours, usually spread across six days.

- Daily shifts cannot exceed 9 hours, with a compulsory 1-hour break after every 5 consecutive hours of work.

Overtime Work

- Overtime hours are capped at 12 per day and 56 per week.

- Overtime pay must be at twice the regular hourly rate, with triple rates applicable for certain holiday shifts.

Additional Regulations

Night Work:

Women are typically not permitted to work between 7 PM and 6 AM unless exceptions are granted.

Weekly Day Off:

Employees are entitled to at least 24 consecutive hours of rest weekly. Work performed on rest days qualifies for overtime pay.

By regulating working hours and enforcing fair pay for overtime, these policies protect employees’ health while ensuring equitable compensation for additional effort.