--- title: "Hiring in Pakistan 2026 | Employer of Record Guide" description: "Hire in Pakistan through Teamed's EOR. 5% EOBI employer contribution, 14 days statutory leave, one month notice from day one. The Pakistan guides, one per layer." canonical: https://www.teamed.global/country-hiring-guides/pakistan --- Pakistan · Country overview Served by Teamed via a Pakistan-licensed EOR entity # What do you need to know to hire in *Pakistan*? Pakistan's EOBI employer contribution is 5% of the minimum wage, statutory leave is 14 days a year after 12 months of service, and the 2023 Maternity and Paternity Leave Act extended paid paternity leave to 30 days for the first three children. Each guide below takes one layer. Last reviewed 13 June 2026 · Pakistan guide ## How does Teamed handle Pakistan hiring for you? Teamed becomes your legal [employer of record](/lp/employer-of-record) in Pakistan for [**from $599 per employee per month**](/pricing), with **zero FX mark-up** in any currency. Payroll, contracts, and the full Pakistan employment law stack run on **one platform**. **Real HR and legal experts** manage every Pakistan hire, from the first offer letter to the final settlement. **An actual person**, not a chatbot or a pooled queue, handles your Pakistan team alongside EOR, contractor onboarding, and entity payroll on **one platform**. There is **no setup fee** and **no exit fee**. Employer cost **passes through at cost, itemised** on every invoice. A Pakistan contractor who converts to payroll keeps their record, and that same employee can **graduate** from EOR to your own Pakistan entity without re-onboarding. Run the [Crossover Calculator](https://www.teamed.global/tools/crossover-calculator) to see the month the model flips. EOR is the right model for a first Pakistan hire, **until it isn't**. Three things you won't find on any other Pakistan EOR guide - **Payroll has three mandatory contribution streams, not one.** EOBI (federal old-age pension) applies nationwide. PESSI in Punjab and SESSI in Sindh run separate provincial social security schemes on top of EOBI. Most competitor guides mention only EOBI. [The tax and payroll guide](/country-hiring-guides/pakistan/tax-and-payroll) covers all three streams. - **The 2023 Maternity and Paternity Leave Act is federal law but province coverage varies.** The federal Act guarantees paid paternity leave. Maternity protection rules differ between federal and provincial employees. Many guides still cite the 1958 Ordinance only. These guides reflect current law. - **Pakistan's income tax uses a zero-rate band, not a personal allowance deduction.** Salaried income up to PKR 600,000 a year attracts no tax at all. The rate then starts at 1% on the next band. US buyers expecting a UK-style personal allowance mechanism will find this easier to model. Answer.cite this Hiring in Pakistan adds a mandatory EOBI contribution of 5% of the minimum wage per employee per month, plus provincial social security contributions in Punjab and Sindh. Payroll runs monthly. Salary must be paid on or before the last working day of each calendar month. The federal minimum wage is PKR PKR 37,000 per month. Punjab's provincial floor is higher. Statutory annual leave is 14 days after 12 months of continuous service. Notice is one month in both directions for permanent workers. Teamed runs Pakistan payroll, contracts, and compliance through an EOR entity holding the required Pakistani registrations. This page is the map. Each guide below is the detail. At a glance · Pakistan PKR · Urdu/English · Monthly payroll Currency PKR EOBI employer 5% of minimum wage, old-age pension EOBI employee 1% of minimum wage Annual leave 14 days after 12 months service Public holidays 11 federal gazetted holidays Minimum notice 4 weeks permanent workers, both directions Top income tax 35% salaried, FY2025-26, above PKR 4.1m 13th salary No not universally mandated ![A warm, wide illustration of Lahore at golden hour: the Badshahi Mosque in the foreground, the walled city stretching behind it, minarets and a clear amber sky above.](/images/country-guides/pakistan-hiring.webp) Pakistan · per employee · per month · flat $ 599 Zero FX. No setup fees. 48-hour onboarding. The price your finance team can forecast against without an asterisk. Zero FX Fixed No setup fee No exit fee 48-hour onboard ## How much does it cost to hire an employee in Pakistan in 2026? A Pakistan hire adds a mandatory EOBI pension contribution of 5% of the minimum wage, plus provincial social security in Punjab and Sindh. Payroll tax remittance to the FBR falls due by the 15 days of each following month. The EOBI employer contribution of 5% of the minimum wage is federal and applies to all eligible workers. Punjab employers also pay PESSI contributions and Sindh employers pay SESSI contributions. These provincial rates are not capped at a fixed national figure and vary. Teamed's Pakistan fee sits on top of your employee's salary, not on top of the statutory contributions. Teamed's Pakistan price is a starting rate, with zero FX in any currency pairing. No setup fees. No exit fees. Salaries, taxes, and benefits passed through at cost on every invoice. The full breakdown, with worked examples at current statutory rates, is in the cost guide. [Read the full Pakistan cost breakdown](/country-hiring-guides/pakistan/cost-breakdown) ## Do you need a Pakistan entity to hire employees in Pakistan? No. An Employer of Record runs Pakistan payroll and contracts from day one. Your own Pakistan private limited company becomes worth considering somewhere around 8 to 12 employees, depending on salary and your registered office costs. Registering a Pakistani private limited company requires SECP registration, a memorandum and articles of association, and ongoing filing obligations under the Companies Act, 2017. An [Employer of Record](/lp/employer-of-record) is faster and cheaper at low headcount. Teamed runs Pakistan payroll, contracts, and labour law compliance from day one. The crossover point depends on Pakistani salary levels and your in-country accounting costs. For most tech and services roles it sits above 8 employees. The EOR vs entity guide runs those numbers for Pakistan. Most EOR providers will not tell you when you have crossed it. We do, and we help you move. You progress from contractor to EOR to your own Pakistan entity on **one platform** under Teamed's Graduation Model, with tenure preserved. [Read the full Pakistan EOR vs entity guide](/country-hiring-guides/pakistan/eor-vs-entity) ## What are the key employment law rules in Pakistan in 2026? Pakistan's federal minimum wage is PKR PKR 37,000 per month. Punjab raised its provincial floor above that from July 2025. The 2023 Maternity and Paternity Leave Act extended paternity leave to 30 days fully paid for the first three children. The federal minimum wage is set by the Minimum Wages Ordinance, 1961, and confirmed at PKR PKR 37,000 per month for FY2025-26. Punjab employers must pay the higher provincial rate, which rose from July 2025. Maximum working hours are 48 hours per week under the Factories Act, 1934. Employers must record working time. The Maternity and Paternity Leave Act, 2023 is current federal law. Maternity leave runs approximately six months for the first birth. Paternity leave is 30 days fully paid for the first three children. The hiring guide covers the day-one contract obligations and the probation rules in full. [Read the full Pakistan hiring guide](/country-hiring-guides/pakistan/hiring-guide) ## What benefits must you provide Pakistan employees in 2026? The statutory floor is 14 days of paid annual leave after 12 months of service, 10 days of paid casual leave, and 16 days of half-pay sick leave per year. Maternity leave runs approximately six months for the first birth, paid, under federal law. Statutory annual leave is 14 days a year under the Factories Act, 1934. Leave accrues after 12 months of continuous service. Casual leave is 10 days per year at full pay. Sick leave is 16 days per year at half pay. There are 11 federal gazetted public holidays. Maternity leave under the 2023 Act is approximately six months fully paid for the first birth, reducing for subsequent children. Paternity leave is 30 days fully paid for the first three children. The benefits guide covers each entitlement and the qualifying service rules. [Read the full Pakistan benefits guide](/country-hiring-guides/pakistan/benefits) ## What are payroll taxes in Pakistan in 2026? EOBI employer contribution is 5% of the minimum wage. Employee EOBI is 1% of the minimum wage. Income tax is zero on salaried earnings up to PKR 600,000 a year, then rises from 1% to a top rate of 35%. EOBI (Employees Old-Age Benefits Institution) employer contribution is 5% of the minimum wage per eligible employee per month. Employee EOBI is 1% of the minimum wage. Punjab employers also pay PESSI contributions and Sindh employers pay SESSI contributions at provincial rates. Employer payroll tax must be remitted to the FBR within 15 days of each month end. Income tax for salaried persons runs on a six-band scale under the Income Tax Ordinance, 2001. Earnings up to PKR 600,000 a year attract zero tax. The rate then rises from 1% on the PKR 600,001 to 1,200,000 band and tops out at 35% above PKR 4,100,000. The tax and payroll guide sets out every band and threshold. [Read the full Pakistan tax and payroll guide](/country-hiring-guides/pakistan/tax-and-payroll) ## How do you terminate an employee in Pakistan? Pakistan statutory notice for permanent workers is 4 weeks in both directions. Severance (gratuity) accrues at 30 days of wages per completed year of service under the Standing Orders Ordinance, 1968. Permanent workers are entitled to one month's notice of termination under the Industrial and Commercial Employment (Standing Orders) Ordinance, 1968, Standing Order 12. Notice applies in both directions. Probationers are not entitled to any notice. Probation under the Ordinance runs up to 3 months, with market practice extending to 6 months in many sectors. Gratuity (severance) accrues at 30 days of wages per completed year of service, or any part in excess of six months. There is no statutory cap on total gratuity. Final pay must be settled within 2 days of termination under the Payment of Wages Act, 1936. Pakistan has no fixed unfair dismissal compensation cap. Labour courts award reinstatement or compensation at their discretion. The termination guide runs the full process. [Read the full Pakistan termination and severance guide](/country-hiring-guides/pakistan/termination-and-severance) ## What should you know before hiring in Pakistan? Two things catch US buyers out. The first is that labour law is layered: federal statutes apply everywhere, but provincial governments have their own minimum wages and social security schemes. The second is that gratuity (severance) accrues from day one of employment and compounds year on year with no statutory ceiling. **The provincial layer matters.** Punjab and Sindh each run their own minimum wages and social security funds (PESSI and SESSI) on top of the federal EOBI. An employee in Karachi (Sindh) and an employee in Lahore (Punjab) carry different statutory cost footprints even on the same salary. Most competitor guides present a single Pakistan figure. Teamed's cost calculator accounts for province. **Gratuity compounds with no ceiling.** Unlike UK statutory redundancy pay, Pakistan gratuity under the Standing Orders Ordinance has no statutory maximum. A long-tenured employee's gratuity obligation grows 30 days of wages per year with no cap. Model this into your total cost of employment from day one, not at the point of termination. [Read the full Pakistan hiring guide](/country-hiring-guides/pakistan/hiring-guide) ## Frequently asked questions How much does it cost to hire an employee in Pakistan? Add EOBI at 5% of the minimum wage per employee, plus provincial social security contributions in Punjab (PESSI) or Sindh (SESSI). The federal minimum wage is PKR PKR 37,000 per month. Punjab's provincial floor is higher. Teamed's Pakistan fee is one flat number per employee per month, with zero FX mark-up in any currency pairing. The cost breakdown guide has worked examples. Can a US company hire in Pakistan without an entity? Yes. An Employer of Record like Teamed runs Pakistan payroll, contracts, and compliance through its own registered entity. You direct the work. Teamed becomes the legal employer of record. Setup takes 48 hours once terms are confirmed. Forming your own Pakistani private limited company requires SECP registration and takes several weeks. What is Pakistan's statutory annual leave entitlement? Permanent employees are entitled to 14 days of paid annual leave per year under the Factories Act, 1934, after completing 12 months of continuous service. Employees also get 10 days of paid casual leave and 16 days of half-pay sick leave per year. There are 11 federal gazetted public holidays in addition. What are Pakistan's statutory notice periods? Permanent workers are entitled to 4 weeks notice of termination from the employer, and must give 4 weeks notice on resignation. Probationers are not entitled to any notice. Probation runs up to 3 months under the Standing Orders Ordinance, with market practice extending to six months in many sectors. How is severance calculated in Pakistan? Gratuity under the Industrial and Commercial Employment (Standing Orders) Ordinance, 1968 accrues at 30 days of wages per completed year of service, or any part in excess of six months. There is no statutory cap on total gratuity. Final pay must be settled within 2 days of termination under the Payment of Wages Act, 1936. What is Pakistan's income tax rate for salaried employees? Salaried income up to PKR 600,000 a year attracts no income tax at all. The rate then starts at 1% on income between PKR 600,001 and PKR 1,200,000, rising through four further bands to a top rate of 35% on income above PKR 4,100,000. Employer withholding tax must be remitted to the FBR within 15 days of each month end. Teamed Legal Operations Pakistan looks straightforward from the outside: monthly payroll, one month's notice, clear gratuity formula. The complexity sits in the provincial layer. A hire in Punjab and a hire in Sindh are different compliance exercises. Get the province right before you write the first contract. A note from Tom Price-Daniel Pakistan has one federal labour code and four provinces that each add their own rules on top. Gratuity accrues from day one with no statutory ceiling. The provincial minimum wage and social security rates vary by location. Read the right Pakistan guide before the first hire, not after the first payroll dispute. Tom Price-Daniel · Co-founder, Teamed ## Keep reading - [Pakistan hiring guide, offer to payslip](/country-hiring-guides/pakistan/hiring-guide)guide - [Pakistan employer cost breakdown 2026](/country-hiring-guides/pakistan/cost-breakdown)guide - [EOR vs entity in Pakistan](/country-hiring-guides/pakistan/eor-vs-entity)guide - [Pakistan termination and severance](/country-hiring-guides/pakistan/termination-and-severance)guide - [Pakistan tax and payroll](/country-hiring-guides/pakistan/tax-and-payroll)guide - [Employer of Record overview](/lp/employer-of-record)core - The Graduation Modelcore - [Teamed pricing, Zero FX Fixed](/pricing)core - [Crossover Calculator](https://www.teamed.global/tools/crossover-calculator/pakistan)tool - [Talk to an expert](https://www.teamed.global/contact)CTA A note on this page. This is a guide, not legal, tax or accounting advice. Rules change and vary by jurisdiction. Verify current requirements with the Federal Board of Revenue (FBR), the Ministry of Overseas Pakistanis and Human Resource Development, and the relevant provincial labour authority for Pakistan, or speak to a qualified professional, before relying on any specific framework.