Setting Up a Company

Types of Companies and Capital (Max/Min)	Number of Partners/Shareholders and Liability
Sole Proprietorship No minimum capital	One Unlimited liability
Partnership No minimum capital	Minimum number is 2, while as the maximum number is 20. Liability of the partners is unlimited
Private Limited Minimum paid up capital of PKR 100,000	Minimum number is 2, while as the maximum number is 50. Limited liability to the amount contributed.
Public Limited Minimum paid up capital of PKR 100,000	Minimum number is 3, while as there is no limit on the maximum number of members/shareholders. The liability of a member is limited to the face value of the shares he owns

The Competent Organization: The Board of Investment.
The Registration Department of the Security and Exchange Commission of Pakistan (SECP).

Source: Doing Business.

Working Conditions

Legal Weekly Duration: 48 hours, 54 hours for seasonal factories.

This applies only to factories/offices employing ten or more workers.
Retirement Age: 60 years
Working Contracts: Employment contract (also called Appointment letter) is regulated by Industrial and Commercial Employment Ordinance of 1968 Every employer in an industrial or commercial establishment (with more than 20 workers) is required to issue a formal appointment letter at the time of employment of each worker. The appointment letter should necessarily mention the main terms and conditions of employment, namely nature and tenure of appointment, pay allowances and other benefits.

There are specific rules for termination of an employee. Terminating an employee is not always so easy.

Minimum Wage: The federal law defines minimum wages for unskilled workers only, which is currently PRs 2,500 per month. The government keeps on revising it from time to time.
Average Wage: It was PKR 3,000 per month for unskilled workers..
Social contributions: Social Security Contributions Paid By Employers:
Governed by Employees social security ordinance of 1965.

Employer’s contribution: PKR 210 for an employee drawing upto PKR 5,000 per month. The workers once covered under this scheme remain secured even if their wages exceed Rs. 5,000/- per month.

Social Security Contributions Paid By Employees:
Governed by Employees social security ordinance of 1965.
Employee’s contribution: PKR 20 per month.

Social Dialogue and Involvement of Social Partners: The labor relations in Pakistan are controlled by the Industrial Relations Ordinance of 2002 gives industrial workers the right to form trade unions and bargain. However the union organizers are generally subjected to a variety of restrictions that hinder their activities and effectiveness.

Moreover the country’s petroleum sector is subject to the Essential Services Maintenance Act. The Act bans strikes, limits workers’ rights to change employment, and affords little recourse to a fired worker, but allows collective bargaining. However, this Act is not applied very frequently.
The government of Pakistan has ratified 34 ILO conventions relating to human rights, workers' rights and working conditions.
Unions: Pakistan Workers Federation
All Pakistan Trade Union Congress
All Pakistan Trade Union Federation
Unionization Rate: 10% in industrial labor force.
5% in total labor force.
Labor Regulation Bodies: Ministry of Labour and Manpower
The representation of the International Labor Organization in Pakistan

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