Labour and Employment Law in Pakistan: Termination, Misconduct, and Your Right to Reinstatement
Whether a terminated employee can get their job back, or only compensation, in Pakistan depends heavily on a distinction most people have never heard of before they need it: are you legally a "workman" or not? That single classification determines which forum you can even approach, and it shapes what remedy is realistically available.
At Global Law Company, we advise both employers and employees on terminations, misconduct inquiries, and disputes before Labour Courts and Industrial Relations forums. For the broader corporate compliance picture, see our corporate lawyer in Pakistan guide.
1. Which Law Covers Your Employment
Two overlapping frameworks matter most for ordinary employment disputes: the Industrial and Commercial Employment (Standing Orders) Ordinance 1968, which sets out substantive rules on misconduct, termination, and disciplinary procedure for industrial and commercial establishments, and the Industrial Relations Act 2012 (with provincial equivalents such as the Sindh Industrial Relations Act 2013 and Punjab Industrial Relations Act 2010), which governs collective bargaining, grievance procedures, and access to Labour Courts and tribunals. Which one applies, and what remedy is available, often turns on whether the employee falls within the legal definition of a "workman".
2. Termination Requires Due Process, Not Just Cause
Having a genuine reason to terminate someone is not, on its own, enough. In Muslim Commercial Bank Limited v. Khawja Sajjad Mehmood (2002 PLC 120), a bank employee was charge-sheeted and terminated after an inquiry into allegations of assaulting his manager, habitual lateness, and unauthorised absence. The Labour Appellate Tribunal and later the Karachi High Court found that although an inquiry was held by a competent officer, the employee was proceeded against ex parte without the legally required notice of the charges against him, and was effectively condemned unheard, a fatal procedural defect under Standing Order 15(3)(4) of the West Pakistan Industrial and Commercial Employment (Standing Orders) Ordinance 1968 and section 25-A of the Industrial Relations Ordinance 1969. Whatever the underlying misconduct, skipping proper notice and hearing can unravel an otherwise justified termination.
3. Misconduct Findings: Reinstatement vs. Damages Only
Even where misconduct is genuinely proven, the available remedy depends heavily on the employee's status and the nature of the employment relationship. In Pakistan Security Printing Corporation (Pvt.) Limited v. Mehmood Salahuddin (2017 PLCN 3), an employee's grievance application over termination for habitual lateness was allowed, and the employer was directed to reinstate him and conduct de novo (fresh) proceedings, giving him a full opportunity to contest the charge, under sections 34 and 48 of the Sindh Industrial Relations Act 2013 and Standing Order 15(3)(e) of the 1968 Ordinance. But reinstatement is not guaranteed in every context. In Muhammad Ibrahim Hajano v. Pakistan State Oil Company Limited (2018 PLC(CS)N 135), the Karachi High Court applied the classic "master and servant" principle to hold that, in certain circumstances, an aggrieved employee can only seek damages for wrongful dismissal, not reinstatement, particularly where the inquiry procedure itself was not shown to be defective and the employee had participated in it.
4. Workman or Not, Why It Changes Everything
The "workman" classification is the hinge on which most of these outcomes turn. In Muslim Commercial Bank Ltd. v. Muhammad Shafi (2002 PLC 124), a bank cashier dismissed over alleged misappropriation challenged his dismissal through a grievance application to the Labour Court. The Court held that because the employee was not a "workman" under the applicable law, he was not entitled to maintain a grievance petition at all, a threshold jurisdictional bar that exists regardless of how strong the underlying complaint about the dismissal might be. Employees in supervisory, managerial, or certain administrative roles are frequently found to fall outside "workman" status, which pushes their remedy toward an ordinary civil suit for damages rather than the faster, employee-friendly Labour Court/grievance route.
5. Practical Steps for Employers and Employees
For employers, this means disciplinary action has to follow the Standing Orders procedure precisely, charge-sheet, proper notice, a fair inquiry, and a reasoned decision, regardless of how clear-cut the misconduct appears. For employees, it means understanding early which forum you can actually use: a workman generally has access to the Labour Court/grievance route and can seek reinstatement, while a non-workman is often limited to a civil suit for damages arising from wrongful termination.
Termination Compliance Checklist
- ✓Issue a proper charge-sheet before initiating any disciplinary inquiry, don't skip straight to a decision.
- ✓Give the employee genuine notice of the specific charges and a real opportunity to respond, ex-parte inquiries are a common ground for reversal.
- ✓Determine the employee's "workman" status early, it determines both forum and available remedy.
- ✓Document the inquiry process itself, procedural defects can undo an otherwise sound misconduct finding.
- ✓For workmen, expect reinstatement (potentially with de novo proceedings) to be a realistic remedy if due process fails.
- ✓For non-workmen, plan around a civil damages claim rather than assuming reinstatement is available.
Talk to Us Before You Terminate, or Before You Respond to One
Whether you're an employer conducting a disciplinary inquiry or an employee facing termination, our employment team can guide the process and represent you before the Labour Court or in civil proceedings. Contact Global Law Company at 0333 4125951 or visit our chambers at 3rd Floor, Ahmad and Shafi Plaza, 13 Fane Rd, Lahore, 54000.
Frequently Asked Questions
Can an employer terminate me without a hearing?
Not lawfully. As seen in MCB v. Khawja Sajjad Mehmood (2002 PLC 120), a termination carried out without properly notifying the employee of the charges against them, effectively condemning them unheard, can be overturned on procedural grounds alone.
What is the difference between a "workman" and other employees?
"Workman" status, defined under industrial relations legislation, determines whether you can bring a grievance petition to the Labour Court and potentially seek reinstatement. Non-workmen, as held in MCB v. Muhammad Shafi (2002 PLC 124), generally cannot use the grievance route at all and must instead pursue an ordinary civil suit.
If I'm found guilty of misconduct, can I still get my job back?
Sometimes. In Pakistan Security Printing Corporation v. Mehmood Salahuddin (2017 PLCN 3), an employee was ordered reinstated with fresh (de novo) proceedings after the original inquiry was found procedurally deficient, even though the misconduct charge was ultimately proven on the retrial.
Is reinstatement always available if I win my case?
No. Under the "master and servant" principle applied in Muhammad Ibrahim Hajano v. PSO (2018 PLC(CS)N 135), some employees, particularly non-workmen with a properly conducted inquiry, are limited to a damages claim for wrongful dismissal rather than reinstatement.
Which law governs my termination, the Standing Orders Ordinance or the Industrial Relations Act?
Often both, in different ways. The Standing Orders Ordinance 1968 sets the substantive misconduct and termination procedure, while the Industrial Relations Act 2012 (or its provincial equivalents) governs the grievance/Labour Court process for enforcing your rights.