The Labour Law in Pakistan

In Pakistan, labour law governs the rights of workers in a complex and intricate manner. The law protects the rights of workers, including their right to fair wages, safe working conditions, and collective bargaining. As a part of labour law, minimum wages are set, overtime hours are defined, and discrimination is prohibited at work. An experienced labour lawyer can help you if you have questions about your rights or if you have been injured at work in Pakistan.

Labour Law in Pakistan

The Pakistani Labour Law

Pakistan’s Labour Law regulates the rights and duties of employees, employers, unions, and labour inspectors. Workers’ rights to freedom of association, collective bargaining, and strike, as well as their right to a safe and healthy workplace, are protected by law.

 

It also specifies minimum standards for pay and employment conditions, including work hours, holidays, maternity leave, and sick leave. Labor Departments are responsible for enforcing these provisions, but enforcement often lapses.

 

Despite the absence of a specific retirement age in the Labour Law, employees are entitled to pension benefits at 55. Moreover, employers must contribute to employee benefit schemes, such as provident funds.

Pakistan’s Joint Labour Law

Pakistan has one of the most comprehensive labour laws in the region. Among the areas covered by the law are minimum wages, hourly wages, overtime pay, protection of workers’ rights, and social security. Workers who are injured or become ill on the job are also entitled to severance pay and insurance benefits.

 

Since 1948, the Labour Law has been amended several times. In 2013, a significant amendment to the country’s labour laws was adopted. Among the key provisions are:

– Minimum wage increased from Rs 1,250 to Rs 2,000 per month

– Overtime pay is now mandatory at 100% of normal salary for work over 8 hours a day or 40 hours a week, up from 50%

– Union membership has been guaranteed

– Under labour law, sexual harassment is protected as a protected category

The International Labour Organization

The International Labour Organization (ILO) is responsible for protecting the rights of workers around the world. Over 190 countries are members of the organization, which was founded in 1919. Workers’ rights to earn a living, enjoy safe and healthy work, form and join unions, and have their concerns heard on labour-related matters are the main objectives of the ILO.

 

Labour law in Pakistan is administered by the Ministry of Labour. As part of its mandate, the Ministry protects workers’ rights, promotes collective bargaining, resolves disputes between employers and workers, develops regulations regarding employment conditions, improves working conditions for vulnerable workers, such as women and children, and enforces labour laws. In addition, the Ministry oversees social security schemes for employees, including unemployment insurance and health benefits.

Practice of Labour Law in Pakistan

The labour law in Pakistan is a complex system with a variety of laws and regulations. Labour law in Pakistan is governed by the Constitution and the Labour Act, of 1948 (as amended from time to time). Pakistan’s labour laws are governed primarily by the 1948 Labour Act, which covers all aspects of labour relations. Several subsidiary statutes address specific topics such as minimum wage, overtime pay, child labour, etc. The Labor Act of 1948 is implemented and enforced by the Labour Department.

Ordinances, Acts, Rules, Regulations, and other statutes relating to Industrial, Commercial, and Labour Establishments are widely scattered and inaccessible under Pakistani labour law. In accordance with these laws, employers, employees, trade unions, and the concerned agencies can realize their respective responsibilities and become aware of their legal rights. It is the goal of these laws to achieve higher productivity, reasonable profits, and better wages as well as protect workers from exploitation.

Pakistan’s labour laws date back to the pre-partition era, which formed the basis for the country’s policy-making and labour laws. Trade union activities were allowed in all sectors, and workers had the right to collective bargaining. Pakistan’s Constitution specifies the following labour laws:

Labour Law in Pakistan

PAKISTAN'S CONSTITUTION: LABOUR LAWS

Labour rights are covered in Part II of Pakistan’s Constitution.

  • Article 11 of the Constitution prohibits slavery, forced labour, and child labour.

  • The right to form unions and to freely associate is a fundamental right protected by Article 17.

  • Article 18 prohibits its citizens from engaging in any lawful profession or occupation or conducting any lawful trade or business.
  • Article 25 enshrines a right to equality before the law as well as a prohibition on discrimination based solely on gender.
  • According to Article 37(e), women in employment are guaranteed just and humane conditions of employment, as well as maternity benefits.

ANNUAL LEAVE AND HOLIDAYS

An employee is entitled to 14 calendar days of paid annual leave after 12 months of continuous service. The Factories Act, Section 49-B.

PAID HOLIDAYS

Public and religious festivals are paid holidays for workers. According to Section 49-I of the Factories Act, the Ministry of Interior, Islamabad, and the Provincial Government announce festival holidays at the beginning of the calendar year (usually 14 in number).

WEEKLY REST DAYS

Each worker is entitled to one day of rest per week (24 consecutive hours). Sunday is usually the day of rest for the week. If he is on holiday, he cannot be forced to work consecutively for 10 days without receiving a compensatory holiday of one full day. (See Section 35 of the Factories Act).

BONDED LABOUR IN PAKISTAN

Bonded labour is considered similar to slavery due to the obligations attached to the debt. In many cases, creditors artificially inflate the amount of the debt by adding excessive interest and deducting little or nothing from the actual amount. In addition to violent threats, the creditor also uses instruments of obligation to coerce repayment. Costs such as housing, clothing, and food are added to the debt, which grows over time, making the bondage last a lifetime.

Fundamental rights guaranteed by the Constitution of the Islamic Republic of Pakistan are violated by the Bondage System. The right to freedom of movement (Article 15), the right to assembly (Article 16), the right to association (Article 17), the right to the profession (Article 18), the right to freedom of speech (Article 19), and the right to be an equal citizen (Article 25) are all taken away by being kept under Bonded Labour.

According to Article 11(3) of the Pakistani Constitution, forced labour is prohibited. In order to combat the Bonded Labour System, the following laws have been passed:

  • The Bonded Labour System (Abolition) Act was passed in 1992

  • The Bonded Labour System (Abolition) Rules were passed in 1995

 

  • The Sindh Bonded Labour System (Abolition) Act was passed in 2015

  • The Khyber Pakhtunkhwa Bonded Labour System (Abolition) Act was passed in 2015

 

  • Punjab Bonded Labour System (Abolition) Act, 1992 (Amendment, 2012)

  • The Gilgit-Baltistan Bonded/Forced Labour System (Abolition) Act was introduced in 2020.

  • In 2016, the Punjab Prohibition of Child Labour at Brick Kilns Act was passed
  • 2018 Act to prevent human trafficking
  • Pakistan’s Penal Code, 1860

Labour compensation system

OVERTIME COMPENSATION

According to Section 47 of the Factories Act, 1934, if a worker works beyond the stipulated working hours, he is entitled to double his normal salary (200% of the normal wage rate). It is possible for seasonal factory workers to work up to 56 hours per week.

NIGHT WORK COMPENSATION

There is no special pay premium for overnight workers.

SEXUAL HARASSMENT AT WORK

Under the Protection Against Harassment of Women at Workplace Act, 2010, sexual harassment of workers is prohibited and punishable. An individual convicted of sexual harassment can be imprisoned for a maximum of three years, fined PKR 5 lakh (0.5 million), or both. Section 509 of the Code of Criminal Procedure, 1898.

LABOR SAFETY & HEALTH

AN OWNER WHO IS CAREFUL

Chapter 3 of the Factories Act requires a safe and healthy working environment. In accordance with Section 13-33Q

FREE PROTECTION

The Labor Protection Policy 2006 directs enterprises to provide workers with protective clothing and equipment. There is no specific provision in the law regarding the provision of protective clothing. Further, workers must be vaccinated and inoculated under the 1934 Factories Act (Section 23-A).

Process of training

As a result of the Factories Act, employers are required to provide employees with instruction, training, and supervision to ensure their health and safety at work. In accordance with Section 38

LABOR INSPECTION SYSTEM

An independent labour inspection system is provided by the country’s labour laws. However, there is no central inspection authority and the inspection system is provincial.

Labour Law in Pakistan

SOCIAL NETWORK SECURITY

PENSION RIGHTS

In accordance with social security laws, both full and partial/early pensions are available. To qualify for a full pension, a worker must be 60 years old (55 years for women) with at least 15 years of contributions. The pension is reduced for those who have at least 15 years of contributions and are between the ages of 55 and 59 (men) or 50 and 54 (women). An old-age pension is calculated by multiplying 2% of a worker’s average monthly earnings over the last 12 months by the number of years he or she has contributed. Each month that a full pension is taken before retirement age reduces it by 0.5% (i.e., a worker who takes a pension after 55 gets only 70% of the full pension). If a worker does not qualify for a full or partial pension, he or she may qualify for an old-age grant. EOBI’s minimum monthly pension has been raised from Rs. 3,600 to Rs. 5,250 since 1 April 2015. (In accordance with Section 22 of the Employees’ Old Age Benefits Act of 1976)

DEPENDENTS / SURVIVORS’ BENEFITS

Social Security provides survivors benefits (including widows, widowers, and children). When the deceased worker died, he or she must have been a pensioner. Spouses receive 100% of the deceased’s minimum pension. If their spouses are deceased, orphans receive this benefit. This pension is paid to the deceased’s parents up to five years after the worker’s death if there are no spouses or orphans. As of 1 April 2015, the minimum monthly pension from EOBI has been raised from Rs. 3,600 to Rs. 5,250. (Employees’ Old Age Benefits Act, 1976, Section 22-B)

INVALIDITY BENEFITS

The above acts cover non-occupational accidents/injuries/diseases resulting in permanent invalidity. If a worker has experienced a 67% loss in earning capacity, 2% of the average monthly earnings in the last 12 months multiplied by the number of years of covered employment is paid. Since April 1, 2015, EOBI’s minimum monthly pension has been raised from Rs. 3,600 to Rs. 5,250. Section 23 of the Employees Old Age Benefits Act, 1976.

A CHILD LABOR 

According to Article 11 of the Constitution of the Islamic Republic of Pakistan, children under the age of fourteen may not work in factories, mines, or other hazardous jobs. As education plays a crucial role in eradicating child labour, Article 25-A was added to the Constitution under the 18th Constitutional Amendment 2010, requiring the state to provide free and compulsory education for children aged five to sixteen. A key method for controlling and combating child labor is education.

The Employment of Children Act 1991 and Rules 1995, as well as the Children (Pledging) of Labour Act and Employment of Children Rules, have been implemented to curb this practice.

DOMESTIC SECTOR

WHO ARE THE DOMESTIC WORKERS?

A domestic worker works in or for another person’s home. To qualify as a domestic worker, an individual must be engaged in domestic work in an employment relationship. Domestic workers in Pakistan do not have specific rights, but the new ILO convention provides them.

ILO CONVENTION ON THE RIGHTS OF DOMESTIC WORKERS

Domestic workers must be given the same rights as other workers under the new convention. In addition, it requires:

  • Domestic workers are informed of their employment conditions through written contracts.
  • Domestic workers, who work only normal hours (48 hours a week in Pakistan), receive overtime compensation, rest periods, and annual paid leave.
  • There is adherence to the minimum wage and age regulations of a country.
  • Wages may only be paid in kind to a limited extent. Cash is to be paid for wages.

LABOUR EQUALITY

EQUITY IN PAY

In accordance with section 15 of the West Pakistan Minimum Wage Rules, 1962, wages will be fixed on the basis of equal remuneration for equal work. As there is no specific law in the country dealing with equal remuneration, the federal government is working on a draft of a provincial anti-discrimination law.

A PROFESSIONAL’S CHOICE IS EQUAL

According to the Factory Act, 1934, women cannot work in the same industries as men. In addition, section 27 of the Pakistani Constitution 2010 also provides for gender-based occupational segregation by stating that “specified posts or services may be reserved for either sex if they require performing duties and functions that cannot be adequately performed by members of either sex.”

Labour Law in Pakistan

THE WORK-MATERNITY BALANCE

MATERNITY LEAVE

A maximum of twelve weeks (or three months) of maternity leave with full pay is available to employees. The post-natal leave requirement is six weeks. (West Pakistan Maternity Benefit Ordinance, 1958, Section 4) Public sector maternity leave is also 90 days (3 months), and wages are paid during this period.

Income

The full amount of maternity leave is paid. To qualify, a woman must have worked in enterprise for at least four months prior to delivery. (Section 4 of the West Pakistan Maternity Benefit Ordinance, 1958)

FREE MEDICAL CARE

Section 38 of The Provincial Employees Social Security Ordinance, 1965 provides prenatal confinement and postnatal medical care for women entitled to maternity benefits under section 36.

TRADE UNIONS

UNION RIGHTS

Workers and employers have the right to form unions and to associate freely under the Constitution and Labour Law. (Industrial Relations Act 2012, Section 3). Article 17 of the Constitution also guarantees freedom of association, subject to reasonable restrictions imposed by law in the interests of Pakistan’s sovereignty or integrity, public order and morality. IRA 2012 contains many exclusions that prevent workers from joining unions and forming them.

FREEDOM OF COLLECTIVE BARGAINING

In accordance with Section 19 of the Industrial Relations Act, 2012, employees can bargain collectively through their representatives.

OUR LAW FIRM'S SERVICES

In industries with unions, such as law enforcement and education, we represent clients. We frequently handle collective bargaining, union creation, and union-management negotiations. In addition, we handle legal disputes through litigation or out-of-court settlements such as arbitration. We can also serve as hearing officers in cases of contested representation.