The Employees’ Old-Age Benefits Institution (EOBI) runs Pakistan’s national old-age pension scheme for private-sector workers. If your business employs staff, EOBI registration is not optional once you cross the legal threshold, and unpaid contributions build up quietly until an inspection or a worker’s pension claim brings them to the surface, along with arrears and penalties. This guide explains who must register, how contributions are calculated, the monthly routine and how EOBI fits with your other employer registrations.
Quick answer: Under the Employees’ Old-Age Benefits Act, 1976, any industrial or commercial establishment with five or more employees must register with EOBI and register its insured workers. The employer pays 5% and the employee 1% of the prevailing minimum wage each month, regardless of the worker’s actual salary. Contributions are due monthly, and late or missing payments attract arrears, additional charges and possible prosecution.
Which businesses must register with EOBI?
EOBI coverage applies to industrial, commercial and other organisations that employ five or more persons, or employed five or more persons at any time in the previous 12 months. Once covered, an establishment stays covered even if staff numbers later fall. Smaller employers can register voluntarily. Coverage applies to sole proprietors, partnerships and companies alike: the legal form does not matter, the number of employees does.
Workers are insured from their date of joining. Seasonal, contract and probationary staff on your payroll are generally counted, so do not leave them out when you check the threshold.
How are EOBI contributions calculated?
| Contribution | Rate | Calculated on |
|---|---|---|
| Employer share | 5% | Prevailing minimum wage notified by the government |
| Employee share | 1% | Prevailing minimum wage, deducted from salary |
The base is the minimum wage, not the actual salary. A manager earning far above minimum wage and a helper on minimum wage generate the same contribution. When the government revises the minimum wage, contributions change from the effective date, which is a common source of underpayment for employers who forget to update their payroll.
How to register your business with EOBI
- Prepare your business documents. Business name and address, nature of business, ownership details, NTN and, for companies, the SECP incorporation certificate.
- Submit the employer registration form. Apply through EOBI’s online portal or the regional office for your area. EOBI issues an employer registration number.
- Register each worker. Submit employee details with CNIC numbers so EOBI can issue registration cards to insured persons.
- Start monthly payments. Pay the combined employer and employee contribution through the designated bank or online channel and keep the paid challans.
- Report changes. Register new joiners promptly and update records when staff leave.
Monthly EOBI compliance routine
- Update the employee list for joiners and leavers before each payment
- Apply the current minimum wage to the contribution calculation
- Pay by the monthly due date and file or reconcile the contribution statement
- Keep attendance, wage records and paid challans for inspection
- Issue workers proof of their EOBI registration
EOBI deadlines are only one line in an employer’s calendar. Our Pakistani compliance calendar shows how labour, tax and corporate deadlines connect.
What happens if you do not register or pay?
EOBI can assess contributions for the entire period a business was liable, not just from the date it registered. Arrears, additional charges on late payments and legal proceedings under the Act can follow. The bigger cost is often reputational: a worker who reaches retirement age and finds no contribution record has a valid complaint against the employer. Registering late is still far better than not registering at all, so if you have missed the threshold, regularise now.
EOBI and provincial social security: not the same thing
EOBI pays old-age pensions, invalidity pensions, survivor pensions and old-age grants. It is federal. Provincial social security institutions, such as PESSI in Punjab and SESSI in Sindh, provide medical care and cash benefits for sickness, injury and maternity, with their own contribution rates and registration. Most employers who meet the thresholds need both.
EOBI is one of several employer registrations. For the full sequence, see our guide to business registration requirements in Pakistan. Company owners should also keep up with SECP annual compliance.
Frequently asked questions
How many employees make EOBI registration compulsory?
Registration is compulsory for an establishment that employs five or more persons, or did so at any time in the previous 12 months. Smaller employers may register voluntarily.
What is the EOBI contribution rate?
The employer pays 5% and the employee pays 1% of the prevailing minimum wage each month, irrespective of the employee’s actual salary.
Is EOBI calculated on actual salary?
No. EOBI contributions are calculated on the minimum wage notified by the government, so they change when the minimum wage is revised.
At what age can a worker claim an EOBI pension?
The old-age pension age is 60 for men and 55 for women, with a minimum period of insurable employment, generally 15 years. Workers with fewer years may receive a one-time old-age grant.
Is EOBI the same as PESSI or SESSI?
No. EOBI is the federal old-age pension scheme. PESSI and SESSI are provincial social security institutions for medical and short-term benefits, and employers usually need to register with both.
How CEC can help with EOBI registration
Connect Engineers & Consultants registers employers with EOBI and provincial social security, regularises past periods, and sets up a simple monthly compliance routine for your HR or accounts team.
Hired your fifth employee, or not sure you are compliant? Contact us and we will review your position.
Contribution rates, thresholds and the minimum wage are set by law and can change. Confirm current figures with EOBI before calculating payments. This guide is general information, not legal or tax advice.
