In This Guide
How to Hire Employees In Egypt
Hiring in Egypt for the first time can feel complex due to local labor laws, payroll regulations, and the dual-language legal environment. Whether you’re expanding your team, relocating talent, or entering the Egyptian market, it’s important to understand the legal framework and compliance requirements. SOURCEitHR’s Employer of Record (EOR) model can help simplify the process, offering fast and compliant hiring without the need to establish a local legal entity.
Companies can hire employees in Egypt in three main ways:
- Establishing a Local Entity
Companies may set up a branch, subsidiary, or representative office. This approach gives full control but involves legal, financial, and administrative obligations that may not be suitable for short-term hiring or market testing. - Partnering with an Employer of Record (EOR)
An EOR like SOURCEitHR acts as the legal employer on your behalf. It manages employment contracts, payroll, benefits, and compliance, letting you hire quickly without the need for company registration. - Engaging Independent Contractors
While contracting offers flexibility, Egypt has strict rules about employment misclassification. Contractors must operate as genuinely independent to avoid reclassification and legal exposure.
Using an Employer of Record in Egypt
An Employer of Record (EOR) handles the legal, HR, and administrative responsibilities of employing staff in Egypt. This includes:
- Employment Law Compliance
Drafting compliant bilingual (Arabic/English) contracts, ensuring adherence to Egyptian Labor Law No. 12 of 2003. - Payroll Processing
Calculating gross-to-net salaries, handling social insurance contributions, and processing income tax deductions. - Benefits & Leave Administration
Managing mandatory benefits such as health insurance, vacation leave, sick leave, and end-of-service entitlements. - Onboarding & Offboarding
Ensuring employee documents are filed, local registrations are completed, and proper exit protocols are followed.
Good To Know
Labor Laws & Employment Contracts in Egypt
Employment Contract Requirements
- Must be in writing and in Arabic (bilingual contracts are standard).
- Must specify job title, wage, duration (fixed or indefinite), and workplace.
- A copy must be submitted to the Social Insurance Authority.
Probation Period
- Up to 3 months maximum.
- Cannot be extended or repeated..
Working Hours & Overtime
- 8 hours/day or 48 hours/week (including a 1-hour break).
- Friday is the official weekend; some sectors use Friday and Saturday.
- Overtime is paid at:
- 135% of base salary for regular overtime
- 170% for night/weekend work
- 200% on official holidays
Payroll in Egypt
Payroll Cycle
- Salaries are paid monthly, typically at the end of each month.
- Employers must use bank transfers and report payments via the WPS-equivalent local system.
Minimum Wage
- As of 2025:
- Public sector: EGP 6,000/month
- Private sector: EGP 3,500/month (subject to change by the Ministry of Manpower)
Social Insurance Contributions
| Contribution | Employer Rate | Employee Rate |
|---|---|---|
| Social Insurance | 18.75% | 11% |
| Total | 18.75% | 11% |
Income Tax (PAYE Withholding)
Egypt uses a progressive tax system:
| Annual Income (EGP) | Tax Rate |
| Up to 21,000 | 0% |
| 21,001 – 30,000 | 2.50% |
| 30,001 – 45,000 | 10% |
| 45,001 – 60,000 | 15% |
| 60,001 – 200,000 | 20% |
| 200,001 – 400,000 | 22.50% |
| Over 400,000 | 25% |
Statutory Benefits & Leave
Annual Leave
- 21 days of paid leave after one year of service.
- Increases to 30 days after 10 years or for employees over 50 years of age.
Public Holidays
Egypt observes 13–15 public holidays annually (Hijri-based and national), including:
| Holiday | Date |
|---|---|
| Eid Al-Fitr | 3-4 days |
| Eid Al-Adha | 4 Days |
| Revolution Day | 23-Jul |
| National Police Day | 25-Jan |
| Coptic Christmas | 7-Jan |
Sick Leave
- Up to 6 months, starting at 75% of salary for the first month, 85% thereafter.
- Requires certification by a government-approved medical authority.
Maternity Leave
- 90 days of paid leave, at full salary.
- Requires a minimum of 10 months of service.
- Cannot terminate employment during maternity leave.
Paternity Leave
- No statutory paternity leave, but some private companies offer 3–7 days.
End-of-Service & Gratuity
- Employees are entitled to:
- 1 month’s gross salary per year (in some sectors)
- Or end-of-service compensation as per company policy/contract
- Full payment of unused leave days and other accrued entitlements
Termination & Notice Periods
Termination
- Employers must provide a legitimate reason and documentation.
- Termination for cause requires disciplinary investigation.
- Unfair dismissal may result in reinstatement orders or compensation.
Notice Period
- 2 months if employed for <10 years
- 3 months if employed for ≥10 years
Why Use SOURCEitHR as Your EOR in Egypt?
- Fast onboarding in 7–14 days, including work permit processing
- 100% legal compliance with Egyptian labor and tax law
- End-to-end payroll, HR, and benefits management
- Multilingual support (Arabic–English–French)
- Dedicated account manager with local market knowledge
DISCLAIMER
This content is prepared for informational purposes only and is subject to change. It does not constitute legal or tax advice. Please consult a local legal advisor or the SOURCEitHR team before making any employment-related decisions.