LAHORE: In light of a new ordinance, the Punjab government will now recruit employees on the basis of a lump sum pay package instead of making appointments on the basic pay scale, which means such employees will not be entitled to pensions anymore.

The Punjab Regulari­sation of Service (Repeal) Ordinance 2025 was promulgated on Oct 31 to repeal the Punjab Regularisation of Service Act 2018 and it was tabled in the Punjab Assembly as the house convened on Monday.

The reason behind the ordinance was that the provincial government intended to shift the mode of appointment from basic pay scale to a lump sum pay package so that the financial burden on the exchequer could be reduced which was borne by the government in the form of pensions.

By doing away with the 2018 law, the new ordinance, with immediate effect, has blocked the regularisation of services of contractual employees after four years in service.

The ordinance, however, protected all the decisions or actions taken under the repealed act, saying that “anything done or action taken under any provision of the repealed act, shall continue to have effect as if the said act had not been repealed”.

New recruitment to be made on ‘lump sum pay package’; ordinance laid in assembly for legislation three days after promulgation

The Punjab Regularisation of Service Act 2018 had offered that any person appointed on contract, immediately before the commencement of the act, shall be deemed to have been validly appointed and such appointment shall not be called in question.

The repealed act stated that a contract employee, who has been continuously serving for a period of four years shall be eligible to be considered for appointment on a regular basis if a regular vacancy is allocated for initial recruitment, subject to the fact that the employee is qualified for the post and shows satisfactory performance.

The revoked law had also given a procedure for the regularisation of contractual employees. It required that a contract employee be recommended by a specifically constituted commission to the appointing authority for regularisation.

The repealed act had also given a complete framework for appointments, termination of contract, determination of seniority, pay fixation, option for regularisation, legal framework, appeal or review, rules, removal of difficulties and savings.

Under the new policy being envisaged in the new act to be legislated by the Punjab Assembly, departmental recruitments will be made on a lump-sum pay package instead of the basic pay scale. According to the decision, the employees recruited on contract will stay on the contract mode for the rest of their service.

Officials say employees appointed on contract will not be entitled to a pension, as the move aims to reduce the financial burden on the provincial treasury caused by pension liabilities.

The ordinance caused some confusion as well about the fate of contractual employees appointed before the ordinance.

Some officials said the new ordinance did not impact them, while others claimed this would also affect the regularisation of the existing employees.

Law Secretary Asif Bilal Lodhi did not respond despite multiple attempts while Regulations Secretary Mian Abrar Ahmed confirmed that the law was repealed but refused to share further details about the impact of the new ordinance despite repeated requests.

A senior civil servant said the government should either offer regular job options or offer market-competitive salaries to its employees, adding that such a move would strengthen the quality of its human resources.

Published in Dawn, November 4th, 2025