Global Compliance- Egypt

Egypt: Introduction of New Labour Law  

The Egyptian Parliament has recently enacted Labour Law No. 14 of 2025 (“the Act”), which repeals and replaces the existing Labour Law No. 12 of 2003 in its entirety. The Act is scheduled to come into force on September 1, 2025, introducing significant changes to various aspects of employment regulation, including employment contracts, working hours, leave entitlements, and termination procedures etc. 

The key changes introduced by the New Labour Law include the following: 

Working Hours 

Currently, when an employee is required to meet unusual work demands or exceptional circumstances, the employer is obligated to inform the competent administrative authorities and obtain approval  for such additional work in advance, or prior to the additional work actually occurring. 

In all such cases, the employee’s actual working hours must not exceed ten hours per day. 

Effective September 1, 2025, employers are no longer required to obtain prior approval. Instead, they must notify the relevant authorities within 7 days of the additional work being done, stating the reason and the duration for additional work. 

In all cases, the employee’s hours of presence in the facility may not exceed twelve hours. 

Public Holiday 

Currently, an employee is entitled to 13 days of paid public holiday. An employee who works on public holidays is entitled to receive double their regular rate of pay. 

Effective September 1, 2025, the statutory cap on the number of public holidays will be eliminated. Employees will be entitled to paid leave on official holidays, festivals, and special occasions, as prescribed by a decision of the competent minister. 

In the case of non-Muslim employees, entitlements to religious holidays shall be governed by the Cabinet decision issued for this purpose. 

Pay – If an employee works on a public holiday they will be entitled to receive double their regular rate of pay. 

Compensatory Rest Period – Instead of premium pay, and upon the employee’s written request, the employee shall be entitled to a compensatory rest day in lieu of the public holiday worked. 

Annual Leave Entitlement 

Currently, employees who have completed one year of continuous service are entitled to 21 working days of paid annual leave per calendar year. Where an employee has completed at least six months but less than one year of service, annual leave shall be granted on a pro rata basis. Also, the employee is entitled to receive 30 working days of paid annual leave when the employee has completed 10 years of service or when they have completed 50 years of age. 

 Effective September 1, 2025, the revised entitlement for annual leave as follows: 

• First-Year Entitlement: Employees are entitled to 15 working days of paid annual leave during their first year of service.  
• From the Second Year Onwards: Annual leave entitlement increases to 21 working days per year. 
• Long-Term Service or Age-Based Entitlement: Employees are entitled to 30 working days of paid annual leave once they have either:
  • Completed 10 years of service, or 
  • Reached the age of 50 years.
• Extended Leave for Persons with Disabilities and Dwarfism: Employees with disabilities or dwarfism are entitled to an extended annual leave of 45 working days, irrespective of their length of service. 

Kindly note: the remaining provisions relating to annual leave remain unchanged and shall continue to be applied in the same manner. 

Sick Leave 

Currently, employers are obligated to grant sick leave to employees whose illness has been certified by the relevant medical authority. Employees are entitled to receive sick leave benefits within each three-year period of service as follows: 

• 100% of their regular rate of pay for the first month,  
• 75% of their regular rate of pay during the following eight months; and 
• Unpaid leave for the subsequent three months. 

Effective September 1, 2025, employees are entitled to receive increased sick leave pay benefits. The amount of benefit has increased as follows:  

• 100% of their regular rate of pay for the first three months,  
• 85% of their regular rate of pay for the following six months, and  
• 75% of their regular rate of pay for the last three months. 

In addition, the law introduces a new health protection measure whereby the competent medical authority may issue a restriction preventing an employee from working for a period not exceeding three months if the employee has been in close contact with a family member diagnosed with a contagious disease. 

Kindly note: the remaining provisions relating to sick leave remain unchanged and shall continue to be applied in the same manner. 

Maternity Leave  

Currently, female employees who have spent 10 months or more with the same employer are entitled to receive 3 months of paid maternity leave. This leave can be availed twice during the employee’s period of service. 

Effective September 1, 2025, the existing requirement for a female employee to have completed ten months of service with the employer to qualify for maternity leave will be repealed. 

A female employee will be entitled to receive 4 months of paid maternity leave, regardless of the years of services with the employer. A female employee will be able to avail the leave for three times during their employment. 

Additionally, pregnant female employees will be entitled to a reduction of no less than one hour in their daily working hours starting from the sixth month of pregnancy. Furthermore, they will be prohibited from performing overtime work throughout the duration of pregnancy and for a period of six months following childbirth. 

Kindly note: the remaining provisions relating to maternity leave remain unchanged and shall continue to be applied in the same manner. 

Emergency Leave 

Currently, there is no provision for emergency paid leave on childbirth in the current labour law. 

Effective September 1, 2025, an employee whose child is born will be entitled one working day of paid emergency leave upon the birth of their child. This leave can be taken up to a maximum of three times throughout their period of service. 

Currently, an employee may be absent from work for an unforeseen reason for a period not exceeding six days per year, and a maximum of two days at a time. The unforeseen leave shall be deducted from the employee’s annual leave. 

Effective September 1, 2025, an employee can be absent from work for an unforeseen reason for a period not exceeding seven days per year, and for a maximum of two days at a time. The unforeseen leave shall be deducted from the employee’s annual leave. 

Childcare Leave 

Currently, a female employee shall have the right to obtain leave without pay for a period of up to 2 years to take care of their child. This leave can be given two times during the employee’s period of service. 

Effective September 1, 2025, an eligible female employees will be entitled to receive childcare leave up to three times during their employment. An employee shall have completed at least one year of continuous service with the same employer to be eligible for childcare leave. Additionally, there must be at least a two-year interval between the first and second childcare leave periods. 

Kindly note: the remaining provisions relating to childcare leave remain unchanged and shall continue to be applied in the same manner. 

Exam Leave  

Currently, an employee enrolled in any stage of education may schedule annual leave for exam dates, provided they notify the employer at least 15 days in advance. 

Effective September 1, 2025, in addition to the above entitlement, an employee will be entitled to receive paid study leave for the actual exam days. This leave shall be separate from annual leave and shall not be deducted from the employee’s annual leave entitlement. The employee must notify the employer at least ten days in advance and provide documentation confirming attendance at the examination to receive this benefit. 

Recording Requirements 

Currently, employers are required to maintain and record the employee’s documents for a period of one year.  

Effective September 1, 2025, the employer will be required to record and maintain employees’ documents for a period of five years from the date of termination. 

Modern Work Models 

Currently, there are no provisions for flexible work models in the labor law.  

Effective September 1, 2025, the New Labour Law formally acknowledges remote work, flexible work, part-time work, and job-sharing arrangements. These are defined as follows: 

• Remote Work: A work arrangement where tasks are performed outside the employer’s usual workplace, usually through technology. 
• Part-Time Work: A schedule in which an employee works fewer hours than those required for a comparable full-time position. 
• Flexible Work: A setup that allows employees to work their required hours with flexibility at varying times, durations, or locations, as mutually agreed upon. 
• Job Sharing: An arrangement where two or more employees share the duties and hours of a single position, with proportionate compensation. 

End of Service Bonus for Fixed-Term Employment Contracts 

Currently, there are no provisions for end of service bonuses while terminating fixed-term employment contracts exceeding five years in the labor law. 

Effective September 1, 2025, if an employer terminates a fixed-term employment contract longer than five years prior to their expiration date, the employee shall be entitled to receive one month’s pay for every year of their service.  

Take Away- Employers shall proactively review and update their policies in preparation for these forthcoming labor law reforms.