Implementation of labour laws is vital for the success of all organisations. Since its independence in 1947, Pakistan has experienced major changes in the labour industry due to socio-political changes.
Initially, many legislative laws were inherited from British India, like the Industrial Dispute Act and the Trade Union Act of 1926. But, today all laws are founded on the Constitution of Pakistan, upholding the Islamic principles.

However, even in this day and age, people are unaware of the basic labour laws, and how they should treat their workforce. So, let’s dive into the basics and learn all the labour laws followed in Pakistan.
What are Labour Laws?
A set of rules and regulations regarding workforce treatment are known as labour laws. These laws are designed to accommodate the needs of all labourers working under organisations in Pakistan, including employment, conditions of work, trade unions, remuneration and labour relations.

Pakistan’s labour laws go back to the India-Pakistan Separation. Since then, our laws have been evolving continuously. And today after years of trial and error, our laws have improved infinitely.
Key Labour Constitutional Laws in Pakistan
The labour laws in Pakistan encompass a wide range of legislations that define the relationship between employers and employees, ensuring that all employees get safe working environments, fair treatment and equal employment practices. Here are the most important labour laws active in Pakistan today:

Provincial Employees Social Security Ordinance of 1965
This legislation extends the health and old age benefits to workers of many sectors. It mandates employer contributions based on employee wages and applies to all establishments designated by Provincial Governments. This law stands firm in safeguarding the health and financial stability of workers in old age and helps them cover essential expenses like medical and pensions.
Worker’s Children Ordinance of 1972
This law requires all organizations employing more than ten employees to contribute towards funding education for their worker’s children. This legislation ensures that the children of the employees have optimal educational opportunities.
Minimum Wage Legislation, 1961
This Minimum Wage Ordinance establishes a minimum wage across all commercial and industrial institutions in Pakistan. This rule ensures that all employees receive fair compensation and are safe from exploitation.
Employees Old Age Benefits Act of 1976
This law governs every establishment and industry in Pakistan that has five or more employees. This legislation guarantees retirement benefits for employees, funded by contributions from both employers and employees to a fund managed by the Employees’ Old Age Benefits Institution (EOBI).
The Industrial and Commercial Employment Law, 1968
This law mandates that any industrial or commercial organization employing more than twenty workers is required to regulate the conditions of the employment. This includes working hours, termination rules and all other employment terms, ensuring fair treatment and practices.
Payment of Wages Legislation, 1936
This law is developed to ensure that all employees receive fair and timely disbursement of wages, working at any factory or establishment. This law also forbids any unauthorized deductions from wages, safeguarding the rights of all employees.
Employment of Children Act of 1991
This legislation was a stepping stone in the labour industry. It safeguards the exploitation of all children across Pakistan. It strictly protects them from the dangers of labour especially in hazardous conditions.
Children like Iqbal Masih played a big part in working against child labour and unshackling thousands of children from its clutches.
This law also establishes the minimum employment age at 14 years for non-hazardous work, designating individuals between 14 and 18 as “adolescents” who can only work under conditions that ensure their health and well-being. It strictly prohibits the employment of children under 14 in factories or mines, except for non-industrial work or family businesses where the work is non-hazardous.
Apprenticeship Ordinance Act of 1964
This law is applied to all establishments under the government and manages the training and employment of apprentices in different trades. This also ensures that all apprentices, meaning learning-level employees receive proper training in order to enter the workforce.
Workmen’s Compensation Act 1923
This legislation requires all employers to compensate employees who sustain any kind of employment-related disease or injury. Applicable to certain classes of employers and their workers, this act is a fundamental piece of legislation that ensures workers are financially protected in the event of work-related accidents or health issues.
The Factories Act of 1934
This legislation applies to any area in Pakistan where ten or more employees work. The Factories Act addresses the crucial welfare of factory workers which includes their working hours, health and safety, leaves, wages and all other protections that ensure their well-being.
Disabled Person’s Act of 1981
This law mandates that an establishment employing a certain number of individuals is required to hire people with disabilities as well. This ensures that disabled individuals are also given equal opportunities and promotes inclusivity in workspaces.
Companies Profits Law of 1968
This law applies to companies meeting certain criteria related to employee count or financial benchmarks. It requires companies to distribute a portion of their profits to employees, promoting a sense of ownership and involvement, and aligning their interests with the company’s growth and success.
Conclusion
The labour laws in Pakistan are designed to advance social justice and economic efficiency by safeguarding workers’ rights and improving labour market flexibility. Ongoing efforts to enhance law enforcement and adapt to evolving labour market conditions are crucial for achieving sustainable economic growth and ensuring the well-being of Pakistani Employees.