Pakistan’s top constitutional court has delivered a landmark ruling strengthening EOBI pension rights for private-sector employees, clarifying that workers who narrowly miss the traditional service threshold are still eligible for benefits. The judgment emphasizes that welfare laws must protect contributors rather than impose rigid technical limits, directly impacting thousands of retirees and soon-to-retire employees who contributed to the Employees’ Old-Age Benefits Institution (EOBI).
A three-member bench led by Justice Ameenuddin Khan dismissed all EOBI appeals against previous Lahore High Court rulings and reaffirmed that employees completing 14 years and six months of service qualify for pension. The court ruled that any service period of six months or more counts as a full year, applying the rounding-off principle in pension calculations. This interpretation effectively treats such employees as having completed 15 years of service, giving them full pension rights.
The ruling overturns EOBI’s 2022 internal circular that restricted pension eligibility, clarifying that administrative policies cannot override statutory rights. Justice Hasan Azhar Rizvi, in the written judgment, reinforced that welfare institutions exist to serve contributors and that technical rigidity undermines the purpose of social security laws.
Private-sector employees who previously lost pension benefits due to minor gaps in service, along with those nearing retirement with 14.5 years of contributions, are expected to benefit most from this decision. Families relying on post-retirement income security will also gain from the strengthened protections. Nationwide, the ruling establishes a binding legal precedent, ensuring uniform pension treatment across Pakistan.
Following the judgment, EOBI is required to review pending applications, reassess previously rejected claims, consistently apply the rounding-off principle, and align pension processing with court directives. Non-compliance could lead to contempt proceedings and further litigation.
This decision reinforces the broader principle that social welfare laws prioritize human dignity and financial security. By protecting EOBI pension rights, the court has restored trust in welfare institutions, reduced financial vulnerability among retirees, and strengthened constitutional labor protections. The ruling confirms that pensions are earned social rights, not discretionary benefits, providing financial stability to deserving retirees and enhancing Pakistan’s social security framework.
