Dear Seniors, I would appreciate your expert opinion on the following matter in light of Pakistan’s labor laws and standard employment practices.
An ex-employee of the hospital, who served as Manager Administration from August 2015 to October 2025, has requested the hospital to pay gratuity for his service period from August 2015 to January 2020.
Please note the following background:
Hospital is a private, non-industrial healthcare organization.
The hospital did not have any Provident Fund or Gratuity policy in place prior to 2020.
A Provident Fund (PF) policy was introduced and implemented in February 2020, and the employee has already received his PF dues for the service period from February 2020 onward.
The employee now claims that it is a standard employment practice for every employee—whether managerial, administrative, or operational—to be entitled to either Provident Fund or Gratuity, and therefore requests gratuity for the pre-2020 period.
In this context, I would like to seek clarification on the following points:
Under the labor laws of Pakistan, is an employer legally required to pay gratuity for a past period during which no formal gratuity or provident fund policy existed in the organization?
If no such policy or scheme existed before 2020, can an ex-employee’s request for retrospective gratuity (for the period prior to policy implementation) be considered valid or enforceable?
What would be the recommended HR position to communicate to the ex-employee in such a case, keeping the hospital’s compliance and fairness in view?
Your guidance on this matter will be highly appreciated.
Warm regards,
Abdul Basit
From Pakistan, Karachi
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2An ex-employee of the hospital, who served as Manager Administration from August 2015 to October 2025, has requested the hospital to pay gratuity for his service period from August 2015 to January 2020.
Please note the following background:
Hospital is a private, non-industrial healthcare organization.
The hospital did not have any Provident Fund or Gratuity policy in place prior to 2020.
A Provident Fund (PF) policy was introduced and implemented in February 2020, and the employee has already received his PF dues for the service period from February 2020 onward.
The employee now claims that it is a standard employment practice for every employee—whether managerial, administrative, or operational—to be entitled to either Provident Fund or Gratuity, and therefore requests gratuity for the pre-2020 period.
In this context, I would like to seek clarification on the following points:
Under the labor laws of Pakistan, is an employer legally required to pay gratuity for a past period during which no formal gratuity or provident fund policy existed in the organization?
If no such policy or scheme existed before 2020, can an ex-employee’s request for retrospective gratuity (for the period prior to policy implementation) be considered valid or enforceable?
What would be the recommended HR position to communicate to the ex-employee in such a case, keeping the hospital’s compliance and fairness in view?
Your guidance on this matter will be highly appreciated.
Warm regards,
Abdul Basit
From Pakistan, Karachi
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Dear Abdul,
The situation you've described is indeed complex. Here's some guidance based on Pakistan's labor laws and standard employment practices.
1. Under the labor laws of Pakistan, there is no explicit requirement for an employer to pay gratuity for a past period during which no formal gratuity or provident fund policy existed in the organization. However, it's important to note that labor laws can vary based on the province, and it's advisable to consult with a legal expert or labor law consultant to get precise information.
2. As for the validity or enforceability of an ex-employee’s request for retrospective gratuity, it largely depends on the terms of employment and any agreements that were in place during the employee's tenure. If there was no explicit agreement or policy stating that gratuity would be paid, it may be difficult for the ex-employee to enforce such a claim. However, this doesn't necessarily mean that the claim is invalid. It's a matter of interpretation and application of the law, and again, consulting with a legal expert would be beneficial.
3. In terms of the recommended HR position, it's important to balance compliance with fairness. You could communicate to the ex-employee that while you understand and empathize with his request, the hospital did not have a formal gratuity or provident fund policy in place during the period in question. Therefore, there's no legal obligation for the hospital to pay the gratuity for that period. However, assure him that you will consult with a legal expert to ensure that you are fully compliant with all relevant labor laws.
Remember, it's crucial to handle this situation delicately to maintain a positive relationship with the ex-employee and uphold the hospital's reputation. It's always a good idea to seek legal advice in such matters to ensure that you're making informed decisions.
I hope this helps.
Best,
[Your Name]
From India, Gurugram
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The situation you've described is indeed complex. Here's some guidance based on Pakistan's labor laws and standard employment practices.
1. Under the labor laws of Pakistan, there is no explicit requirement for an employer to pay gratuity for a past period during which no formal gratuity or provident fund policy existed in the organization. However, it's important to note that labor laws can vary based on the province, and it's advisable to consult with a legal expert or labor law consultant to get precise information.
2. As for the validity or enforceability of an ex-employee’s request for retrospective gratuity, it largely depends on the terms of employment and any agreements that were in place during the employee's tenure. If there was no explicit agreement or policy stating that gratuity would be paid, it may be difficult for the ex-employee to enforce such a claim. However, this doesn't necessarily mean that the claim is invalid. It's a matter of interpretation and application of the law, and again, consulting with a legal expert would be beneficial.
3. In terms of the recommended HR position, it's important to balance compliance with fairness. You could communicate to the ex-employee that while you understand and empathize with his request, the hospital did not have a formal gratuity or provident fund policy in place during the period in question. Therefore, there's no legal obligation for the hospital to pay the gratuity for that period. However, assure him that you will consult with a legal expert to ensure that you are fully compliant with all relevant labor laws.
Remember, it's crucial to handle this situation delicately to maintain a positive relationship with the ex-employee and uphold the hospital's reputation. It's always a good idea to seek legal advice in such matters to ensure that you're making informed decisions.
I hope this helps.
Best,
[Your Name]
From India, Gurugram
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Gratuity case laws.pdf
Amended Labor Laws.doc