EOBI Contribution Rate 2026 — Current Numbers and Calculation
EOBI contribution rate trips up Pakistani employers because it is calculated on minimum wage (not actual salary) for most insured persons. Many companies wrongly compute it on actual salary, over-paying significantly. Here is the current 2026 rate, the correct calculation, and the payroll handling.
The contribution basis
EOBI contribution is calculated on the minimum wage in force, not on the employee's actual salary. This is the critical point most employers get wrong.
Why minimum wage? Because EOBI is a basic safety-net scheme designed for the lowest-paid workers; the basis is set to the minimum wage so contributions remain affordable for employers and employees.
The current contribution rates
The standard EOBI contribution rates have historically been:
- Employer share: 5% of minimum wage per insured employee per month
- Employee share: 1% of minimum wage per insured employee per month
Always verify the current rates on the EOBI website (eobi.gov.pk) since they have been revised in past years.
Worked Example
Assume the applicable minimum wage is PKR 40,000/month.
- Employer EOBI contribution: 5% × 40,000 = PKR 2,000/month per insured employee
- Employee EOBI contribution: 1% × 40,000 = PKR 400/month per insured employee
- Total EOBI per employee per month: PKR 2,400
For a 50-insured-employee company: PKR 120,000/month total EOBI obligation.
The common mistake — calculating on actual salary
Wrong calculation: PKR 150,000 actual salary × 5% = PKR 7,500 (employer)
Correct calculation: minimum wage PKR 40,000 × 5% = PKR 2,000 (employer)
The "over-paying" mistake costs employers significantly more than the law requires.
For employees above the insurable wage ceiling
EOBI has an insurable wage ceiling (revised periodically). Employees earning above the ceiling may not be mandatory EOBI contributors. Some employers continue contributions for benefit purposes, others do not — check the current ceiling and your scheme rules.
When minimum wage changes
Minimum wage is revised annually by each province. EOBI contribution amount changes automatically when minimum wage is revised because the basis changes.
Example: minimum wage revised from PKR 37,000 to PKR 40,000 → employer contribution goes from PKR 1,850 to PKR 2,000 per insured employee per month.
See: minimum wage by province.
The monthly payroll mechanics
Each month:
- Calculate employee EOBI deduction (1% of minimum wage)
- Display on payslip as a deduction
- Compute employer EOBI obligation (5% of minimum wage)
- This is an employer-side cost, not a deduction from employee
- Total (6% × number of insured × minimum wage) deposited to EOBI by deadline
- Monthly return filed with details per employee
What the payslip should show
- Basic salary
- Allowances
- Gross
- EOBI employee share (deduction)
- WHT (deduction)
- Other deductions
- Net pay
Employer EOBI share is not shown on payslip (since it's not a deduction) but is tracked in employer's books and the EOBI return.
For multi-province companies
If you operate in Punjab (minimum wage X) and Sindh (minimum wage Y), the EOBI contribution per employee depends on the minimum wage applicable to the employee's location. The HR system must apply the right minimum wage per employee.
Common EOBI rate mistakes
- Calculating on actual salary instead of minimum wage
- Using outdated minimum wage
- Wrong province minimum wage for the employee's location
- Forgetting to update when minimum wage is revised
- Mixing federal EOBI with provincial SS (different bases)
The Zaffre HRM EOBI rate handling
Zaffre HRM tracks minimum wage per location, applies current EOBI rate, calculates employer + employee contributions monthly, generates contribution data + monthly return. When minimum wage is revised, you update one setting and downstream calculations adjust. See: EOBI rules.
Critical caveat
EOBI rates and rules can change. Always verify against current EOBI notifications at eobi.gov.pk. Consult a labour-compliance advisor for specific cases.