Egypt's new labour law came into force on 1 September 2025. It replaces the 2003 law that most employment contracts in the country were written under, and it changes enough that every employer with staff in Egypt — whether you employ ten people or ten thousand, whether you're local or a foreign company — needs to look at contracts, leave policies and payroll settings again.
This is a plain-English summary of the changes that matter most in practice. It is not legal advice; for your own situation, talk to us or to your lawyer.
The headline changes
Annual pay rise is now mandatory. Every employee must receive an annual increase of at least 3% of their social-insurance salary. This is the change most employers notice first, because it has to be built into the payroll budget every year.
Notice period is three months for everyone. Under the old law, notice depended on length of service — two months under ten years, three months above. Now it's three months regardless. This applies to both sides: the employee resigning and the employer ending an open-ended contract.
Annual leave has gone up. Fifteen working days in the first year, 21 days from the second year, and 30 days once an employee passes ten years' service or reaches the age of 50. Employees with disabilities get 45 days from day one.
Maternity leave is four months, up to three times. It was three months. At least 45 days of it must come after the birth, and there is no longer a minimum service requirement before an employee qualifies. Fathers now get paid leave on the day of the birth, which did not exist before.
Childcare leave is longer. Unpaid leave to care for a child can now be taken up to three times during an employee's service (it was twice), for up to two years each time, in companies with 50 or more staff.
Probation is capped at three months, once. You cannot put the same employee on probation twice.
Pre-signed resignation letters are worthless. The practice of having a new hire sign an undated resignation on day one — common in Egypt for years — is now explicitly invalid. A resignation has to be a real resignation, the employer has to respond to it within ten days, and it goes through the labour office.
Dismissal for misconduct now goes through the court. An employer can no longer dismiss an employee for a disciplinary reason on its own authority; it has to apply to the new labour court. This is a significant shift, and it makes documentation of performance and conduct issues far more important than it was.
Contracts
Contracts must be in writing, in Arabic, in four copies — one each for the employer, the employee, the social insurance office and the labour office. A foreign employee who doesn't read Arabic can have a second-language version alongside, but the Arabic text governs.
Remote work, part-time, flexible hours and job-sharing are now recognised in the law as normal employment, with the same rights and obligations as office-based work. If you have people working from home in Egypt on informal arrangements, this is the time to put them on proper contracts.
Fixed-term contracts remain allowed. The law introduces compensation of one month's salary per year of service when an employer ends certain fixed-term arrangements early; the exact scope of that rule is still being clarified in practice, so take advice before terminating a fixed-term contract before its end date.
Working time
The old ten-hour cap on actual working hours has been replaced with a twelve-hour cap on time present at the workplace, which is more workable for shift-based operations. Overtime no longer needs prior approval from the Ministry of Labour — you notify them within seven days instead.
Records and filings
Employee files must now be kept for five years after the employee leaves. Every employer also has to file an annual statement of its workforce with the Ministry, updated each January. For companies that have never kept formal HR records in Egypt, this is a new obligation with a fine attached.
Enforcement is stronger
Specialised labour courts now sit within every court of first instance and appeal, which should make disputes faster to resolve. Fines run from EGP 1,000 to EGP 100,000. A manager who knew about a breach and let it happen can be held personally liable alongside the company. And supplying workers to other businesses without a licence can now carry a prison sentence — which matters if you are using an informal manpower supplier rather than a licensed one.
Foreign nationals
Nothing fundamental has changed: a non-Egyptian still needs a work permit from the Ministry before starting, and the employer cannot put them to work without it. The new law restates this clearly and the penalties for getting it wrong are now higher.
What you should do now
- Check that every employment contract is in Arabic, in four copies, and reflects the new notice period and leave entitlements. Old contracts aren't void, but where they conflict with the new law, the law wins.
- Build the 3% annual increase into next year's payroll budget.
- Update your leave policy — annual, maternity, paternity, childcare — and tell your staff.
- Stop using pre-signed resignations if you ever did.
- Make sure your HR records are complete and will be kept for five years after each employee leaves.
- File the annual workforce statement, and diarise it for every January.
- If you use a manpower supplier, confirm it's licensed.
How GPS can help
GPS employs around 25,000 people on behalf of over 100 client organisations in Egypt, and every one of those contracts has been brought in line with Law 14/2025. If you'd rather not work through this yourself, two options:
- Employer of record — GPS is the legal employer of your Egypt-based staff. Contracts, payroll, social insurance, tax, leave and the filings above are all ours to get right. You direct the work day to day.
- HR outsourcing — you stay the employer; we run payroll, contracts, social insurance and the HR back office for you, including compliance with the new law.
Book a discovery meeting at gps4hr.com, or email info@gps4hr.com.
GPS — Global Professional Services. Your trusted HR partner in Egypt since 2009.