Employer of record in Pakistan: costs, gratuity and notice
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The confirmed portion of an employer's statutory cost in Pakistan is the EOBI old-age benefits contribution, 5% of the PKR 40,700 minimum wage or a flat PKR 2,035 a month per employee, which is 0.22% of a PKR 11,076,884 (USD 40,000) salary; provincial social security and other levies are not yet included in that figure, and EOR providers charge $199 (Payoneer Workforce Management, formerly Skuad) to $699 (Oyster) a month, checked October 2026. The obligation US companies most often leave out is gratuity: under the federal Standing Orders, a permanent worker who leaves other than for misconduct is owed 30 days' wages for each completed year of service, unless an equal or better provident fund covers those years.
An employer of record in Pakistan is a Pakistani company that puts your worker on its own payroll, registers them with the EOBI, withholds tax and applies federal or provincial labor law, while you direct the work.
- Employer cost on a sample salary
- Partial: 0.22% EOBI onlyon top of gross pay
- Currency
- PKR
On this page
Pakistan's rules: flat contributions, provincial law
EOBI is charged on the minimum wage, not on salary. The Employees' Old-Age Benefits Institution sets the employer share at 5% of the minimum wage and the employee share at 1%, so the cost is a fixed amount per head whatever the person earns. At PKR 40,700, that is PKR 2,035 from the employer and PKR 407 from the employee each month.
The minimum wage moved on July 1, 2026. The federal budget for FY2026-27 announced PKR 40,700 a month, up from PKR 37,000, and a Finance Division memorandum of August 21, 2026 applies it to federal civil employees. Provinces notify their own rates. Because EOBI is pegged to the minimum wage, it rises with it. EOBI's own page shows no effective date, so confirm that your provider bills EOBI on PKR 40,700 and not an older base.
Labor law is mostly provincial. Since 2010 the provinces have their own labor laws. The terms below come from the federal Industrial and Commercial Employment (Standing Orders) Ordinance 1968, which covers Islamabad and trans-provincial firms and applies to establishments with 20 or more workmen, per the ILO EPLex 2026 profile.
- Probation: up to 3 months (S.O. 1(c)).
- Notice: 1 month by either side for permanent workmen, or 1 month's average wages in lieu, except for misconduct (S.O. 12(1)). No notice applies to probationers, badlis or temporary workmen (S.O. 12(2)).
- Gratuity: 30 days' wages per completed year of service, or part over 6 months, on resignation or termination other than for misconduct (S.O. 12(6)).
We have not yet confirmed from an official source: provincial social security (PESSI in Punjab, SESSI in Sindh and others), the Workers' Welfare Fund and Workers' Profit Participation Fund, provincial minimum wages, annual leave, public holidays, pay frequency or working hours. Ask your EOR which province it registers your hire in and for every charge it will bill.
Employment costs and rules in Pakistan
| Item | Pakistan |
|---|---|
| Employer social contributions | About 0.2% at the sample salary (EOBI only: 5% of the minimum wage, a fixed amount per employee); provincial social security not confirmed |
| What the employer pays | EOBI: employer 5% of minimum wage (employee 1% of minimum wage). Provincial social security (PESSI Punjab, SESSI Sindh and others) not confirmed today |
| Caps and ceilings | EOBI contributions are calculated on the minimum wage, not actual pay, so the cost is a fixed amount per employee |
| Employee contributions | 1% of minimum wage (EOBI) |
| Minimum wage | Federal: PKR 40,700 per month from Jul 1, 2026 (FY2026-27, up from 37,000; Finance Division O.M. of Aug 21, 2026 applies it to federal civil employees, and the budget announced it as the minimum wage). Provinces notify their own rates |
| Probation | 3 months (federal: Industrial and Commercial Employment (Standing Orders) Ordinance 1968, Schedule, S.O. 1(c)) |
| Notice period | Permanent workmen: 1 month's notice by either side, or 1 month's average wages in lieu, except for misconduct (S.O. 12(1)); none for probationers, badlis and temporary workmen (S.O. 12(2)) |
| Severance | Gratuity of 30 days' wages per completed year of service, or part over 6 months, on resignation or termination other than for misconduct; not due for years covered by an equal-or-better employer provident fund (S.O. 12(6)) |
| Sample salary used | PKR 11,076,884 a year (PKR 923,074/mo) = USD 40,000 at SBP M2M rate 276.9221 (Oct 15, 2026) |
| Employer cost on that salary | Partial: 0.22% EOBI only |
Checked October 16, 2026. Source type: official. Sources are listed at the end of this page.
What an EOR charges to employ someone in Pakistan
| Provider | EOR fee per employee per month | Deposit | Entity model (provider claim) |
|---|---|---|---|
| Payoneer Workforce Management | from $199 | None listed | Claims owned entities across APAC, MEA, Europe and the Americas |
| Pebl | $399 | Not listed | About 90% of employees on Pebl-owned entities |
| Playroll | from $399 | One month's salary per employee, refundable | No clear owned-entity claim |
| Rivermate | $319 to $639 | Not stated | Claims 38 owned entities |
| Multiplier | $459 (annual) or $499 (monthly) | Sized from costs, fees and notice period (method published, no fixed amount) | Claims owned entities in 160+ countries |
| Rippling EOR | Quote only (third-party reference: $499) | Not listed | Claims Rippling entities; no partner mention |
| Deel | $599 | Not stated by Deel | Claims owned entities in 130+ countries |
| Remote | from $599 | Waived for startups; otherwise not stated | Claims 100% owned entities in 90+ countries |
| Atlas | from $599 | Not published | Claims owned entities in 160+ countries |
| Papaya Global | from $650 | Refundable deposit, amount not stated | Uses in-country partners |
| Oyster | $699 | At least one month of total service cost, refundable (per its terms) | Owned entities and partners |
| Globalization Partners (G-P) | Quote only | Not stated | Information page claims 100+ wholly owned entities |
Source: each provider’s pricing page, checked October 16, 2026. Fees are the provider’s charge on top of salary and the employer contributions above. Some providers adjust prices by country.
The confirmed costs on a PKR 11.08 million salary
USD 40,000 at the State Bank of Pakistan M2M rate of 276.9221 PKR per USD (October 15, 2026) is PKR 11,076,884 a year, or PKR 923,074 a month. The table shows only what we have confirmed; it is not the full employer cost.
| Line | Per month (PKR) | Per year (PKR) |
|---|---|---|
| Gross salary | 923,074 | 11,076,884 |
| EOBI employer, 5% of PKR 40,700 | 2,035 | 24,420 |
| EOR fee, $599 a month | 165,876 | 1,990,516 |
| Total of confirmed items | 1,090,985 | 13,091,820 |
Source: EOBI (rates, no effective date shown); State Bank of Pakistan M2M rate of Oct 15, 2026; Deel and Remote $599 list price (pricing pages checked Oct 16, 2026). Provincial social security not included. Checked Oct 2026.
The math: 5% x 40,700 = PKR 2,035 a month, x 12 = PKR 24,420, or 0.22% of salary. The fee is $7,188 a year, and 7,188 x 276.9221 = PKR 1,990,516. At $399 (Pebl, Playroll) the fee is $4,788; at $699 (Oyster) it is $8,388.
Not yet included: provincial social security, the Workers' Welfare Fund and Workers' Profit Participation Fund (both set at company level on profits), any provident fund contribution, and the gratuity liability building up each year. On this salary the EOR fee is about 82 times the EOBI charge, so the fee and those unconfirmed items decide your budget. Try other salaries in the international hiring cost calculator.
Which EOR to use in Pakistan
Our published scores put Multiplier first at 79/100 and Oyster second at 64/100, then Remote (62), Playroll (60), Pebl (57) and Deel (54). See how our scores work. No provider publishes a Pakistan-only fee, and Multiplier says about 11% of countries cost more than its $499 list price.
Ask which provincial social security scheme applies, whether the contract provides gratuity or a provident fund, and what FX margin applies when salary is paid in rupees. Multiplier says it adds no FX markup, a claim a Trustpilot reviewer disputed in August 2026. Compare the EOR ranking and the Deel, Remote and Oyster reviews.
Contractors in Pakistan
A Pakistani contractor invoicing you for defined projects avoids EOBI and the EOR fee. A full-time, managed role can be treated as employment, which brings EOBI, provincial social security, notice and gratuity. Compare contractor management platforms or a contractor of record.
Opening a Pakistani company
Your own company needs EOBI and provincial registrations and local payroll, set against $7,188 a year per EOR hire at $599. Weigh it in our EOR versus entity comparison and the EOR fee breakdown.
Frequently asked questions
What does an employer pay to the EOBI in Pakistan?
Is gratuity mandatory in Pakistan?
What notice period applies in Pakistan?
What is the minimum wage in Pakistan for FY2026-27?
How much does an EOR cost in Pakistan?
Sources (12)
- Pebl: Pebl EOR pricing (checked Oct 16, 2026)
- Playroll: Playroll pricing (checked Oct 16, 2026)
- Multiplier: Multiplier pricing (checked Oct 16, 2026)
- Deel: Deel pricing (checked Oct 16, 2026)
- Remote: Remote pricing (checked Oct 16, 2026)
- Oyster: Oyster pricing (checked Oct 16, 2026)
- Trustpilot: Multiplier reviews (checked Oct 2026)
- Payoneer Workforce Management (formerly Skuad): Skuad pricing (checked Oct 16, 2026)
- eobi.gov.pk (checked October 16, 2026)
- eplex.ilo.org/en/country-detail?code=PAK&yr=2026 (checked October 16, 2026)
- finance.gov.pk/circulars/circular_21082026.pdf (checked October 16, 2026)
- sbp.org.pk/ecodata/rates/m2m/M2M-Current.pdf (checked October 16, 2026)
This page is general information, not tax, legal or accounting advice. Rules and rates change, so check the official source linked above before you file or sign a contract. Read our disclaimer.