Hiring guide in Egypt

What should I know about hiring in Egypt?

One of the first steps you should take if you want to do business in Egypt, whether to set up a new operation or to grow an existing one, is to find qualified local workers to join your team. But before you begin the recruitment process, you must learn about the local culture, labour laws, and other factors that may affect your hiring decisions. 

Working hours, wages, and other aspects of the workplace are all strictly governed by Egyptian law. These laws safeguard employees’ legal rights, and employers must honour them. 

In addition to paying their employees a fair wage and allowing them a reasonable number of hours per week to work, businesses are responsible for ensuring a safe workplace. When paying employees in Egypt, businesses must withhold a portion of each paycheck for the government and the social security system.

Why is Egypt a good choice for finding remote employees?

Egypt is a desirable location for companies seeking to hire remote workers due to the country’s strategic location and rich cultural heritage. Egypt is home to a sizable and diverse workforce, many members of which are well-versed in the English language. 

Its high number of college graduates in technically- and business-oriented fields makes it a promising source of remote talent. In addition, the Egyptian government provides tax breaks and subsidies to businesses that employ remote workers. 

Egypt is an excellent option for companies searching for remote workers due to the country’s large pool of skilled workers, cultural similarities, and supportive government policies.

How can Native Teams help you hire in Egypt?

For a streamlined hiring process in Egypt, Native Teams provides essential support through our Employer of Record services. Our solutions are crafted to navigate the intricacies of Egyptian employment regulations, cultural norms, business practices, and language considerations.

Our team of skilled tax and legal professionals acts as your trusted partner throughout the recruitment journey in Egypt. We ensure adherence to local payroll requirements, tax obligations, and HR documentation, allowing you to efficiently hire and integrate Egyptian talent into your remote team.

 Hire your first Egyptian employee with Native Teams.

Legal requirements for hiring in Egypt

Employers must follow a few essential laws and regulations to ensure a fully compliant employment process in Egypt.

Legal framework

Types of employment contracts

In Egypt, there are two main types of employment contracts that employers can offer, ensuring flexibility based on the nature of the job and duration of employment.

The first is a fixed-term contract, which is for a specific, pre-determined period, usually aligned with the completion of a project or a temporary role. These contracts have clear start and end dates and are often renewable if both parties agree. They are commonly used when the employer knows the duration of the work in advance, such as for seasonal jobs or temporary assignments.

The second type is an open-ended contract, which is more permanent and does not specify an end date. This type of contract is usually given when the employee is hired for an indefinite period, with the expectation of long-term employment. Open-ended contracts provide more job security for employees, as termination must follow legal procedures outlined in Egyptian labour law, including just cause or notice periods.

Both types of contracts must include key details like job role, salary, working hours, and other terms of employment, and they must be in writing to ensure compliance with Egyptian labour regulations.

Content of an employment contract

An employment contract in Egypt must include specific key elements to ensure compliance with labour laws and to clearly define the terms of the employee-employer relationship. First, it should state the job title and description, outlining the role, duties, and responsibilities of the employee. It should also specify the workplace location, whether it’s remote, in-office, or at multiple sites.

The contract must include the start date of employment, and for fixed-term contracts, the end date or the duration of the contract should also be mentioned. Working hours need to be clearly defined, following the legal standards of a maximum 48-hour workweek, and any provisions for overtime must be detailed, including compensation rates.

Additionally, the contract must state the salary or wage, including any bonuses, benefits, or allowances the employee is entitled to. It should also cover any probationary period (typically up to three months in Egypt), during which either party may terminate the contract with shorter notice. Leave entitlements, such as annual leave, sick leave, and maternity or paternity leave, should be included.

Another important element is social insurance information, which employers are required to provide to ensure the employee is covered under Egypt’s social security system. Finally, the contract must outline the termination procedures, including notice periods and grounds for dismissal, in accordance with Egyptian labour law.

Download a free employment contract for Egypt through Native Teams.

Oral, written or electronic employment contracts

Under Egyptian Labour Law, employment contracts must be in writing, in Arabic, and prepared in triplicate. One copy is kept by the employer, another by the employee, and the third is submitted to the social insurance office. This ensures that all parties involved have a clear and legally enforceable agreement.

Oral agreements, which may be valid in other jurisdictions, are not recognised for formal employment contracts in Egypt. As for electronic contracts, while not explicitly addressed by the Labour Law, they may be considered valid if they meet the written requirements, are properly documented, and are in Arabic. Additionally, electronic contracts must still be prepared in triplicate to ensure compliance with legal standards.

Working hours

In Egypt, working hours are regulated to ensure the protection of employees’ physical and psychological well-being. According to Law No. 133 of 1961, employees in industrial establishments are generally limited to working a maximum of eight hours per day or 48 hours per week, excluding meal and rest breaks. The law aims to balance productivity with employee health by setting these boundaries, though there is flexibility for different labour categories or industries where necessary, as determined by the concerned minister.

Article 82 further stipulates that the entire workday, including breaks, should not exceed ten hours. If an employee stays at the workplace during their break, that time is counted as part of their working hours. For employees engaged in intermittent work, as defined by the relevant minister, the total time spent at the workplace may extend up to twelve hours.

In exceptional circumstances where urgent or continuous work is required, employers are allowed to extend working hours beyond the standard limits. In such cases, employers must notify the relevant administrative authorities and obtain written approval, as outlined in Article 85. This ensures that any deviation from the standard working hours is closely monitored and approved by the appropriate governing bodies.

Breaks and night work

Egyptian labour law recognises the importance of regular breaks to maintain productivity and safeguard employee well-being. According to Article 81 of the Labor Law, employees are entitled to one or more break periods totalling at least one hour for meals and rest. Furthermore, employees cannot be required to work for more than five consecutive hours without a break, ensuring that they have sufficient time to recharge during the workday.

In terms of weekly rest, Article 83 mandates that employees must receive a rest period of at least 24 consecutive hours after working for a maximum of six continuous days. This rest period is considered paid time, reinforcing the law’s commitment to balancing work demands with employee recovery. These regulations are designed to promote both efficiency and the long-term health of workers in Egypt.

Annual leave

In Egypt, employees are entitled to paid annual leave under the Labor Law. After one year of service, employees receive 21 days of paid leave, which increases to 30 days after completing ten years of service or for those over 50 years old. Public holidays and rest days are not counted in the annual leave. Employees who have worked for less than one year are entitled to proportionate leave after six months of service.

Employees in strenuous or hazardous jobs are entitled to an additional seven days of annual leave, determined by ministerial decree. Students can choose their leave timing for exams, with at least 15 days’ notice. For juvenile workers, leave cannot be divided or postponed.

Employees must take at least 15 days of leave annually, with a minimum of six consecutive days. Employers set the leave schedule but cannot interrupt it except for compelling business reasons. If employees refuse to take their leave, they forfeit the right to compensation for unused days. Unused leave must be granted or compensated within three years, and if employment ends, employees are entitled to compensation for unused leave.

Employees who work for another employer during their leave without permission may have their leave wages withheld. After five consecutive years with the same employer, employees are entitled to one month of paid leave for the Hajj pilgrimage or visiting Jerusalem, granted only once during their service.

Public holidays

In Egypt, several national and religious holidays are observed, during which government offices and ministries are closed. These holidays include a mix of secular and religious celebrations:

• Coptic Christmas Day
• January 25th Revolution and National Police Day
• Eid Al-Fitr
• Sinai Liberation Day
• Labor Day
• Sham El-Nessim
• Eid Al-Adha
• June 30 Revolution Day
• Islamic New Year
• The July 23 Revolution Day
• Prophet Muhammad’s Birthday
• Armed Forces Day

These holidays reflect Egypt’s cultural and historical heritage, combining both religious significance and national pride.

Salary

In Egypt, the wage system is designed to ensure fair compensation for all employees, prohibiting discrimination based on sex, origin, language, religion, or creed. Wages are set through individual contracts, collective labour agreements, or company statutes. If not specified, workers are entitled to a wage appropriate for their role or, in the absence of standard trade rates, a wage determined by a designated committee based on fairness.

For workers paid by production or commission, their earnings must meet or exceed the minimum wage. Wages must be paid in legally recognized currency, with fixed-salary employees receiving monthly payments, while production-based workers are paid weekly or bi-weekly. When employment ends, employers must immediately pay all outstanding wages unless the worker voluntarily resigns, in which case payment is made within seven days of the claim.

To calculate the salary and taxes in Egypt, click here.

Sick leave

In Egypt, employees who are confirmed to be ill are entitled to sick leave, with the duration determined by a medical authority. For employees in industrial establishments governed by Law No. 21 of 1958, the sick leave policy is more structured. They are entitled to sick leave every three years of service, consisting of one month of full pay, followed by eight months at 75% of their salary, and an additional three months without pay, based on a medical assessment of their recovery prospects.

During the illness period, employees receive compensation according to the Social Insurance Law. Employees can also use any accrued annual leave in conjunction with their sick leave, or they may convert sick leave into annual leave if they have a sufficient balance. Additionally, collective labour agreements or company policies may outline terms for paid study leave, as per Article 55 of the law.

Parental and maternity leave

In Egypt, maternity leave is a key provision in labour regulations, granting female employees specific rights. Women who have worked for at least ten months are entitled to 90 days of maternity leave, covering both pre- and post-childbirth periods. This leave is fully paid, based on the employee’s comprehensive wage, and requires a medical certificate indicating the expected delivery date. Female workers are also exempt from work for 45 days following childbirth.

Maternity leave can be used up to twice during an employee’s service with the same employer. Additionally, female employees who are nursing are entitled to two half-hour breastfeeding breaks during the first 24 months after childbirth. These breaks are considered part of their working hours and do not result in a wage reduction.

Employers are prohibited from terminating a female employee during maternity leave, though if the employee works for another employer during this time, the original employer can recover the compensation paid. Furthermore, female workers in companies with 50 or more employees may take up to two years of unpaid leave to care for a child, which can be taken twice during their employment period. Paternity leave is not mandated by law in Egypt, meaning fathers do not have a statutory right to take leave after the birth of a child.

Termination of the employment relationship

Termination of employment in Egypt is governed by Labor Law No. 12 of 2003, which outlines both subjective and objective grounds for dismissal. Subjective grounds involve reasons related to the employee’s conduct or performance, such as misconduct, rule violations, or poor performance. Objective grounds refer to external factors like redundancy due to economic or technological changes.

For indefinite-term contracts, employers must provide advance notice depending on the employee’s length of service. In the case of fixed-term contracts, termination is more restrictive, requiring a court ruling to ensure that the dismissal is legally justified. Employers may also seek a court ruling for terminating indefinite-term contracts.

Article 61 of the Labor Law lists serious offences that justify termination without notice or severance pay, such as gross misconduct, repeated rule violations, negligence, absenteeism without cause, and breaches of confidentiality. Employers must follow due process, offering employees a chance to defend themselves and conducting proper investigations to ensure the termination is justified.

Termination must not be discriminatory. Employers should base their decisions on objective criteria such as performance, skills, or seniority, ensuring there is no bias based on gender, religion, race, or disability.

Ordinary dismissal by employer

Ordinary dismissal by an employer in Egypt can occur for objective reasons, typically related to economic, technological, or operational factors beyond the employee’s control. Redundancy may arise due to financial difficulties, restructuring, or technological advancements, leading the employer to no longer require the employee’s position.

For dismissals based on redundancy or workforce reduction, employers must seek approval from the Manpower Authority and provide documentation, such as financial records or restructuring plans, justifying the termination. Procedural requirements include providing notice periods or severance pay, depending on the terms of the employment contract or labour laws. The criteria for selecting employees for dismissal must be objective, fair, and non-discriminatory.

In cases of job elimination, the role becomes obsolete due to changes in the organization’s structure or technology. Force majeure terminations occur when unforeseen events prevent the continuation of the employment relationship. Fixed-term contracts end naturally upon expiry unless specified otherwise in the contract, and no notice or severance pay is required unless agreed upon. Additionally, statutory retirement age termination happens when an employee reaches the legal retirement age.

Notice period and challenging the dismissal

In Egypt, employees have specific rights when it comes to challenging unfair dismissal and are entitled to a defined notice period upon termination. If an employee believes their termination was unjust, they can file a complaint with the Ministry of Manpower and Immigration within 60 days of the dismissal. The Ministry will first attempt to mediate between the parties. If mediation fails, the employee can escalate the case to a labour court, seeking either reinstatement or compensation for wrongful termination.

The notice period for termination is determined by the employee’s length of service:

• Two months for employees with less than ten years of service.
• Three months for employees with over ten years of service.

During the notice period, employees continue to work and receive their regular pay, unless the employer opts to provide payment in lieu of notice, releasing the employee from their duties. Labour courts have the authority to review termination cases, and either party may appeal a court’s decision through higher labour courts.

Rights and obligations of unemployed individuals

In Egypt, unemployed individuals may receive financial support under specific conditions. To qualify for unemployment benefits, they must meet key criteria, including:

• At least six months of social insurance contributions, with the last three made just before unemployment.
• The individual must not have left work voluntarily or been dismissed for misconduct.
• They must be actively seeking work, registered with the manpower office, and willing to accept suitable job offers.

Eligible individuals receive 60% of their last monthly wage in unemployment benefits for up to 16 weeks. If they have contributed for 24 months or more, this period extends to 28 weeks.

While receiving benefits, individuals must actively seek employment, accept suitable job offers, and may be required to attend training programs. Regular updates to the manpower office about their job search are mandatory. Failing to meet these obligations can result in suspension or termination of benefits.

Severance pay

Severance pay in Egypt offers financial protection for employees upon termination. If an employer terminates an indefinite-term contract without a valid reason, the employee is entitled to severance pay. This is calculated as half a month’s salary for each of the first five years of service, and one month’s salary for each additional year.

In cases of termination due to economic reasons, severance pay remains mandatory, following the same formula. The amount is based on the employee’s basic salary and housing allowance, and must be provided at the time of termination.

Employees who resign after 10 years of service receive half the severance pay they would be entitled to if terminated. However, employees dismissed for serious offenses or resigning without proper notice may forfeit or have their severance pay reduced. Retirement-age employees who receive a pension may not be eligible for additional severance.

Employees can challenge severance pay calculations or dismissal grounds in labor courts, ensuring their rights are protected.

Probationary period

The Egyptian Labor Law allows employers to include a probationary period in employment contracts, though it is not mandatory. This period acts as a trial phase, enabling both the employer and the employee to assess whether the employment relationship is mutually beneficial. During this time, the employer can evaluate the employee’s performance, skills, and overall fit within the company.

However, including a probationary period is optional, and employers should weigh its advantages and disadvantages when drafting contracts. According to Article 33 of the Egyptian Labor Law, the maximum duration of a probationary period is three months. Employers are prohibited from extending this period, even if the initial probation is shorter than the allowed three months.

Furthermore, once an employee has completed the probationary period, they cannot be subjected to another probation for the same position with the same employer. This ensures that the probationary period is a one-time opportunity for both parties to evaluate the employment arrangement before transitioning to a more permanent status.

Prohibition of competition

Under Egyptian labor law, employers have the right to impose non-compete clauses within employment contracts to protect their business interests after the termination of the employee’s contract. These clauses prevent employees from working for competitors or starting a competing business within a specific time frame, geographic area, and for a specific industry.

However, such clauses are subject to legal limitations. The restrictions must be reasonable in terms of duration, geographic scope, and the type of activity restricted. Typically, the non-compete period cannot exceed two years after the employee’s departure. If the employee is terminated without just cause, or if the employer has not provided compensation for the duration of the non-compete, the clause may not be enforceable.

Employers must ensure that the non-compete clause is clearly outlined in the employment contract to avoid disputes. Any violation of the non-compete agreement by the employee can result in legal consequences, including the payment of compensation to the employer.

Intellectual property rights

In remote work settings, intellectual property (IP) rights play a vital role in protecting both the company’s and employees’ creations, ideas, and innovations in Egypt. Employers should clearly define IP ownership in employment contracts, specifying that work products created during working hours or within the scope of employment belong to the employer. 

Non-Disclosure Agreements (NDAs) should also be signed to safeguard confidential information, ensuring that sensitive data or ideas are not shared with competitors or the public. Furthermore, any intellectual property created using company resources or during work hours is typically owned by the employer, and this should be clearly communicated to employees.

To protect IP when employees work remotely, employers must ensure the use of secure networks and digital tools, in compliance with data protection and cybersecurity laws. By establishing clear IP policies, companies can safeguard their assets and maintain a secure work environment for remote employees.

Employee data privacy

Employee data privacy is a critical aspect of remote work, as the use of digital tools and remote access to company systems increases the risk of data breaches. Employers must comply with data protection laws, such as Egypt’s Personal Data Protection Law, ensuring that employees’ personal information is collected, processed, and stored securely.

Companies should implement robust cybersecurity measures, including encrypted communications and secure access controls, to protect sensitive employee data. Additionally, clear policies should be put in place to inform employees about what data is collected, why it’s collected, and how it will be used. Employees should also be educated on data privacy best practices and the importance of safeguarding their personal information.

Remote working policy

With the rise of digital transformation in Egypt, there has been a notable shift toward remote working, supported by governmental initiatives to enhance the use of electronic communication and information technologies. The growth of digital tools has revolutionized working models, offering increased flexibility for employees in terms of when, where, and how they work. This shift is particularly evident in sectors such as corporate services, banking, healthcare, education, taxation, and social insurance.

To support remote work, several key laws have been introduced to regulate digital and remote work environments:

• E-payment Law No. 18/2019: Governs the use of electronic payment systems.
• Anti-Cybercrime Law No. 175/2018: Regulates cybercrime and enhances digital security.
• New Banking Law No. 194/2020: Deals with e-banking and financial technology.
• Unified Tax Procedures Law No. 206/2020: Implements electronic tax reporting and collection systems.
• New Customs Law No. 207/2020: Establishes an electronic system for tracking goods and exchanging documents.
• New Consumer Protection Law No. 181/2018: Regulates e-commerce and remote contracts.
• Personal Data Protection Law No. 151/2020: Addresses the protection of personal data, ensuring privacy in the digital space.

This ongoing digital transformation enables more flexible work arrangements, facilitating the execution of job responsibilities either fully or partially outside of the traditional office environment, through the use of technology.

Responsibilities within a remote work arrangement

As remote work grows in Egypt, employers must ensure the secure and efficient implementation of remote models. Key responsibilities include:

1. Tools and Infrastructure: Provide necessary hardware, software, and internet access for remote work.
2. Cybersecurity: Implement strong security measures and train employees on data protection, complying with Egypt’s Anti-Cybercrime Law.
3. Data Protection: Follow the Personal Data Protection Law and ensure secure handling of personal data.
4. Confidentiality: Employees should sign NDAs to protect sensitive information.
5. Contract Clauses: Include non-compete and non-solicitation clauses in employment contracts.
6. Data Privacy: Establish clear data security protocols and secure communication platforms.

These measures ensure a secure and effective remote work environment.

Health and safety at home

With the rise of remote work, employees are exposed to unique risks that differ from those in traditional office settings. 

1. Work Hours and Breaks: Establish clear work hours and encourage regular breaks to prevent burnout, ensuring employees have the “right to disconnect” after working hours.
2. Mental Health Support: Provide access to counselling, organize virtual team-building activities, and ensure regular check-ins to address potential mental health challenges.
3. Ergonomics: Offer guidance on setting up an ergonomic home office and provide financial support for necessary equipment.
4. Health and Wellness Programs: Promote virtual fitness classes, stress management workshops, and nutrition advice to encourage healthy habits.

These steps ensure that remote workers maintain both physical and mental well-being.

What are the advantages of hiring employees from Egypt vs other countries?

Hiring employees from Egypt offers several advantages over sourcing talent from other countries. First, Egypt has a large and growing talent pool, particularly in fields such as technology, engineering, healthcare, and business services. The country’s strong emphasis on education, along with an increasing number of skilled professionals, makes it an attractive option for companies seeking expertise. 

Second, Egypt’s time zone aligns well with many regions, including Europe, the Middle East, and parts of Asia, facilitating real-time collaboration and communication for companies operating internationally. This can boost productivity and streamline teamwork across borders. Additionally, labour costs in Egypt are highly competitive, particularly when compared to Western countries. While navigating local labour laws may require some attention, the overall cost of hiring skilled professionals in Egypt can be more affordable, allowing companies to optimize their budgets.

Furthermore, Egypt’s strategic geographic location, serving as a gateway between Africa, the Middle East, and Europe, offers businesses access to emerging markets in the region. Hiring employees from Egypt can help companies establish a foothold in these key markets. 

Lastly, Egypt has a rich cultural heritage, and many employees are proficient in English, particularly in the tech and business sectors. This cultural and language proficiency can be an asset for companies looking to engage in international markets or collaborate with global teams.

Overall, hiring employees from Egypt provides a combination of skilled talent, cost efficiency, and strategic positioning that can help enhance a company’s competitive edge in the global market.

Why use Native Teams for hiring in Egypt?

Native Teams lets you employ team members ‘like a local’ meaning you get all the benefits of a global team, wherever you are based. Here are the reasons why you should use Native Teams for hiring:

• No paperwork: We will handle all the necessary paperwork for you.
• Save on taxes: We help you handle your taxes.
• No company set up: You can expand your business using our company entitles.
• Online onboarding: We’re here to ensure your onboarding process is trouble-free.
• No accounting: We will handle all of your accounting needs, including invoicing, payroll, and more.
• Increase your profit: We assist you in growing your business and maximizing your profits.
• Compliance expertise: we can assist your company in navigating the regulatory environments and ensure you meet all relevant requirements.
• Local support: We can assist you in understanding and complying with the relevant local laws.