Months after the February 2024 general elections, the new government, which came into power on the back of the popular vote, raised the minimum wage in the province, which has been blighted by skyrocketing inflation. But for 28-year-old office boy Hameed Qaiser, life continues just as it did before the polls, where he was trampled mercilessly by inflation when he picked up his cheque every month.
Qaiser's fate is shared by thousands of unskilled, semi-skilled and skilled workers in Pakistan's informal sector across Sindh.
After forming the government in the wake of the general elections, the Pakistan Peoples Party (PPP) on July 1, 2024, announced the provincial budget for the fiscal year 2024-25. As part of the budget, it announced that it was raising the minimum wage in the province to Rs37,000 (approximately $132) per month - in line with the announcement of the federal government. However, nearly four months later, neither Qaiser, nor thousands of workers are being paid the government-mandated minimum wage.
Qaiser told The Friday Times that even though the government had generously increased the minimum wage (up to $4.4 per day) in the province, he is still paid just Rs22,000 (around $78.94) per month.
One reason could be that while the provincial government had pencilled in the increase in the minimum wage in the provincial budget, it had yet to issue a formal notification for it. A summary sent to Sindh Chief Minister Murad Ali Shah by the Sindh Labour and Human Resources Department on October 18, the department proposed to increase the wages of unskilled workers to Rs37,000, semi-skilled workers to Rs38,280, skilled workers to Rs45,910, and highly skilled workers to Rs47,888.
The Sindh government claims that these measures aim to improve workers' welfare and ensure fair wages across various sectors. However, no formal notification has been issued yet, leaving the issue of minimum wages confined to the announcement stage.
"When I learned about the Sindh government's announcement a few months ago, I informed my office that inflation is rising and that the government had set the minimum wage at Rs37,000. I requested my superiors to raise my salary accordingly," Qaiser recalls, requesting not to be photographed for fear of losing his job, "If my photo is published, I'll lose my job."
His request to raise his salary to the government-mandated minimum wage, however, was not only denied but thrown back in Qaiser's face with a threat.
"The HR department of my company bluntly told me, 'If you want to work on the current salary, stay; otherwise, leave. We will hire someone else.' Upon hearing this, I realised I had no other option but to continue working here at the current salary," a crushed Qaiser relayed dejectedly before making plain the desperation of his situation, "Inflation is already high, and finding another job immediately is extremely difficult."
"I have no right to negotiate my salary with my office."
When asked whether Rs22,000 per month was sufficient to live off, Qaiser explained that of his salary, he spends around Rs8,000 ($28.82) or around 36.36% of his cheque simply on commuting to and from work. This leaves him with a paltry Rs14,000 ($50.44) for his household expenses and other personal needs.
In response to another question, Qaiser revealed that if anyone in his house falls ill or if he gets sick, they have no option but to rely on government hospitals or other charitable health institutions for treatment.
What makes Qaiser's situation worse is that unlike the expectation of un-skilled and semi-skilled workers to be either largely uneducated or have little to no education, this young man, forced to work as an office boy, had completed his graduation last year. However, with few employment opportunities, he has been forced to continue working as a semi-skilled worker in an office for three years, where he now qualifies to do skilled and highly skilled work.
When asked about young workers like Qaiser, who are forced to work in the informal sector on low wages, the Pakistan Peoples Party National Assembly representative for NA-243 (the constituency where Qaiser resides) said, "The National Assembly has approved an increase in wages in the budget for FY 2025, setting the minimum wage at Rs37,000."
When questioned further about workers from his constituency, NA-243, who are trapped in the informal sector on wages lower than the level set by the government, the MNA responded: "The relevant department has sent a summary to the Sindh government, and a notification will be issued soon."
He declined to comment further.
No official notification
Mehboob Rizvi, a lawyer who specialises in labour laws, told The Friday Times that although the Sindh government increases the minimum wage for the un-skilled, semi-skilled, skilled, and highly-skilled workers every year, it has continued to drag its feet for over three months to officially notify the increased wages for the fiscal year 2024-25.
"Had I refused to work at this salary, plenty of others were willing to accept the same [position and salary]. If I say this was a trick, it wouldn't be wrong" - informal sector worker Shumaila Imtiaz
A notification would mean that both formal and informal sectors would be bound by the Sindh government's order to implement the announced minimum wage, Rizvi explained.
However, Rizvi pointed out that such notifications have seldom been implemented in the province's informal sector.
"In Sindh, especially in Karachi, there is virtually no inspection system in place within the Labour Department. With a population (officially) exceeding 15 million, the monitoring system to ensure minimum wage implementation in the informal sector is extremely weak, which is why the notification has little effect on these workers."
Until the Sindh government establishes a robust mechanism to enforce the law on minimum wages, workers will continue to work for low wages.
Promises versus reality
An informal economy (also known as the shadow economy) refers to that part of the economy that is neither taxed nor has any form of government oversight.
A recent joint study conducted by the Small and Medium Enterprises Development Authority (SMEDA) and the International Labour Organisation (ILO) has revealed alarming new evidence of the continued expansion of Pakistan's informal economy.
The study estimates the total value of the country's informal sector is a staggering $457 billion, significantly overshadowing the formal economy, which was valued at $340 billion in 2023 according to official data. This suggests that the informal sector is nearly 64% larger than its formal counterpart.
The lack of oversight over the informal sector directly contributes to the exploitation of workers.
Twenty-six-year-old Shumaila Imtiaz recently started working as an administrative assistant at a call centre in the informal sector.
Speaking with The Friday Times, Imtiaz said, "When I interviewed with the company, my monthly salary was set at Rs40,000."
The offer convinced her to accept the position and join the company.
"However, when I was given the contract to sign after joining, I found that my salary was listed as Rs30,000. When I objected, I was told that this arrangement would be for the first three months as they only read about my work experience but didn't have firsthand knowledge of my work, so I would have to work for Rs30,000 for the first three months."
Imtiaz added: "Had I refused to work at this salary, plenty of others were willing to accept the same [position and salary]. If I say this was a trick, it wouldn't be wrong."
The young girl had voted for the ruling PPP in the provincial government elections in February but remarked that the government's declarations on minimum wage remain just that—declarations. She lamented that the provincial government's Labour Department has taken no significant action to improve the situation for workers in the informal sector.
"It seems like the government needs another century to enforce labour laws because, in the last 15 years, they haven't been able to resolve this critical issue," Imtiaz shared in a disheartened tone.
Following the National Conference on the Eradication of Forced Labour in Karachi, Sindh Minister for Labour and Human Resource Development Shahid Abdul Salam Thaheem told The Friday Times, "We are making concerted efforts this time [to resolve labour issues]."
"The hardest part is drafting the laws. Once that is done, the next phase is enforcement. We will soon release various statistical reports on this issue."
Thaheem promised that the Sindh government would soon issue a formal notification enforcing the minimum wage of Rs37,000 per month.
Pakistan is the first South Asian country to have a Business and Human Rights law under a National Action Plan. Labour rights experts believe that this is the only law which, if implemented effectively by provincial governments across the country, could significantly protect human rights and labour rights of workers in the informal sector
Zehra Khan, a Pakistani trade unionist and labour activist who serves as the General Secretary of the Home-Based Women Workers Federation (HBWWF), told The Friday Times, "Reports suggest that large businesses sometimes shift their operations to the informal sector or their subsidiaries, as the cost of doing business in the heavily regulated formal economy is much higher."
"Informal workers are largely excluded from formal social safety nets. They earn less and have fewer 'buffers' such as savings or access to government support programmes," Zehra continued.
This means the more businesses operate in the informal sector, the more vulnerable low-skilled workers will be to exploitation. Unfortunately, the government's indifference has not led to any substantial actions to address this crisis.
"In the informal sector, it often means that instead of the guaranteed minimum wage, employers can decide whatever monthly wage they please," Zehra elaborated.
She concluded, "I've been part of many government committees in the past. In my view, elections don't make as much of a difference as consistent enforcement of laws does to solve these issues."
Formal-informal sector limping laws practices
The Friday Times asked various experts and public and private institutions whether the country's formal sector was shrinking or expanding but received an inconclusive answer with an unclear horizon.
According to Noor Fatima, a senior research associate at the Research Society of International Law (RSIL), several international studies indicate that in countries where the informal sector is significant, private sector financial access is limited, labour productivity is low, capital accumulation—both physical and human—is slow, and financial resources are scarce. These factors are the primary drivers of worker exploitation in the informal economy.
Stalled business and human rights law
Nasir Mansoor, the deputy general secretary of the National Trade Union Federation (NTUF) of Pakistan, told The Friday Times that the National Action Plan (NAP) on Business and Human Rights (BHR) in Pakistan was developed through a consultative and comprehensive process and was approved by the federal cabinet in 2021. Following its initiation, the Ministry of Human Rights prepared an operational plan for its implementation, organising various consultative and awareness sessions to ensure stakeholder participation. Measures were also taken to guarantee broader inclusion and accessibility.
"However, the unstable political government and circumstances have severely impacted the implementation of this newly developed and comprehensive National Action Plan. This has particularly affected the Sindh provincial government, slowing down the execution of the plan," Mansoor added.
Mumtaz Mastoi, a legal expert, told The Friday Times that any legislation tends to be affected by political instability, which is why many laws identified under the National Action Plan have faced delays in their implementation at the provincial level.
"The Sindh government has before it a comprehensive plan from the National Commission for Human Rights concerning the Business and Human Rights law, yet its slow implementation could have various reasons," he said, adding, "However, I believe that political instability changes the government's approach, and as a result, important laws like this, which are merely in the implementation phase, are delayed."
Labour law experts told The Friday Times that Pakistan is the first South Asian country to have a Business and Human Rights law under a National Action Plan. Labour rights experts believe that this is the only law which, if implemented effectively by provincial governments across the country, could significantly protect human rights and labour rights of workers in the informal sector.
They argue that under this law, the economic conditions of workers associated with the informal sector could also be safeguarded and improved. Once implemented, it could help with the economic amelioration of these workers and lift them out of poverty.
Qaiser and Imtiaz exercised their right to vote in the 2024 elections, as they believed that while numerous labour protection laws have been passed in Pakistan, their elected representatives will help ensure their enforcement and safeguard their rights. Except their implementation has not been demonstrated to be a priority for their elected representatives post-election. They feel that millions of workers in Pakistan, like them, continue to face severe human rights violations every day.
"To be honest, I have no hope, but still, I will convince myself to vote again next time," Imtiaz concluded in a deep and sombre tone.