For foreign employers, Egypt Employers of Record (EORs) play a crucial role in recruiting skilled personnel in Egypt. These specialized employment and recruitment specialists possess the knowledge and expertise to navigate the hiring process efficiently. EORs also provide guidance on employment agreements and ensure compliance with local labor regulations, mitigating legal risks for businesses. Collaborating with an Egypt-based EOR enables companies to leverage the latter’s expertise in the domestic market, benefiting from streamlined HR procedures and acquiring the right talent.

Partnering with an Egypt Employer of Record (EOR) or Professional Employer Organization (PEO) helps employers hire from Egypt without a local entity. The experts from your EOR partner will also ensure you are compliant with local employment laws.

This is because Egypt’s employment laws have certain unique features that are different to your home country. For example, Severance pay is a must, if employees are terminated without a just cause. Moreover,  Egypt recognizes Islamic holidays, and these play a role in the working calendar. For example, during the month of Ramadan, working hours are reduced. Another point of concern would be trade unions. Historically, trade unions in Egypt were state-controlled. However, recent reforms and events have pushed for more independent labor movements. There are still regulations around forming or joining unions, and the process can be bureaucratic.

An Egypt EOR/PEO’s extensive understanding of the local market, including labor practices and cultural nuances, ensure HR processes are streamlined, and payroll, tax compliance, and benefits administration, are taken care of.

The cost of Egypt EOR/PEO services  differ based on various factors, such as the number of employees, the extent of services needed, and the intricacy of the project. The pricing structure for Egypt EOR/PEO services usually involves a monthly fee per employee or a percentage of the employee's salary. Extra charges may apply for additional services or customization.

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Key Metrics For Foreign Employers 

With a demographic dividend characterized by a high proportion of young individuals, Egypt benefits from a productive labor market. 

The table below depicts key indicators from the Global Talent Competitiveness Report for employers wishing to hire from Egypt.

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Source: The Global Talent Competitiveness Index 2023

Through the Gloroots’ Recrew platform, you can discover amazing talent in Egypt.

The term "misclassification of employees" refers to the inaccurate classification of workers by their employers. Misclassification occurs when an employer categorizes a worker as an independent contractor or exempts them from certain employment laws and benefits, even if the worker should be classified as an employee and entitled to legal protections, benefits, and rights.

Utilizing a PEO/EOR in Egypt  helps mitigate the risks associated with misclassification by ensuring compliance with labor laws, proper employee classification, accurate payroll processing, and access to comprehensive benefits. This enables businesses to focus on their core operations while entrusting employment-related responsibilities to experienced professionals.

Employment contracts

In Egypt, employment contracts must be in writing, whether for a fixed term, indefinite period, or a specific project. These contracts are written in Arabic and must be provided in triplicate: one for the employer’s records, one for the employee, and one for the social security authority. The contract typically includes essential details such as:

• Identification of both employer and employee
• Employment start date (and end date for temporary contracts)
• Work location
• Job description and responsibilities
• Salary and compensation, typically in local currency (Egyptian Pounds)
• Working hours
• Total number of holidays
• Notice periods for termination

Employers must also be aware of the legal nuances involved in these contracts. However, navigating these requirements doesn't have to be difficult. Gloroots’ Employer of Record (EOR) service streamlines the process, allowing businesses to easily hire and manage employees in Egypt, ensuring full legal compliance and freeing you from administrative complexities.

Contact us to learn more about how Gloroots can help with your hiring needs in Egypt.

Working hours

The standard working week in Egypt consists of 8 hours a day and 40 hours a week.

Overtime

Any hours worked beyond the standard 48 hours per week are considered overtime. Overtime pay is 135% of the regular salary for daytime work and 170% for nighttime work. If employees work on days off, they will receive double their daily wage and an extra day off the following week. Both the employer and employee must agree on working during days off in advance.

Minimum Wage

The minimum wage in Egypt is 7,000 EGP per month. For part-time workers, the minimum hourly wage is set at 28 EGP.

Sick Pay

In Egypt, employees who are unable to work due to illness or injury are eligible for paid sick leave. The maximum duration of sick leave is 180 days per year, during which time the employee is safeguarded from termination and receives sick pay from social security.

In the first three months of sick leave, employees receive sick pay equal to 75% of their social security salary, determined by certain criteria. After this initial period, the sick pay rate rises to 85%. To claim sickness benefits, employees must provide a medical certificate.

Annual Leave

For employers in Egypt, it's important to know that your employees are entitled to 21 days of paid annual leave if they've been with your company for at least six consecutive months. However, if an employee has completed ten years of continuous employment or is over 50 years old, their paid annual leave increases to 30 days. This is a legal requirement you should be aware of when managing your workforce.      

Maternity Leave 

Female employees in Egypt who have worked continuously for ten months are eligible for 90 days of paid maternity leave, with an additional 45 days after giving birth. They can take two separate maternity leave periods during their entire employment. When they come back to work, these women have the right to two thirty-minute nursing breaks each day or can combine them into one-hour breaks for up to two years following the baby's birth.

Paternity Leave

The law doesn't include any regulations or provisions related to paternity leave.

Employer Contribution

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Employer Payroll Contributions

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Employee Payroll Contributions

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Income Tax

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Termination Process

The process of terminating an employee depends on the type of contract and the agreement in place:

Project-Based Contract: Ends when the project finishes. The employee gets paid for their last month, any unused paid time off (PTO), and notice period (if mentioned in the contract).

Definite Contract: Ends on the contract's specified date. The employee gets paid for their last month, PTO, and notice period (if mentioned).

Indefinite Contract: The employee gets severance pay, a 2-month notice period, and PTO.

If an employer wants to fire an employee, they must go to a committee at the Ministry of Manpower and Migration, which has 15 days to decide. If the employee disagrees with the termination or the compensation package, they can challenge it in court.

Notice Period

In Egypt, the notice period depends on the employee's contract and how long they have worked for the company. If the employee has worked for less than ten years, the notice period is two months. For employees with more than ten years of service, the notice period is three months. No notice is needed during the probation period.

Severance Pay

For definite or indefinite contracts, employees are not entitled to severance pay unless their termination is unfair or the employer decides to provide it voluntarily. For project-based contracts, there is no severance pay unless the employer chooses to offer it voluntarily.

Probation Periods

Probation periods can last up to three months.

When hiring globally, ensuring compliance comes with its own set of battles. Employers must ensure all hiring and onboarding activities adhere to employment laws, payroll procedures, DE&I compliance, GDPR and similar data protection, etc. If you think it is hard to set up local entities and start hiring, keeping up with a dynamic compliance landscape is far harder. 

Gloroots helps you minimize all these efforts by providing a single window to manage all these tasks. Our in-house experts fully shield you from cross-border employment and payroll compliance risks. We do this by helping you with generating employment contracts, on-time payments, compliant benefits, while you focus only on screening talent. 

Our promise is a stress-free global employment experience for both you and your employee.

Contact our experts today to kickstart your global hiring campaign.

Growing a team means hiring the right employees at the right time and for the appropriate positions. Employers in Egypt must have a local legal organization and utilize local resources to handle compliance, payroll, tax, and benefits management. The complexity of employment regulations in Egypt makes compliance with employment laws demanding.

With Gloroots' global Employer of Record (EoR) service, you can let Gloroots handle the heavy lifting of payroll, tax, benefits, and compliance, allowing you to concentrate on what matters most: your employees and company growth.