ISLAMABAD: The federal government has approved a record Rs25.255 billion severance and compensation package for employees of the Utility Stores Corporation (USC) who lost their jobs after the closure of the state-run retail chain.
According to the agreement, affected workers will get six months’ house rent and 40 per cent of Rs19.5 billion as compensation in the first phase. An additional Rs5.75 billion has been set aside for widows and other terminal dues.
The agreement was signed between the government and the All Pakistan Utility Stores Corporation National Workers Union, which represented the employees. The document states that payments will be released in phases to ensure smooth disbursement.
Under the plan, after 80 per cent of the first instalment is paid, the government will release a second instalment of 30 per cent, followed by a final 30 per cent payment.
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Officials said the package will support thousands of workers affected by layoffs up to August 2025, including employees removed in February, May and November 2025. The Utility Stores Corporation was established in 1971 and served the public for decades.
Compensation amounts will be paid based on length of service and type of employment. Special arrangements have been made for contract employees, daily wage workers and other vulnerable groups.
The total compensation for widows is Rs684 million, while farewell grants for outgoing employees amount to Rs5.067 billion. The package also includes leave encashment, house ceiling payments and other terminal benefits.
In return, the workers’ union accepted the package as a full and final settlement and agreed not to pursue any future legal cases or claims related to the layoffs or closure of the Utility Stores Corporation.
