Payroll Compliance: Staying Aligned with Egyptian Labor Laws

What payroll compliance in Egypt requires now

Payroll compliance in Egypt now means following Labour Law No. 14 of 2025, in force since 1 September 2025: an annual increment of at least 3% of the insurance wage, written Arabic contracts in four copies, three months' notice for open-ended contracts, labour-office approval for resignations, and a statement of workers every January.

Most of these rules change a figure on the payslip. Each section below gives the article number in the law as published in the Official Gazette, and our guide to Egypt's recent tax reforms and their impact on businesses covers the tax side.

What Is Labour Law No. 14 of 2025?

It is Egypt's general employment law. Labour Law No. 14 of 2025 was published in the Official Gazette (Issue 18, continued) on 3 May 2025, took effect on 1 September 2025 and repealed Law No. 12 of 2003. It does not cover employees of state bodies, local administration units and public authorities, or domestic workers (issuing Article 1).

Specialised labour courts set up by the law have heard employment disputes since 1 October 2025 (issuing Article 13). Better terms that workers already have under their contracts, company rules or custom continue (Article 6).

What Changed for Payroll

Five figures that employers calculated under the old law have changed. The old-law column is shown for comparison.

Employment Contracts

• Write every contract in Arabic, in four copies: one for you, one for the worker, one for the social insurance office and one for the labour office (Article 89).
• The contract must state at least the start date; your name and workplace address; the worker's name, qualification, occupation, social insurance number, address and identity details; the type of work; and the agreed wage, how and when it is paid, and any other cash or in-kind benefits (Article 89).
• A foreign worker who is not proficient in Arabic may sign a contract in Arabic and their own language. The Arabic text prevails if the two differ (Article 89).
• Probation lasts three months at most, and a worker can be on probation only once with the same employer (Article 90).
• A fixed-term contract is allowed when the nature of the work requires it, and it can be renewed by agreement (Article 87). A contract counts as open-ended if it is not written, states no duration, or continues after its term without a new written agreement (Article 88).
• Remote work, part-time work, flexible hours and job sharing are recognised forms of work (Article 96). Each needs a written contract, on paper or electronic (Article 99).

Minimum Wage, Annual Increment and Payment

What is the minimum wage in Egypt's private sector?

7,000 EGP a month since 1 March 2025, under a decision of the National Council for Wages in February 2025. The council sets minimum wages for every sector (Article 102), and no worker may receive less (Article 108). No later private-sector decision had been announced at review, so confirm the figure with the Ministry of Labour before setting salaries.

How much is the annual increment?

At least 3% of the insurance wage, meaning the wage on which social insurance contributions are paid. It falls due one year after hiring or after the previous increment (Article 12). The council's February 2025 decision also set a floor of 250 EGP a month for the private sector.

An employer whose economic circumstances make the increment impossible to pay can refer the case to the National Council for Wages, which decides within 30 days (Article 12).

When and how must wages be paid?

• Pay monthly-paid workers at least once a month and other workers at least once a week, unless agreed otherwise. Where pay is by production or commission and the job takes more than two weeks, make a weekly payment on account and pay the balance in the week after delivery (Article 108).
• Pay on a working day, at the workplace, in legal tender or into the worker's bank account (Article 108).
• A payment counts only when the worker signs the wage register or payroll sheet, or the money reaches their bank account. Give each worker a statement of their pay items (Article 115).
• When employment ends, pay everything due within 7 days of the worker's request (Article 108).

What can you deduct from wages?

Loan or advance repayments of up to 10% of the wage, with no interest (Article 113); seizures and debt deductions of up to 25%, or 50% for alimony, after income tax, social insurance and loan repayments (Article 114); and disciplinary deductions of no more than five days' basic wage a month (Article 143).

When claims compete, alimony comes first, then your own claims, and a worker's assignment of wages needs their written consent (Article 114). Recovering the value of items a worker lost or damaged needs an investigation and notice first, and is capped at five days' wage a month and two months' wage in total (Article 151).

The law separates the basic wage, meaning the contract wage and its increases, from the variable wage: commissions, bonuses, allowances, profit shares, tips and benefits in kind (Article 1).

Working Hours, Rest and Overtime

• No more than 8 hours a day or 48 hours a week, not counting meal and rest breaks (Article 117).
• Breaks of at least one hour in total, and no more than 5 hours in a row without one (Article 118).
• From start to finish, a working day may span 10 hours at most (Article 119).
• At least 24 consecutive hours of paid weekly rest after no more than six working days (Article 120).
• Post the weekly rest day, working hours and breaks at the main entrances, and send the labour office a copy, and any change, within 7 days (Article 122).

How is overtime paid?

Overtime is allowed to meet unusual work needs or exceptional circumstances. Notify the labour office within 7 days with the reason and the time needed, and keep time at the workplace within 12 hours a day. Each overtime hour earns at least the hourly wage plus 35% by day, or 70% at night (Article 121).

From the sixth month of pregnancy, a worker's daily hours are cut by at least one hour, and she may not be required to work overtime while pregnant or for six months after the birth (Article 54). A nursing mother gets two paid breaks of at least 30 minutes a day for two years after the birth (Article 56).

A Worked Example: One Worker's Payroll

The figures assume a monthly wage of 9,000 EGP that is also the insurance wage, a 30-day month (Article 2) and an 8-hour day.

Your contract or company rules may define the hourly rate differently; use that definition where it exists.

Leave Entitlements

You set the timing of annual leave, but each worker must take at least 15 days a year, six of them in a row, and cannot give up leave. Settle balances, as leave or cash, at least once every three years, and pay any unused balance when employment ends. A worker who refuses in writing to take leave on the dates you set loses the right to be paid for it (Article 125).

Ending Employment: Notice, Dismissal and Resignation

How much notice is required?

At least three months' written notice to end an open-ended contract, whoever gives it and whatever the length of service (Article 156). A longer period may be agreed, but notice cannot be waived or shortened, except that you may waive it when a worker resigns (Article 161).

You can end the contract only for a legitimate and sufficient reason (Article 157). You cannot give notice while a worker is on leave: notice runs from the day after the leave ends, and sick leave during the notice period pauses it (Article 159). During your notice, the worker may take one paid day, or eight hours, a week to look for work (Article 162). If you end the contract without notice, you pay the wage for the notice period or what remains of it (Article 164).

What compensation is due?

Ending an open-ended contract without a legitimate reason costs at least two months' wage per year of service, on top of the worker's other rights (Article 165). If you end a fixed-term contract, you owe one month's wage per year of service (Article 154). A worker on maternity leave cannot be dismissed (Article 55).

Can you still dismiss a worker for misconduct?

What makes a resignation valid?

A resignation must be written, signed by the worker or their special agent and approved by the labour office. You have 10 days to decide; otherwise it counts as accepted. The worker can withdraw it in writing, with the same approval, within 10 days of being told it was accepted (Article 167).

Unexcused absence of more than 20 separate days in a year, or more than 10 days in a row, counts as resignation only if you first sent a warning by registered letter with acknowledgment of receipt: after 10 days' absence in the first case, or after 5 days in the second (Article 166).

What is due when employment ends?

Pay all dues, including unused annual leave, within 7 days of the worker's request (Articles 108 and 125), and issue a certificate of service within 15 days of a request (Article 175). A release giving up the worker's rights is void if signed during employment or within three months after it ends (Article 6).

The retirement age cannot be set below 60 (Article 171).

Records and Reporting

• Keep a file for each worker, on paper or electronically, for at least five years after the job ends, and until any dispute is finally decided (Article 92).
• Keep paper or electronic records of each worker's details and the wage due to them (Article 105), backed by signed payroll sheets or bank transfers (Article 115).
• Within 30 days of starting operations, send the labour office a detailed statement of your workers by qualification, occupation, age group, nationality, gender and wage. Every January, send any changes, the jobs vacant or abolished, and your expected staffing needs (Article 36).
• With 10 or more workers, prepare internal work regulations covering at least promotion, transfers, wages, violations and disciplinary penalties within 60 days. Submit them to the labour office for approval and post them where workers can see them (Article 137).
• With 30 or more workers, pay the training fund 0.25% of the minimum insurance wage per worker each year, at least 10 EGP and at most 30 EGP per worker. Establishments that train their own workers can be fully exempted (Article 21).
• With 20 or more workers, pay the Social, Health and Cultural Services Fund a yearly subscription of 8 to 16 EGP per worker, as set by the Minister of Labour (Article 273).

Social Insurance and Salary Tax

Social insurance and income tax sit outside the labour law, but they run through the same payroll.

• Under the Social Insurance and Pensions Law No. 148 of 2019, the employer pays 18.75% and the employee 11% of the insurable wage. From 1 January 2026, the insurable wage is at least 2,700 EGP and at most 16,700 EGP a month.
• Register each new worker with the National Organization for Social Insurance (NOSI) on Form 1 within two weeks of their start date.
• Deduct 0.05% of each employee's gross monthly pay for the Martyrs Fund.
• Withhold salary income tax every month and pay it through the Egyptian Tax Authority's payroll tax system.

Payroll Compliance Checklist

1. Give every worker a written Arabic contract in four copies, with probation of three months at most.
2. Register each new worker with NOSI within two weeks of their start date.
3. Pay at least the current minimum wage, 7,000 EGP a month in the private sector since March 2025, and check it before every pay review.
4. Apply the annual increment of at least 3% of the insurance wage on each worker's due date.
5. Pay monthly-paid staff at least monthly and others at least weekly, with a signed payroll sheet or bank transfer and a pay statement for each worker.
6. Keep loan repayments within 10% of the wage and other debt deductions within 25%, or 50% for alimony.
7. Track hours against 8 a day and 48 a week, pay overtime at 35% by day and 70% at night, and notify the labour office within 7 days.
8. Keep a leave record for each worker and settle balances at least every three years.
9. Send the statement of workers to the labour office every January.
10. Keep each worker's file for five years after they leave.

Four habits that keep payroll compliant

• Record-keeping: keep contracts, payroll sheets, leave and overtime records in each worker's file, ready for an inspector.
• Payroll automation: use payroll software that applies the increment, overtime and deduction limits the same way every month.
• Regular audits: check a sample of payslips against this checklist at least once a year and after every council decision.
• Employee communication: explain how pay, overtime, deductions and leave are calculated; the pay statement each worker receives is the place to start.

Fines for Payroll Breaches

Fines are counted for each worker affected and doubled for a repeat offence. The person who actually manages the company faces the same penalty if they knew of the breach and their failure contributed to it (Article 298).

Ministry of Labour inspectors check that decisions of the National Council for Wages, including the minimum wage, are applied (Article 105). They can enter workplaces and examine books and records (Article 276), and workers take wage, leave and dismissal claims to the labour courts.

This guide summarises Egypt's Labour Law No. 14 of 2025, as published in the Official Gazette (Issue 18, continued) on 3 May 2025, for general information. It is not legal advice.

FAQs About Payroll Compliance in Egypt

Does Labour Law No. 14 of 2025 apply to my company?

Yes, if you employ workers in Egypt. It excludes only employees of state bodies, local administration units and public authorities, and domestic workers (issuing Article 1). Better terms that your workers already have under their contracts or company rules continue to apply (Article 6).

Is the 3% increment calculated on the basic or the gross salary?

On neither. It is at least 3% of the insurance wage, the wage on which social insurance contributions are paid (Article 12). In 2026 that wage runs from 2,700 to 16,700 EGP a month, so 3% of it is at most 501 EGP, subject to the National Council for Wages' 250 EGP floor.

Can an employer still dismiss a worker directly?

Not as a disciplinary penalty: dismissal for misconduct is now for the labour court, and only for grave misconduct the law lists (Article 148). You can end an open-ended contract with three months' written notice for a legitimate reason; without one, you owe at least two months' wage per year of service (Articles 156, 157 and 165).

Is a final settlement signed by the worker binding?

Not where it gives up rights under the law and was signed during employment or within three months after it ended: such a release is void (Article 6). Pay all dues within 7 days of the worker's request (Article 108).