Pakistan:
Resisting labour
law changes
As gig economy workers across the world have experienced, third party employment models undermine worker rights. We join workers in Pakistan in resisting damaging changes to the law that would legalise subcontracting of employment in factories.
Law makers in Pakistan are attempting to revise the labour law in Sindh and Punjab provinces. The proposed changes would see the illegal third-party contracting system made legitimate, undermining decades of worker progress.
Unions in Sindh have been taking to the streets to protest the changes, which officials say are a rationalisation of the labour law. Unions have been highlighting the fundamental shift the proposed changes would cause, and are calling for a full tripartite labour conference to ensure workers are properly involved in an inclusive and transparent way in drafting any changes.
The draft labour codes remove the definition of permanent employment and introduce new subcategories of employer (contractors, sub-contractors, third-party contractors and recruitment agencies) towards whom liability is shifted. In practice, this distances workers from their true employer in a factory, and disperses responsibility for fundamental rights.
What is the third-party contracting system?
The illegal third-party subcontracting is already a widespread practice in the export-oriented garment industry in Pakistan. Contractors act as intermediaries between the textile factories and the workers who produce the goods, often recruiting and managing the workforce themselves. This saves the factories money, provides them with flexibility, and allows them to keep liability for HR concerns at one step remove – workers` wages, benefits, and safety.
Why is the third-party contracting system bad for workers?
As gig economy workers around the world have experienced, this is disastrous for employment rights. Workers employed via third party contractors in Pakistan are systematically deprived of the minimum wage, social security registration, pension contributions, written appointment letters and employment contracts, paid annual leave, bonuses, freedom of association rights, and more. Despite being employed within a factory setting, sometimes for many years at a time, workers true legal status as an employee is obscured and they have no recourse to legal action or complaint against the employer, who is actually in control of hours, rates of pay, leave, workplace safety etc.
Our action
Labour Behind the Label are standing in solidarity with the labour movement in Pakistan in calling for revisions to the draft labour codes to ensure the right to permanent employment for work of a permanent nature is maintained. Employers must not be allowed to evade their legal responsibilities for the workers whose labour they profit from. Action must be undertaken by the government and ILO to support a transition away from the use of illegal third-party subcontractors, rather than moves to legalise their status.
Labour Behind the Label handed in a letter at the Pakistan High Commission in London in August 2024, signed in collaboration with No Sweat, War on Want, Remake UK, and the TUC, and will continue work to lobby relevant officials, in solidarity with the position of unions in Pakistan.
Ali's story
“My name is Ali. I have been working as a Machine Operator at Yunus Textile Mills since 2022. In the factory, we are placed under a third-party contract system. We are neither registered with social security nor with Employees’ Old-Age Benefits Institution. The minimum wage for workers is 32,000 rupees, but it is not being paid in the factory. Bonuses and 5% are also not provided to the workers. Our salaries are deposited into bank accounts, but our ATM cards are held by the contractor, who withdraws the money and gives us only half, keeping the rest for himself. I am extremely frustrated and want to quit, but my legal dues are not being paid. I want my rights.”