Minimum wage in Pakistan 2026: PKR 40,700 federal rate

Why the federal figure is not the private-sector rate

Since the 18th Amendment in 2010, labor is a provincial subject. Punjab, Sindh, Khyber Pakhtunkhwa and Balochistan each notify a minimum wage for unskilled adult workers through their own Minimum Wages Board, and the Islamabad Capital Territory has its own board for private employers there. The boards usually act after the federal budget sets its figure for the fiscal year running July to June.

So PKR 40,700 is the budget benchmark and the binding rate for federal staff. For a private company in Lahore or Karachi, the legal floor is the provincial notification, which may or may not match it.

The federal rate by month and year

The memorandum raised the federal minimum by 10%, from PKR 37,000 to PKR 40,700, effective July 1, 2026 "till further orders". Over a year: PKR 40,700 x 12 = PKR 488,400, about $1,764.

For context, the Pakistan Bureau of Statistics reports average monthly wages of PKR 39,042 for employees in its 2024-25 Labor Force Survey, a survey figure that includes informal-sector jobs. See the Pakistan average salary page for how to read it.

EOBI and other employer costs

The Employees' Old-Age Benefits Institution (EOBI) charges the employer 5% and the employee 1%, calculated on the minimum wage rather than on actual pay, so it is a fixed amount per employee whatever the salary. Provincial social security schemes such as PESSI in Punjab and SESSI in Sindh add employer contributions too; we have not confirmed their rates, so this page gives no all-in percentage.

Hiring in Pakistan without an entity

EOR providers publish fees of $99 (Native Teams, whose help center says EUR 99, a starting price) to $699 (Oyster) a month per worker, checked October 16 and 18, 2026. Deel's $599 is about four times the federal minimum in dollars, so an EOR makes sense mainly for professional roles; for lower-paid work compare a contractor of record or your own entity. The EOR rankings list providers by score, the Pakistan employer of record guide covers contracts, and the cost index shows which countries have confirmed contribution rates. Across the border: India's state and central rates.