Most employees in Pakistan never see the full list of benefits the law puts in their name. Some are federal, some are provincial, some depend on how many people your employer hires - and many workers only discover a missing gratuity cheque or an unregistered EOBI account years too late. This guide sets out, benefit by benefit, what you are legally entitled to, the law that grants it, and how to enforce it. For the wider framework, start with our labour laws overview.
The benefits at a glance
Here is the core statutory package for a formal-sector worker. Thresholds and administration differ across Punjab, Sindh, KP and Balochistan after the 18th Amendment, so treat these as the baseline rather than the ceiling:
| Benefit | Governing law | Who pays / how much |
|---|---|---|
| Old-age pension | EOBI Act 1976 | Employer 5% + employee 1% of minimum wage |
| Medical / social security | Provincial Employees Social Security Ordinance 1965 | Employer 6% of wages; worker pays nothing |
| Gratuity | Standing Orders Ordinance 1968 | Employer - lump sum on leaving service |
| Provident fund | Standing Orders Ordinance 1968 | Employer at least matches employee |
| Annual / casual / sick leave | Standing Orders Ordinance 1968 | Paid by employer (see leave table) |
| Profit bonus | Companies Profits (Workers Participation) Act 1968 | Share of company profits to workers |
Headcount matters. EOBI generally covers establishments with five or more workers. The Standing Orders Ordinance regulates commercial and industrial establishments (commonly 20 or more workers, higher in some industrial cases). Below these thresholds, benefits may rest on your contract instead of statute.
EOBI: your old-age pension
The Employees Old-Age Benefits Institution (EOBI) is Pakistan's federal contributory pension scheme under the EOBI Act 1976. Your employer must register you and deduct contributions from your first month of insurable employment. The employer pays 5% and you pay 1%, both calculated on the federal minimum wage rather than your actual salary.
To draw an old-age pension you generally need at least 15 years of registered insurable employment and to reach age 60 (men) or 55 (women). The minimum EOBI pension is PKR 11,500 per month from January 2026. The scheme also provides survivors, invalidity and old-age grant benefits. The single most common problem is non-registration - so check your status early. Our dedicated EOBI guide explains how to verify contributions by CNIC and recover missing arrears.
Provincial social security and medical cover
Separate from EOBI, the Provincial Employees Social Security Ordinance 1965 gives lower-paid workers free medical treatment through provincial institutions - PESSI in Punjab, SESSI in Sindh, and their counterparts in KP and Balochistan. The employer contributes around 6% of wages; the worker contributes nothing. Cover typically includes free treatment at social security hospitals and dispensaries, plus sickness, maternity, injury and death benefits for the worker and dependants, subject to a wage ceiling that varies by province.
Gratuity vs provident fund
These are the two big end-of-service benefits, and workers often confuse them. Under the Standing Orders Ordinance 1968 an employer chooses to run one, the other, or both - a worker is not automatically entitled to both.
| Gratuity | Provident fund | |
|---|---|---|
| Who funds it | Employer only | Employer + employee |
| Typical formula | ~30 days last-drawn wages per completed year of service | Monthly % of salary from both sides; employer at least matches worker |
| When paid | On leaving service after 6+ months (retirement, death, termination) | Balance payable on exit, even on resignation or dismissal |
| Employer share on resignation | Payable per formula | Worker keeps full employer contribution too |
Where an employer maintains a provident fund (or an approved pension fund) with an employer contribution of at least 50%, gratuity is not separately payable for that period. Deep dives on each: our gratuity rules guide and provident fund guide.
Paid leave entitlements
The statutory leave floor under the Standing Orders Ordinance is often underused because workers simply do not know it exists:
| Type of leave | Days per year | Pay |
|---|---|---|
| Annual (earned) leave | 14 daysafter 12 months | Full pay; unused days can carry forward |
| Casual leave | 10 days | Full pay |
| Sick leave | 16 days | Half pay (on medical certificate) |
| Maternity leave | Varies by province | Paid - see provincial law |
Provincial statutes and company policy can improve on these figures, and maternity entitlements in particular differ widely across provinces. See our leave policy and law guide and maternity leave guide for the current provincial position.
Bonus and profit sharing
Under the Companies Profits (Workers Participation) Act 1968, eligible companies allocate a share of annual profits to a workers participation fund, from which qualifying workers receive a payment. Many employers also pay festival or performance bonuses contractually. A bonus written into your appointment letter or a settlement is enforceable like any other term - keep the document, because it is your evidence.
What to do if benefits are denied
Unpaid gratuity, an unregistered EOBI account, or leave that is refused are all recoverable. The usual route is: raise a written grievance with the employer, escalate to the provincial labour department, and if unresolved, file before a labour court. Time limits apply, so act promptly and keep your appointment letter, payslips and any correspondence. Our final settlement guide covers what should be in your last cheque, and termination of employment explains dues on dismissal.
Exact contribution ceilings, wage limits and bonus formulas change with each Finance Act and vary by province. For your specific situation, confirm the figures with an employment lawyer before relying on them - book a labour law consultation.
Frequently asked questions
Do all employees get EOBI in Pakistan?
EOBI generally covers workers in establishments with five or more employees. Your employer must register you and pay 5% while you pay 1%, both on the minimum wage. Below the threshold, cover may depend on your contract.
Can I get both gratuity and provident fund?
Not automatically. The employer decides whether to run gratuity, a provident fund, or both. Where an approved provident or pension fund with a 50%+ employer share exists, gratuity is not separately payable for that period.
How much gratuity will I receive?
A common formula is around 30 days of last-drawn wages for each completed year of service, payable after six months of service. Your contract or company rules may set a different basis, so check both.
Is social security the same as EOBI?
No. EOBI is a federal old-age pension scheme. Provincial social security (PESSI, SESSI and others) provides free medical treatment and related benefits, funded by a 6% employer contribution.
What if my employer never registered me for benefits?
Non-registration is one of the most common breaches. You can claim arrears and recover dues through the labour department or a labour court. A LegalPK employment lawyer can pursue the claim for you.