Pakistan

Hiring guide in Pakistan

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What should I know about hiring in Pakistan?

Hiring in Pakistan requires a thorough understanding of the country’s employment laws, cultural nuances, and workforce dynamics. Employment contracts should clearly define terms such as job responsibilities, compensation, and termination conditions, with both fixed-term and permanent contracts being commonly used. The standard workweek is 48 hours, typically spread over six days, and employees are entitled to overtime pay for any additional hours worked. Minimum wage laws vary by province and industry, making it essential to stay updated on regional regulations. Employers must also comply with leave policies, which include annual leave, sick leave, public holidays, and maternity leave for female employees.

Recruitment channels in Pakistan include online job portals, recruitment agencies, and social media platforms such as LinkedIn. Referrals and local job boards are also widely used. Employers should consider the country’s diverse talent pool, which includes a significant number of skilled professionals in IT, engineering, finance, and healthcare sectors. 

Understanding cultural expectations is important, as employees in Pakistan often value job security, competitive salaries, and opportunities for professional growth. Lastly, ensuring compliance with tax and social security obligations, including contributions to the Employees’ Old-Age Benefits Institution (EOBI) and Social Security Institution, is crucial for smooth and lawful hiring practices.

Why is Pakistan a good choice for finding remote employees?

Pakistan is an excellent choice for finding remote employees due to its vast pool of skilled professionals, competitive labour costs, and growing digital infrastructure. The country boasts a young and dynamic workforce, with a significant portion proficient in English, making communication seamless for international companies. Pakistan has a strong presence in IT, software development, digital marketing, and customer support, with many professionals experienced in working remotely for global organisations.

The cost of hiring in Pakistan is relatively lower compared to other regions, allowing companies to access high-quality talent while maintaining cost efficiency. Moreover, the government’s focus on digital development has improved internet connectivity and remote working capabilities across the country. Cultural adaptability and a strong work ethic are additional strengths of Pakistani professionals, making them ideal for diverse remote roles. By tapping into Pakistan’s talent pool, businesses can enhance their global operations while benefiting from skilled, dedicated, and cost-effective remote employees.

How can Native Teams help you hire in Pakistan?

For a streamlined hiring process in Pakistan, Native Teams provides essential support through our Employer of Record services. Our solutions are crafted to navigate the intricacies of Pakistani employment regulations, cultural norms, business practices, and language considerations. Our team of skilled tax and legal professionals acts as your trusted partner throughout the recruitment journey in Pakistan. We ensure adherence to local payroll requirements, tax obligations, and HR documentation, allowing you to hire and integrate Pakistani talent into your remote team efficiently.


 Hire your first Pakistani employee with Native Teams.


Legal requirements for hiring in Pakistan

Employers must follow a few essential laws and regulations to ensure a fully compliant employment process in Pakistan.

Legal framework

The legal framework governing employment in Pakistan combines constitutional principles, colonial-era laws, and modern regulations. Since independence in 1947, Pakistan has adapted labour laws to address socio-political changes, with key protections enshrined in the Constitution, such as the prohibition of forced and child labour, the freedom to form unions, and non-discrimination based on sex. While the framework is robust, enforcement remains inconsistent due to resource constraints and varying regional implementation.Key laws include the Employees’ Old Age Benefits Act, 1976, providing retirement benefits; the Minimum Wages Ordinance, 1961, ensuring fair pay; and the Factories Act, 1934, regulating health, safety, and working conditions. Other notable laws, such as the Industrial and Commercial Employment Ordinance, 1968, standardise employment terms, and the Employment of Children Act, 1991, prohibits child labour. These laws form the basis of worker protection and employer obligations, but improved enforcement and awareness are needed for their full effectiveness.

Types of employment contracts

In Pakistan, employment contracts are tailored to suit various roles and durations, each with distinct legal and practical implications. These contracts regulate the relationship between employer and employee, outlining job nature, duties, and terms of service. The Constitution of Pakistan and the Standing Orders Ordinance of 1968 mandate a written contract at the start of employment.

The main types of employment contracts include:

  • Permanent contracts: Provide indefinite job security and full benefits such as health insurance and retirement plans.
  • Probationary contracts: Typically last three months, allowing employers to evaluate new employees before offering permanent status.
  • Temporary contracts: Cover specific tasks or limited periods, offering less job security and fewer benefits.
  • Apprenticeships: Focus on skill development in specific trades, with protections ensuring fair treatment.
  • Contract workers: Hired for specific tasks or durations, with terms often varying by region.

These contracts enable flexibility while safeguarding employee rights and employer obligations.

Content of an employment contract

An employment contract in Pakistan must comply with local labour laws and clearly outline the terms and conditions of employment, ensuring mutual understanding and governance of the working relationship between employers and employees. As mandated by the Constitution and the Standing Orders Ordinance of 1968, employers are required to provide a written contract at the start of employment.

The contract should specify the nature of employment (e.g., permanent, probationary, temporary) and include key elements such as:

Job description and responsibilities: Detailed information on the employee’s role, ensuring alignment with the job advertised and discussed during hiring.

Salary: The contract must state the basic and gross salary, including allowances such as house rent and conveyance, ensuring compliance with the minimum wage (Rs. 32,000 per month).

Probationary period: Typically three months, this section should outline evaluation criteria and whether the period can be extended.

Termination of service: Conditions for termination, notice requirements (typically 30 days), and payment in lieu of notice must be explicitly mentioned.

The contract should also address transferability of services, detailing if employees can be reassigned within the organisation. Provisions for confidentiality agreements and non-disclosure clauses should protect company information during and after employment.

Additional clauses should cover leaves, retirement benefits, and medical facilities, ensuring they meet legal or company policy requirements. The contract must specify whether it adheres to general labour laws or industry-specific regulations (e.g., Mines Act, Newspaper Employees Act). Any negotiated terms differing from standard laws should be explicitly outlined, with precedence given to agreed terms while ensuring alignment with applicable labour regulations.

This comprehensive structure not only ensures legal compliance but also fosters transparency and trust between the employer and employee.


Download a free employment contract for Pakistan through Native Teams.


Oral, written or electronic employment contracts

In Pakistan, employment contracts can be oral, written, or electronic, each with distinct legal implications. Oral contracts, while legally valid and commonly used in small businesses or for domestic workers, are less reliable due to the absence of formal documentation, making enforcement challenging in case of disputes.

Written contracts, although not mandatory, are highly recommended for clarity and to prevent misunderstandings. They are widely used in practice and should include key details such as job description, working hours, salary, benefits, and termination conditions. The Standing Orders Ordinance of 1968 mandates that workers receive written documentation outlining their terms of employment when hired, transferred, or promoted. Additionally, permanent employees must be given a written certificate upon termination, layoff, or retirement.

Electronic contracts are also permissible, provided they adhere to legal standards for authenticity, digital signatures, and secure record-keeping. They offer a modern alternative for formalising employment agreements, especially in organisations with digital operations.

For employees covered under specific laws, such as the Industrial and Commercial Employment Standards Ordinance or Special Employment Acts, contracts must comply with statutory benefits and regulations. While oral contracts remain an option, written or electronic agreements are strongly preferred for their reliability and enforceability, ensuring transparency and legal protection for both parties.

Probationary period

The probationary period is a critical phase in employment, allowing both the employer and employee to evaluate their suitability for the role and organisation. Typically lasting three months, as stipulated by various legal frameworks such as the Standing Orders Ordinance of 1968, the Khyber Pakhtunkhwa Industrial and Commercial Employment Act 2013, and the Sindh Terms of Employment Act 2015, this period serves as a trial phase.

During the probationary period, either party can terminate the contract without prior notice or compensation, although employees are entitled to wages for the days worked. Employers use this time to assess an employee’s performance, skills, and cultural fit, while employees evaluate their compatibility with the organisation.

The probationary period can be shortened or excluded altogether if mutually agreed upon in the employment contract, with contractual terms taking precedence over general labour laws. Upon successful completion, the probationary period is considered part of the employee’s continuous service, contributing to their tenure and entitlements. This makes it a valuable phase for both parties to establish a long-term working relationship.

Working hours

In Pakistan, labour laws regulate working hours to ensure fair treatment and prevent exploitation. Under the Factories Act, 1934, the maximum daily working hours for adult employees (18 years and older) are set at nine, with a weekly cap of 48 hours. Female workers are restricted from working beyond 7 pm.

Overtime is permitted under the Factories Act, with a daily limit of 12 hours and a weekly maximum of 56 hours, including overtime. This allows for up to eight hours of overtime per week, or approximately 1 hour and 20 minutes daily. Annually, overtime cannot exceed 624 hours.

Workers are entitled to rest after every five consecutive hours of work, with a minimum one-hour break for meals, rest, and prayer. Employees also receive at least 24 consecutive hours of rest weekly, typically on Sundays, unless negotiated otherwise.

Young workers aged 14 to 17 are limited to 1.5 hours of overtime daily, with an annual cap of 468 hours. Workers can generally be asked to work overtime, though they can refuse for valid reasons.

During Ramadan, working hours are reduced by 2 to 3 hours daily. Workers in physically demanding jobs may have further reduced hours for health and safety reasons.Different sectors have specific regulations. The Factories Act applies to manufacturing industries, the Mines Act to excavation operations, and the Shops and Establishments Ordinance to all establishments. Road transport and newspaper employees are governed by specific ordinances with additional rules on overtime and working conditions.

Breaks and night work

In Pakistan, labour laws regulate both rest breaks and night work to ensure fair working conditions for employees.

Rest Breaks
Employees are entitled to a weekly rest of at least 24 continuous hours, typically on Sundays. Additionally, a rest break of at least one hour must be provided after six consecutive hours of work, ensuring time for meals and relaxation. The timing of breaks may vary depending on local customs and work requirements.

Night Work
Night work is defined under the Factories Act, 1934 as any work performed between 7 p.m. and 6 a.m. According to the Employment of Women Act, 1938, women are generally prohibited from working during these hours, in alignment with ILO Convention 89. However, pregnant women may be exempt from this restriction for up to 16 weeks, provided they present a medical certificate. In line with ILO Convention 171, employers are required to offer alternative arrangements for pregnant women working night shifts.

Annual leave

Employees in Pakistan are entitled to 14 calendar days of paid annual leave after completing 12 months of continuous service, as per Section 49-B of the Factories Act. This leave is intended to provide personal time off and must be taken consecutively, without splitting.

Employees may carry forward unused annual leave up to a maximum of 14 days, enabling a total of 28–30 days of leave in a subsequent year. Alternatively, employees can request payment in lieu of unused leave. Leave pay is calculated based on the average daily wage of the previous three months, with employers required to pay half of the leave pay before the leave period begins. Non-compliance can be reported to labour authorities, who may assist in recovering dues.

Certain conditions can impact eligibility, such as extended sickness, unauthorized absences, participation in illegal strikes, or prolonged periods of involuntary unemployment exceeding 30 days. Temporary and contract workers generally do not qualify for annual leave, although they are entitled to unpaid weekly and public holidays. For part-time workers, leave entitlements are typically determined by company policies.

Specific rules apply to different labour categories:

  • Mineworkers: Receive one day of leave for every 17 days worked underground and one day for every 20 days worked above ground, with a maximum of 20 accumulated days. Leave can be taken in parts.
  • Newspaper Employees: Entitled to leave equal to at least 1/11th of the time spent on duty, under the Newspaper Employees Act.

Road Transport Workers: Receive 14 days of paid leave after 12 months of service or 7 days after six months, under the Road Transport Workers Ordinance.

Holidays

Public holidays in Pakistan comprise religious and memorial observances, entitling workers to paid leave on these occasions. Employers are required to grant holidays with pay on all officially declared public and festival holidays, as well as on weekly rest days. If a public holiday coincides with a Sunday, no substitute holiday is provided.

Categories of public holidays:

Religious holidays
These include significant Islamic festivals such as Eid Milad-un-Nabi, Eid ul Fitr, Eid ul Azha, and Ashura. Dates are determined by lunar sightings and may vary annually.

Memorial holidays
These commemorate national events like Kashmir Day, Pakistan Day, Labour Day, Independence Day, Iqbal Day, and Quaid-e-Azam Day.

Public/Festival and State Holidays for 2024:

  • February 5: Kashmir Solidarity Day
  • March 23: Pakistan Day
  • April 10–12: Eid ul Fitr
  • May 1: Labour Day
  • June 17–19: Eid ul Azha
  • July 16–17: Ashura (Muharram)
  • August 14: Independence Day
  • September 16: Eid Milad-un-Nabi
  • November 9: Iqbal Day
  • December 25: Quaid-e-Azam Day / Christmas

Optional holidays

The Ministry of Interior and provincial governments announce optional holidays for specific religious communities, totalling approximately 14 days. These are observed by Muslims, Christians, Hindus, Sikhs, Parsis, Buddhists, and Bahá’ís, with dates specific to their traditions.

Examples of optional holidays:

  • Muslim holidays: Shab-e-Miraj, Shab-e-Barat, and Chehlum
  • Christian holidays: Good Friday, Easter, and Day after Christmas
  • Hindu holidays: Holi, Diwali, and Janam Ashtami
  • Sikh holidays: Baisakhi and Guru Nanak’s Birthday
  • Parsi holidays: Parsi New Year and Birthday of Lord Zoroaster

Work on a public holiday

If an employee is required to work on a public holiday and no substitute holiday is provided, they must be compensated at three times (300%) their regular pay rate.

Employers are advised to ensure compliance with these provisions to maintain fair labour practices and avoid disputes.

Wages and contributions

In Pakistan, the payment of timely and fair wages is a fundamental right safeguarded by labour laws. The current minimum wage in 2024 is Rs37,000 for Pakistan.

Wages include various forms of monetary compensation but exclude social insurance contributions, travel allowances, and other specific payments. They can be paid in cash or other benefits and calculated on a yearly, monthly, weekly, daily, hourly, or piece-rate basis. Employers must pay employees with annual or monthly salaries at least once a month, and wages in factories or establishments with fewer than 1,000 employees must be paid within seven days of the end of the wage period. 

For larger establishments, the payment deadline extends to ten days, and all payments must be made in cash or currency notes on a working day, as cheques are not permitted. Employees working beyond standard hours (eight hours per day or 48 hours per week) are entitled to overtime pay at double the regular hourly rate, while those working on public holidays must be compensated at 300% of their standard wages and granted a substitute paid holiday and compensatory leave.


To calculate the salary and taxes in Pakistan, click here.


Sick leave

In Pakistan, sick leave ensures employees receive paid leave and job security during illness, with entitlements varying by sector and severity. Public sector employees contributing to social security for 90 days are eligible for sickness benefits, including full wages for up to 365 days for severe illnesses like cancer and tuberculosis. In Khyber Pakhtunkhwa and Balochistan, this is capped at 50% of wages, with 75% coverage for other illnesses for up to 121 days.

Private sector employees are entitled to 10 days of sick leave without hospitalisation and an additional 30 days if hospitalised. For prolonged illnesses, workers may receive up to six months of full-pay sick leave, six months at half-pay, and six unpaid months, subject to medical certification. Beyond leave, insured workers access medical care, medicines, hospitalisation, and maternity services. Employers cannot dismiss or penalise employees during illness, injury, or maternity care. Pakistan also provides work injury benefits, including compensation for incapacity or death, ensuring comprehensive support for workers’ health and welfare.

Parental and maternity leave

In Pakistan, the legal framework for parental leave exhibits gaps, with maternity leave being the most established and widely accessible form. Female employees are entitled to up to 12 weeks of maternity leave under the West Pakistan Maternity Benefit Ordinance, 1958, including six weeks of compulsory post-natal leave. Public sector employees are granted 90 days of maternity leave with full pay. To qualify, women must have been employed for at least four months before their expected delivery date and are entitled to free medical care during pregnancy and postpartum.

Paternity leave provisions are less consistent. While there is no legal mandate for paternity leave in the private sector, certain public sector entities provide options. In Punjab, the Revised Leave Rules of 1981 offer seven days of paternity leave, limited to two uses during a father’s service. Additionally, under the 2018 National Commission on the Status of Women Employees Rules, male public servants are granted 10 days of fully paid paternity leave. Similarly, Sindh Police allows 10 days of paternity leave, which can be taken before or after the child’s birth.

Termination of the employment relationship

In Pakistan, employment termination can occur through notice-based termination, misconduct, redundancy, automatic termination, resignation, employer-initiated termination, or mutual agreement. Notice or payment in lieu is required for non-misconduct terminations, while redundancies must follow legal protocols, including re-employment offers within a year if positions reopen. Misconduct-related dismissals require a fair inquiry, though immediate termination is allowed for severe violations. Automatic termination applies to fixed-term contracts, project completion, or death, while resignations and mutual agreements rely on employee or mutual consent.

Disciplinary actions for misconduct include fines, demotions, delayed promotions, or termination. Misconduct includes insubordination, dishonesty, lateness, or unlawful strikes. Employers must follow a structured process, including reporting, inquiries, and fair assessments, before imposing penalties.

Ordinary dismissal by employer

Ordinary dismissal in Pakistan requires employers to follow statutory notice periods or provide pay in lieu, comply with protected employee procedures, and meet severance or gratuity obligations. Governed by the Industrial Relations Ordinance (IRO) 2002, dismissals for employees under ICESOs mandate a written termination order stating the reason for dismissal. While the law requires reasons to be specified, acceptable grounds such as serious illness or job inefficiency are defined through case law. Employers generally need not notify government authorities unless specified by contract or redundancy requirements.

Arbitrary dismissal, though not explicitly defined in law, is considered unjustified if unrelated to work performance or due to discriminatory reasons like pregnancy or complaints to authorities. Disputes are addressed through Arbitration Boards, Special Courts, or Tribunals, with appeals directed to Labour or High Courts. If industrial disputes arise, conciliation and arbitration processes aim to resolve issues. Agreements reached through conciliation are reported to the Government, while arbitration awards are binding for two years and published in the Official Gazette.

Notice period and challenging the dismissal

In Pakistan, employees are entitled to one month’s notice or pay in lieu of notice for termination of employment. This rule applies only to permanent employees, while temporary workers and probationers are excluded. If the contract specifies a longer notice period, those terms prevail. Fixed-term contracts may also have unique termination clauses. Employees must provide 30 days’ notice if they terminate the contract. If notice is not given, compensation in the form of one month’s wages is required.

Employees can challenge unfair dismissals through the Ministry of Labour or Labour Courts. If an employee feels they were wrongfully dismissed or not given proper notice, they may file a complaint with the Ministry, which will attempt mediation. If mediation fails, the employee can proceed to Labour Courts. A grievance can be submitted to the employer in writing within one month, and the employer must respond within 15 days. If the response is unsatisfactory, the employee can take the matter to court within two months.

Labour Courts handle unfair termination, wage disputes, and contract violations, while arbitration offers a less formal alternative for complex or specialised disputes. Arbitration can be used for collective bargaining, contract interpretation, or multi-party cases, with the resulting decision typically final and binding.

Rights and obligations of unemployed individuals

In Pakistan, unemployed individuals have certain rights and obligations, though formal unemployment benefits are not widely available. Key rights and obligations include:

  1. Right to fair treatment: Unemployed individuals are entitled to protection against discrimination and unfair treatment during the job search process. Employers must not discriminate based on gender, race, or disability.
  2. Right to legal redress: Individuals can challenge unfair dismissals or violations of employment terms through the Ministry of Labour or Labour Courts. They have the right to contest grievances related to employment contracts or conditions.
  3. Unemployment benefits: Pakistan does not have a formal unemployment insurance system for individuals who lose their jobs. However, certain social security programs may provide limited benefits, such as healthcare or pensions, depending on prior employment.
  4. Obligation to seek employment: Unemployed individuals are expected to actively seek employment, particularly if they are part of any government-supported employment programs.
  5. Obligation to update employment records: Those receiving government assistance or social security benefits must regularly update their employment status and provide necessary documentation.
  6. Training and skill development: While not a legal requirement, unemployed individuals may be encouraged or obliged to undergo skills training or attend job placement programs to improve their employability.
  7. Obligation to comply with Social Security requirements: If previously enrolled in a Social Security program, unemployed individuals must comply with regulations and continue making contributions, if applicable, to maintain access to certain benefits.

The government and employers may provide support through job placement services, training, and, in some cases, limited financial assistance, but these provisions are typically more accessible for those who have been formally employed in certain sectors or regions.

Severance pay

In Pakistan, severance pay is a financial compensation given to employees upon termination of their employment, except in cases of misconduct. It is typically calculated as 30 days’ wages for each year of completed service or a proportionate amount for periods exceeding six months. The entitlement to severance pay is governed by the Standing Orders Ordinance, 1968, and similar regional acts, with claims to be filed within three years if payment issues arise. Severance pay is based on an employee’s gross wages, excluding irregular payments like bonuses.

Employees with at least one year of service are also entitled to “End-of-Service Gratuity Pay,” which is calculated similarly to severance pay, as 30 days’ wages per year of service. However, employees dismissed for misconduct are ineligible for gratuity. In cases of death, gratuity is paid to the employee’s legal dependents. Like severance pay, gratuity is based on gross wages, excluding irregular payments. If there are disputes or delays, employees can file complaints with the Workmen Compensation Commissioner within three years. Severance and gratuity pay serve different purposes—severance compensates employees after termination, while gratuity is a statutory benefit for services rendered.

Probationary period

The probationary period in Pakistan typically lasts for three months, as specified by various legal frameworks, including the Standing Orders Ordinance of 1968, the Khyber Pakhtunkhwa Industrial and Commercial Employment Act 2013, and the Sindh Terms of Employment Act 2015. During this time, either party can terminate the employment contract without prior notice or compensation, although employees are entitled to wages for the days worked. The probation period serves as a trial phase for both the employer to evaluate the employee’s performance and for the employee to assess the fit within the organisation.

Employers and employees can agree to a shorter probationary period or even exclude it from the contract. If the contract terms differ from general labour laws, the contract’s provisions will take precedence. Once the probationary period is successfully completed, it is considered part of the employee’s continuous service, contributing to their overall tenure and entitlements.

Intellectual property rights

In Pakistan, intellectual property (IP) rights are protected by key laws, including the Copyright Ordinance 1962, Patent Ordinance 2000, and Trade Marks Ordinance 2001.

Copyright protects creative works like books and music automatically upon creation, though registration can provide stronger legal backing.
Patents cover inventions and last for 20 years, provided the invention is new, useful, and non-obvious.
Trademarks are renewable and protect symbols, names, and logos for ten years.

Pakistan is a part of international treaties like the Berne and Paris Conventions, ensuring global protection.

However, IP enforcement remains a challenge due to a lack of awareness and trained professionals. The Intellectual Property Organization of Pakistan (IPO-Pakistan) addresses these issues by promoting awareness and improving enforcement.

Employee data privacy

In Pakistan, data privacy is primarily protected by the Penal Code, which criminalises unauthorised use or disclosure of personal data. The Personal Data Protection Bill strengthens these protections, requiring data handlers to follow strict rules for collecting, storing, using, and destroying personal data.

Key definitions in the bill include:

  • Data controller: The entity that decides how personal data is handled.
  • Data processor: The entity that processes data on behalf of the controller.
  • Personal data: Information that identifies an individual, including sensitive financial, biometric, or health information.

Sensitive personal data is subject to stricter protections, requiring data controllers to be registered and licensed. It also mandates that critical personal data be stored within Pakistan, with restrictions on its transfer outside the country.

The bill guarantees individuals rights such as access to their data, correction, and erasure. Additionally, data controllers must notify breaches within 72 hours and maintain records of all data-related activities to ensure compliance and protect data from misuse.

Prohibition of competition

The probationary period in Pakistan typically lasts for three months, as specified by various legal frameworks, including the Standing Orders Ordinance of 1968, the Khyber Pakhtunkhwa Industrial and Commercial Employment Act 2013, and the Sindh Terms of Employment Act 2015. During this time, either party can terminate the employment contract without prior notice or compensation, although employees are entitled to wages for the days worked. The probation period serves as a trial phase for both the employer to evaluate the employee’s performance and for the employee to assess the fit within the organisation.

Employers and employees can agree to a shorter probationary period or even exclude it from the contract. If the contract terms differ from general labour laws, the contract’s provisions will take precedence. Once the probationary period is successfully completed, it is considered part of the employee’s continuous service, contributing to their overall tenure and entitlements.

Remote working policy

In Pakistan, new laws in Sindh, Punjab, Khyber Pakhtunkhwa, and Balochistan provide home-based workers with rights and benefits similar to those of office workers.

National policy on home-based workers: This policy defines home-based workers as individuals who work from their own home or a location of their choice, receive payment for their work, and may be self-employed or contract workers. However, it excludes employees primarily working at a regular workplace, self-employed workers with significant autonomy, domestic workers, and unpaid agricultural helpers.

Sindh: The Sindh Home-Based Workers Act 2018 offers protections for workers in the province, including entitlement to social security, medical care, maternity leave, and compensation for marriage and death. The Act also establishes a Council to oversee the registration of home-based workers and their employers, ensuring proper wage payments and dispute resolution through an Arbitration Committee.

Punjab: The Punjab Home-Based Workers Act 2023 provides a broader definition of home-based work, covering both goods and service production. It sets key rights for home-based workers, such as written employment contracts, fair wages, and safe working conditions. The Act also creates a Welfare Fund, supported by contributions from the government, employers, and workers, to support various initiatives and resolve disputes. Additionally, it restricts child labour and requires fair treatment of workers.

These laws aim to ensure fair treatment, financial security, and proper regulation of home-based work in Pakistan.

Responsibilities within a remote work arrangement

In Pakistan, home-based workers have specific rights and protections within remote work arrangements, ensuring fair treatment and support.

Employer responsibilities: Employers, including contractors and intermediaries, are required to pay wages in full and maintain proper records, which must be submitted to the Labour Department or the Home-Based Workers Council. Employers are also obligated to provide mandated benefits such as social, medical, and maternity benefits, in line with relevant legislation.

Home-based workers council: The Council oversees the registration and monitoring of home-based workers and employers. It ensures compliance with regulations, maintains detailed records, and plays a crucial role in tracking workers across sectors to protect their rights.

National policy: The policy ensures that home-based workers receive fair compensation and benefits comparable to office workers. It also supports economic advancement by providing access to skills training, credit, and land ownership, alongside social security benefits for those who contribute to the Employees Old Age Benefits Institution (EoBI).Union rights: Home-based workers have the right to form unions and engage in collective bargaining to advocate for improved working conditions. HomeNet Pakistan is a key national network dedicated to supporting home-based workers and promoting legislation that protects their rights. The Constitution of Pakistan guarantees the right to join unions, strengthening workers’ ability to negotiate for better terms and conditions.

Health and safety at home

In Pakistan, while there is no specific remote work legislation, existing labour laws offer a framework for ensuring health and safety standards for home-based workers.

Employer responsibilities: Employers must provide clear instructions and training to home-based workers regarding job-related hazards and safety protocols. They are required to ensure a safe work environment by following health and safety regulations and providing access to secure work areas. Additionally, employers should ensure that workers have access to necessary equipment or provide reimbursements for work-related technological expenses through formal agreements.

Workplace safety and rights: Employees working remotely are entitled to the same rights and protections as office workers, including social security benefits and the right to be registered as home-based workers. Employers must actively ensure that their remote work setups adhere to health and safety standards, safeguarding workers’ physical well-being.

Mental and physical health: Employers should encourage ergonomic home office setups to avoid health issues and provide support to employees to ensure they maintain good mental and physical health. Promoting mental well-being through resources to prevent social isolation is also crucial for remote employees.

By following these guidelines, employers can ensure that their remote work practices align with existing labour laws, promoting a safe, healthy, and productive environment for home-based workers.

What are the advantages of hiring employees from Pakistan vs other countries?

Hiring employees from Pakistan offers numerous advantages, particularly in terms of cost, talent, and operational efficiency. Salaries in Pakistan are significantly lower than those in many developed countries, making it an attractive option for businesses aiming to reduce labour costs while still receiving high-quality work. 

Despite the more affordable wage structure, Pakistan has a well-educated and skilled workforce, especially in IT, software development, engineering, finance, and customer service sectors. Many professionals in Pakistan are proficient in English, especially in major cities, which facilitates clear communication and effective collaboration with international teams. 

The country’s strategic location and time zone further enhance its appeal, providing businesses with the opportunity for extended working hours and real-time communication with teams worldwide. 

Furthermore, Pakistan’s growing tech industry and expanding digital infrastructure create an environment conducive to remote work, allowing businesses to access a global talent pool. Overall, hiring from Pakistan enables companies to tap into a talented, cost-effective workforce that can help drive business growth and maintain high standards of quality and performance.

Why use Native Teams for hiring in Pakistan?

Native Teams lets you employ team members “like a local”, meaning you get all the benefits of a global team wherever you are based. Here are the reasons why you should use Native Teams for hiring:

  • No paperwork: We will handle all the necessary paperwork for you.
  • Save on taxes: We help you handle your taxes.
  • No company set up: You can expand your business using our company entitles.
  • Online onboarding: We’re here to ensure your onboarding process is trouble-free.
  • No accounting: We will handle all your accounting needs, including invoicing, payroll, and more.
  • Increase your profit: We assist you in growing your business and maximising your profits.
  • Compliance expertise: we can assist your company in navigating the regulatory environments and ensure you meet all relevant requirements.
  • Local support: We can assist you in understanding and complying with the relevant local laws.

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*Note: The provided information was accurate at the time of writing.

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