pakistan - fair labor association

pakistan

www.fairlabor.org 1

STATUTORY AND RECORDED WAGE & MONETARY INCOME LEVELS

Benchmark calculation notes source monthly value (Pkr)

Legal Minimum

• LegalminimumwagebeforeJuly1,2015was12,000PakistaniRupees(PKR).Ithasbeenincreasedto13,000sincethen.

• FLAcompensationdatafromPakistanwascollectedbefore July1,2015,sotheoldlegalminimumapplies.

12,000 before July 1, 2015;

13,000 afterwards

Industry/ sector Wage Comparator

Average Monthly Wage of

Manufacturing

• Valuecomesfroma2013-2014LaborForceSurveyconductedbyStatisticsDivision,PakistanBureauofStatistics,GovernmentofPakistan.Thesurveyusesnationallyrepresentativesample,andfortheyearof2013-14,thesamplesizecomprises41,484households.

• PKR12095istheaveragemonthlywageforplant/machineoperatorsandassemblers.SeeTable31“AverageMonthlyWagesofEmployeesbyMajorOccupationalGroups”(page37).

• AdjustedforinflationusingIMFWEOCPI(to2015value):12642.4

Labour Force Survey (LFS)

2013-14, Pakistan Bureauof Statistics

12,642.4

INCOME AND POVERTY BENCHMARKS

National Poverty Lines

(2 adults)

• PovertylinedevelopedbyMinistryofPlanning,DevelopmentandReform.

• TheofficialpovertylineinPakistaniscalorie-based,andconsumption-basedabsolutepovertyisestimatedafterconvertingthehouseholdconsumptionleveltoadultequivalentbasedonrecommendednutritionalrequirementsof2350caloriesperpersonperdayandprovidinganalmostequivalentamountforotherbasicneeds.

• Povertylineis1745in2010-11.

• AdjustedforinflationusingIMFWEOCPI(to2015value):2361

• Twoadultequivalentconsumptionunits:4722

Ministryof Finance- Pakistan

World Bank ‘international poverty line’ (2011 PPP$ 3.10/day)

• PovertyismeasuredbytheWorldBankatPurchasingPowerParity(PPP)$3.10/day.

• The$3.10equivalentis(28.34*3.1)=PKR87.85

• Onamonthlybasis,thisis(PKR87.85*(365/12))=PKR2,672.23.

• Adjustedforinflation,thisamountis[198.16(CPI2015)/189.58(CPI2014)*PKR2,672.23]PKR2,793.17/person/month

• ThehouseholdequivalentofPKR2,793.17,assumingtwoconsumptionunitsandoneearnerisPKR5,586.33/month.

WB2011 icP

5,586.33

• ThehouseholdequivalentofPKR2,793.17,assumingthreeconsumptionunitsandoneearneris8,379.50/month.

8,379.50

pakistan

www.fairlabor.org 2

INCOME AND POVERTY BENCHMARKS

Living Wage Estimate

Asia Floor Wage

(3 adults, 1 earner)

• AsiaFloorWageAlliance(latestrevisionfoundfrom2015—1021PPP$)—AstandardPPP$-basedestimatefor EastandSoutheastAsiancountriesapplicableto manufacturingindustries(basedona3,000-kcaldietfor athree-adult-equivalenthouseholdwithasingleearner)

• FoodbasketresearchwasdoneinCambodia,India,Indonesia,andSriLankatoobtainthecountryAsiaFloorWagefigures.ForotherAsiancountrieswherefoodbasketresearchwasnotconducted,thefigureswereextrapolated.

AsiaFloor Wage Alliance

31,197

Union Demand

(Minimum Wage)

• UnionshadbeendemandingforminimumwagestobefixedbetweenPKR25000toPKR30000.ThecurrentminimumwageisfixedforeachprovinceandataboutPKR13000.

Pakistan textile/garment worker unions

(various), 2015

25000 to 30000

COMPENSATION COMPARISON ACROSS FACTORIES PAKISTAN Currency: Pakistani Rupee (PKR)

Factory 1

Factory 2

Factory 3

Factory 4

Factory 5

Factory 6

Asia Floor Wage [3 adults, 1 earner](net): 31,197

Union minimum wage demand by Pakistan textile/garment worker unions (various), 2015: 25,000 -30,000

Average Monthly Wages in Manufacturing: 12642.4

Legal Minimum Wage: 12,000

World Bank ‘international poverty line’ (2011 PPP$ 3.10 / day)[3 consumption units, 1 earner](net): 8,379.50

World Bank ‘international poverty line’ (2011 PPP$ 3.10 / day)[2 consumption units, 1 earner](net): 5,586.33

National Poverty Line [2 adults, 1 earner](net): 4,722

Range between median compensation for highest and lowest paid occupation type

MEDIAN FACTORY COMPENSATION COMPARED TO BENCHMARKS PAKISTAN (1) Currency: Pakistani Rupee (PKR)

Occupation 1 Occupation 2 Occupation 3 Occupation 4

OCCUPATION

Asia Floor Wage 2015 (net): 31,197

Union Minimum Wage Demand by Pakistan textile/garment workerunions (various) 2015: 25,000-30,000

Average Monthly Wages in Manufacturing: 12,642.4

World Bank ‘international poverty line’ [3 consumption units, 1 earner](net): 8,379.50

National Poverty Line (net): 4,722

Gross Compensation includes Basic Contracted Wage, Cash Benefits, and In-kind Benefits. Net compensation subtracts Legal Deductions and Taxes.

Occupation Net Compensation

Gross Compensation

Occupation 1 13500 13500 Occupation 2 13761 13761 Occupation 3 13761 13761 Occupation 4 12638 12638

Sewing(35.95%)

Finishing(12.81%)

Cutting(5.54%)

Packing(5.35%)

OCCUPATION

Gross Compensation

Sewing 13019 13023 Finishing 13016 13020 Cutting 12998 13002 Packing 13015 13019

Stitching(43.41%)

Printing(27.03%)

Packing(22.64%)

Cutting(6.92%)

OCCUPATION

Gross Compensation

Stitching 16048 16128 Printing 15754.83 15834.83 Packing 16604.66 16684.66 Cutting 16238.66 16318.66

Sewing(55.38%)

Finishing(12.31%)

Cutting(10.77%)

OCCUPATION

Gross Compensation

Sewing 15000 15000 Finishing 12000 12000 Cutting 13000 13000

Sewing(47.49%)

Cutting(18.65%)

Finishing(14.06%)

Packing(1.58%)

OCCUPATION

Gross Compensation

Sewing 17822 17822 Cutting 15484 15484

Finishing 16269 16269 Packing 27786.5 27786.5

Sewing(54.68%)

Finishing (19.21%)

Cutting (6.9%)

Packing(3.94%)

OCCUPATION

Gross Compensation

Sewing 28566.5 28566.5 Finishing 13198.5 13198.5 Cutting 13474 13474 Packing 13441 13441

pakistan - fair labor association

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