Pakistan
Introduction
General overview & country facts, as well as labour regulations.
Employer Contributions
These are additional costs incurred by employers over and above the employee’s monthly gross salary and/or bonus.
Employee Contributions
These are costs incurred by employees that reduce their monthly gross salary and/or bonus to determine their net “take home” pay.
Employment Terms
All you need to know about salary & bonuses, working hours & overtime, probation period, notice period & severance pay, as well as all leave types.
COUNTRY PLAYBOOK
Pakistan
Everything you need to know about payroll, benefits & hiring top talent in Pakistan
Currency
Pakistani Rupee (PKR)
Salary payment frequency
Bi-monthly / Monthly
Capital
Islamabad
Time Zone
UTC+05:00
Official Languages
Urdu and English
Is English spoken?
Yes
Quick Links
Introduction
General Overview & Economic Facts
- Pakistan is known for its rich and significant agricultural sector. The country’s main export sectors include textiles and garments, leather goods as well as rice.
- Pakistan is classified as a developing economy. It is the 23rd-largest in terms of GDP based on purchasing power parity (PPP).
Why Employ In Pakistan?
- Textiles and garments, agriculture and agribusiness, manufacturing, Information technology (IT) and Software Development.
- Pakistan has both private and public sectors within its education system. The education system faces various challenges such as low literacy rate and inadequate infrastructure, however the government are currently working at putting various measures in place to improve the overall performance of the system.
- Pakistan has a predominantly young population. Pakistan benefits from a sizeable pool of potential employees due to its predominantly young population.
Overview Of The Labour Law
- Pakistan is renowned for its abundant natural resources, encompassing valuable commodities like copper, gold, iron ore, salt, as well as essential agricultural staples such as rice and wheat.
- The labor law in Pakistan is a product of continuous evolution and amendments based on social, economic, and political factors. It is specifically constructed to meet the needs and concerns of both employees and employers. The law encompasses various provisions such as the right of employees to sick leave and safe working conditions which aim to safeguard the wellbeing and welfare of employees.
- The commitment of the government of Pakistan to protecting workers’ rights plays a critical role in formulating and enforcing labor laws, ensuring compliance, and creating a favorable environment for workers.
Fun Country Facts
- Mohenjo-daro, an ancient city in Pakistan provides valuable insights into advanced urban planning and culture of the Indus Valley Civilization.
- Pakistan’s national sport is field hockey, and the country has earned multiple Olympic gold medals.
- Pakistan is the fourth largest producer of cotton in the world which makes it a major player in the global textile and apparel industry.
Why Use Playroll Services For Pakistan?
- Employing in Pakistan requires companies to have their own legal entity in the country as well as to manage payroll, employee benefits, taxes and legal compliance. This can get quite complicated, especially with the complexity of employment laws in Pakistan.
- With Playroll’s Employer of Record services, your team will be employed by our established legal entities in each country.
- We will take care of payroll, employee benefits, taxes, legal compliance and provide ongoing employee support, so that you can focus on growing your team.
Employer Contributions
These are additional costs incurred by employers over and above the employee’s monthly gross salary and/or bonus.
Gratuity
8.33%
VAT
VAT rate differs according to location
15%
Pension Fund
Calculated on a maximum salary of PKR 32,000.00 per month
15%
Group Life Insurance Premium
Calculated on a maximum salary of 32,000.00 PKR per month
Varies according to selected policy
Employee Contributions
These are costs incurred by employees that reduce their monthly gross salary and/or bonus to determine their net “take home” pay.
Income Tax
Income Tax is ‘Pay As You Earn’
Income bracket per annum
0.0 – 600,000.00 PKR
0.00%
600,000.00 – 1,200,000.00 PK
2,5% of total income exceeding 600,000.00 PKR
1,200,000.00- 2,400,000.00 PKR
15,000.00 + 12.5% of the amount exceeding 1200,000.00 PKR
2,400,000.00- 3,600,000.00 PKR
165,000.00 + 20% of the amount exceeding 2,400,000.00 PKR
3,600,000.00- 6,000,000.00 PKR
405,000.00 + 25% of the amount exceeding 3,600,000.00 PKR
6,000,000.00- 12,000,000.00 PKR
1,005,000.00 + 32.5% of the amount exceeding 6,000,000.00 PKR
12,000,000.00 PKR or more
2,955,000.00 + 35% of the amount exceeding 12,000,000.00 PKR
Employment Terms
General
Minimum Wage
- 32,000.00 PKR per month
Working Hours
- Maximum of 9 hours per day and 48 hours per week
- Employees are entitled to a 1 hour break for lunch
- Typical working hours start at 9h00 to 17h30
Overtime
- Maximum 12 hours per week
Notice Period
- 1 month notice
Severance Pay
- 30 days of wages for every completed year of service or any part thereof in excess of 6 months
Probation Period
- There is no statutory probation period
Bonus
- Statutory bonus paid to workers who have worked for over 90 days
Public Holidays
Public holidays 2023
- 5 February – Kashmir Day
- 23 March – Pakistan Day
- 22 – 24 April – Eid-ul-Fitr
- 1 May – Labour Day
- 29 – 30 June – Eid-ul-Azha
- 27 – 28 July – Ashura
- 14 August – Independence Day
- 28 September – Eid-Milad-un-Nabi
- 9 November 2023 – Allama Iqbal Day
- 25 December – Quaid-e-Azam Day/Christmas
- 26 December – Day after Christmas (Christians Only)
Leave
Paid Leave / Vacation Days
- Paid leave
- Paid by employer
- 14 days after completion of 12 months of service
Sick Leave
- Paid leave
- Paid by Employer
- 8 days
Maternity Leave
- Paid leave
- Paid by employer
- First child: 180 days per annum
- Second child: 120 days per annum
- Third child: 90 days per annum
Paternity Leave
- Paid leave
- Paid by the employer
- 30 days
Personal Emergency Leave
- Paid leave
- Paid by employer
- 10 days
Start hiring in Pakistan today!