Title: Overseas Compensation: A Guide to Vacation and Benefits in Pakistan for Employers


Pakistan, with its rich culture and history, attracts many overseas employers for investment and employee recruitment. However, for employers, understanding Pakistan's vacation and benefits system is crucial. In this blog post, we will introduce you to the vacation and benefits guide in Pakistan, helping you better manage your employees in the country.

I. Statutory Leaves

According to the Pakistan Labor Law, employees are entitled to statutory leaves based on certain conditions and years of service:

1. After continuous employment for oneyear, employees are entitled to 10 days of paid annual leave.

2. After continuous employment for threeyears, employees are entitled to 15 days of paid annual leave.

3. After continuous employment for fiveyears, employees are entitled to 20 days of paid annual leave.

In addition to paid annual leave, employees also have the right to other types of leaves such as marriage leave, maternity leave, bereavement leave, etc. Specific leave durations and benefits should bedetermined in accordance with Pakistan labor laws and company policies.

II. Overtime and Overtime Pay

In Pakistan, overtime hours for employeesare arranged based on the company's needs and the terms of the employmentcontract. According to the Pakistan Labor Law, employees can work a maximum of48 hours per week, and any work beyond this should be considered as overtime.

For overtime hours, companies are required to pay overtime pay to employees. According to the Pakistan Labor Law, overtime pay should be calculated at twice the employee's regular salary. However, companies can also negotiate with employees to provide alternative forms of compensation or rest time under certain conditions.

III. Social Insurance and Benefits

In Pakistan, employers have an obligation to provide social insurance and benefits to employees. According to the Pakistan Labor Law, employers need to purchase the following social insurances for employees:

1. Pension Insurance: Employers are required to contribute 5% of the employee's salary to the pension fund.

2. Medical Insurance: Employers need to contribute 1% of the employee's salary to the medical insurance fund.

3. Work Injury Insurance: Employers need to contribute 1% of the employee's salary to the work injury insurance fund.

Additionally, employers can voluntarily provide other benefits such as extra medical insurance, accident insurance, etc. These benefits can enhance employee satisfaction and loyalty.

IV. Year-End Bonuses

In Pakistan, year-end bonuses are a common incentive. Employers can choose to pay year-end bonuses to employees based on company policies and employee performance. Year-end bonuses are typically a certain percentage of the employee's annual salary and can be adjusted based on company performance.

V. Other Benefits

In addition to the mentioned benefits, employers can provide additional benefits based on their situation and employee needs. For example:

1. Training and Development Opportunities: Employers can offer training and development opportunities to help employees enhance their skills and competitiveness.

2. Flexible Working Hours: Employers can allow employees to arrange their working hours flexibly, improving both work efficiency and quality of life.

3. Fitness Benefits: Employers can provide fitness facilities or subsidies to promote the physical and mental well-being of employees.

In conclusion, as an overseas employer recruiting and managing staff in Pakistan, understanding the country's vacation and benefits system is crucial. By complying with Pakistan labor laws and providing reasonable welfare treatment, you can strengthen employee loyalty and a sense of belonging to the company. We hope this blog post is helpful, and we wish you smooth business development in Pakistan!

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