Minimum Wage is the wage level (set by Government, either after consultation with the social partners i.e. worker organizations and employer associations or unilaterally) below which it is illegal for the employer to pay his/her employees.
Minimum Wage in Pakistan is set by the following two acts:
• Pakistan Minimum Wages for Unskilled Workers Ordinance, 1969
• The Minimum Wages Ordinance, 1961
In June 2013 the Federal Government has raised the minimum wage from Rs. 8,000 to Rs. 10,000 per month for unskilled workers. This decision comes in the wake of budgets presented by the Provincial Governments of Punjab and Khyber Pakhtunkhwa. These two provincial governments raised their respective minimum wages from Rs. 9,000 to Rs. 10,000 per month. The other two provinces, i.e., the Sindh Province and Balochistan province have decided to retain their earlier announced minimum wage of Rs. 8,000 and Rs. 9,000 respectively. These new minimum wages, once the budget approval process is complete in June, will be applicable from July 01, 2013. The detailed minimum wage notifications would be issued later on by the provinces.
Minimum Wages for Unskilled Workers are fixed under the 1969 Ordinance and these are currently PKR 8,000 in Sindh and Federal Capital Area. The minimum wage is PKR 9,000 in the Provinces of Punjab, Khyber Pakhtunkhwa and Balochsitan. The Minimum Wages Ordinance, 1961 applies to all industrial establishments’ employees (whether skilled, unskilled or apprentices and even domestic workers) but it excludes the employees of Federal or Provincial governments, coalmine employees or persons employed in agriculture.
There is yet another law that provides for minimum wage fixation for coal mine workers i.e. The Coal Mines (Fixation of Rates of Wages) Ordinance 1960. Provincial Governments issue minimum wage notifications for these coal miners and they may also consult Mines Welfare Board in wage fixation (but it is not necessary)
As for the Minimum Wages Ordinance, 1961, specially constituted tripartite provincial minimum wage boards recommend minimum wage rates to the provincial governments. These tripartite (i.e. where three social partners; worker, employer and government; meet, discuss and solve work related issues together) boards are constituted at the provincial level and they are entrusted with the statutory task of recommending the minimum wage rates for time work; piece work; overtime work; work on weekly rest day; paid holidays and the minimum time rates for workers employed on piece work so as to guarantee minimum wages for such workers on a timely basis. The status of provincial minimum wage boards is only advisory and the power rests with the provincial government to declare these wages. These recommendations become enforceable only when accepted and notified by the respective provincial governments. The Minimum Wage Boards can also periodically review these wages and recommend any amendments to their respective governments however authority again rests with the government whether it adopts and give these recommendations a legal status.
In view of Labour Policy 2010 and Supreme Court Orders, all the provincial governments (i.e. Punjab, Sindh, Khyber Pakhtunkhwa and Balochistan) had fixed the minimum wage rates for different (skilled and semi-skilled) workers and have notified these. Punjab and Balochistan have notified minimum wage rates for 51 and 30 different industries respectively. Similarly, Khyber Pakhtunkhwa government has also issued wage rates for all industries however these notifications don't apply to the Federally Administered Tribal Areas (FATA). Paycheck.pk currently provides minimum wage information for the Sindh province (for 2010-11), which notified these wages on November 15, 2010 for 40 industries. The new minimum wage for the Province of Punjab which notified its new minimum wage i.e. PKR 9,000 for 51 industries is now available on the website. Other provinces have not issued the minimum wage notification yet.
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