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Employment Law

Essential Clauses in Pakistani Employment Contracts

March 2026 · LexForm Research · Shops & Establishments Ordinance; Factories Act 1934

What every employment contract in Pakistan should contain to protect both employer and employee interests.

A well-drafted employment contract should include: job title and description, probation period, salary and benefits breakdown, working hours, leave entitlement (annual, sick, casual), notice period for termination, non-compete and confidentiality clauses, intellectual property assignment, dispute resolution mechanism, and applicable law. Under the Shops and Establishments Ordinance, certain terms are mandatory. For senior executives, bonus structures, stock options, and severance packages should be clearly defined. LexForm drafts employment contracts compliant with Pakistani labour law and tailored to the specific industry and role.

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