Tax and Compliance — 5 min
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Over the past few years we’ve seen a rapid shift in the way businesses operate, with many companies opting to hire remote workers in their own country or abroad. Hiring remote workers is more cost effective and allows businesses to choose from a wide selection of top talent. Companies open to employing in Egypt will find a large and diverse pool of professionals in fields across tech, customer support, marketing, sales, human resources, and more.
Remember — if you are hiring global employees, you must always stay compliant with local labor laws. One way of doing this is to launch a business entity in Egypt and work with local legal experts to ensure that your company effectively pays its employees, provides benefits, and stays on top of any changes in legislation. The costs, complexities, and time involved with this approach are immense.
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There's a much easier alternative: you can use an employer of record, or EOR, to take care of all of that for you, keeping your company compliant while saving you time and money.
Below, you’ll learn how to hire and pay workers in Egypt and attract the best local talent, all while offering the right benefits and staying fully compliant with labor laws in both Egypt and your own country.
Who is entitled to benefits in Egypt?
In Egypt, all employees who have worked for their employer for more than six continuous months are entitled to benefits, including social security, health insurance, paid time off, sick leave, and maternity leave. While full-time, part-time, and temporary employees in Egypt are entitled to benefits, independent contractors are not.
Labor protections in Egypt
Before hiring workers in Egypt, your company must be familiar with local labor laws to ensure full compliance and avoid potential penalties and fines.
The Egyptian Labor Law of 2003 guarantees strong labor protections, including:
Mandated raises of a minimum of 7% per year
Equal opportunity protections
Prohibition on hiring discrimination based on sex, origin, language, religion, or creed
A minimum wage, even for workers on commission or output
The right to 21 days of vacation per year for every worker
A maximum workday of 8 hours and a maximum work week of 48 hours
A one-hour break if a workday lasts for five hours or more
Compensation if an employee is terminated without legitimate and adequate justification
Also, employees or employers can terminate an open-ended contract, as long as two months' notice is given (if the employee has worked at the company for 10 years), or three months' notice (if they've worked longer than 10 years). Employees cannot be terminated unless they commit a serious offense
Hiring
When hiring, employers are allowed by law to ask for certain information about job candidates, such as their full names and home addresses. Employees are protected from discrimination based on age, religion, gender expression, and race. When an employee is hired, the company must provide a copy of the employment contract written in Arabic.
Using an employer of record (EOR) is an easy way to ensure that you are compliant with the many laws and regulations in place in Egypt.
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Statutory and common Egypt benefits
Egypt's labor laws mandate that full-time employees receive the following benefits:
Minimum wage and overtime
Leave allowances
Health insurance and social security
Maternity leave
Disability insurance
Unemployment compensation
Termination rules
These are benefits that companies are required to offer their workers by law. However, providing optional benefits and perks — like wellness programs — is a good way for your company to attract qualified and talented employees and encourage a healthier and more productive work environment.
Minimum wage and overtime
Employees must be paid a minimum wage of 2,700 EGP per month for work in the public sector, and 2,400 EGP in the private sector. EGP refers to the Egyptian Pound, but you may also see it notated as LE, which stands for Livre Égyptienne.
In Egypt, workdays can be up to 8 hours long. Work weeks must be no more than 48 hours. If employees work over these hours, they must be paid overtime of an additional 35% during daytime hours and 70% for nighttime hours. Payroll must be paid monthly by the 5th calendar day for the previous month’s work.
Minimum leave allowances
Employees who have worked at a company for at least six months consecutively earn an annual leave of a minimum of 21 days. Employees who have worked at a company for at least 10 consecutive years, or who are 50 years old or older, get a minimum of 30 days annual leave.
Employees are also entitled to paid days off on Egypt's public holidays. If an employee must work on one of the public holidays, they are entitled to three times their normal pay. Since 2020, most holidays are observed on a Thursday. These include:
Coptic Christmas
Revolution Day
Coptic Easter
Sham el Nessim
Sinai Liberation
Labor Day
Eid Al Fitr, observed for three days
Eid Al Adha, observed for four days
Revolution Day
Islamic New Year
Armed Forces Day
Muhammad’s Birthday
The dates of some Islamic holidays are subject to change depending on moon sightings.
Other leave allowances include:
Sick leave: This is provided at 75% of an employee's salary for 90 days, and 85% for longer periods up to 180 days.
Study leave: Arrangements made during collective bargaining are required to be honored.
Pilgrimage leave: If an employee has worked for at least five years with a company, they may get a paid month off for a pilgrimage (a religious journey or a journey to a sacred place).
Casual leave: An employee is allowed up to six days of casual leave per year, two days at a time. This is subtracted from the total annual leave entitlement. Casual leave is typically used for personal or family reasons.
Health insurance and social security
Private companies in Egypt are required to provide healthcare for employees and pay for social insurance, which covers:
Old age
Illness
Death
Disability
Unemployment
Employers and employees must both pay into social insurance. Using an EOR such as Remote can ensure both parties’ contributions are paid on time and correctly.
Maternity leave and nursing breaks
Maternity leave is 75% of an employee's most recent wage. Female employees can get maternity leave of three paid months per baby for up to three children, as long as they have paid into social insurance for the prior 10 months.
Women can get one 60-minute or two 30-minute nursing breaks per day, for up to 24 months after having a baby. Women who have had a baby reserve their full benefits when they return to work.
There is no paternity leave under Egyptian law.
Employees who adopt children are entitled to 15 days of paid leave from the day they receive legal custody of the child.
Injury and disability
Employees who pay into social insurance are eligible for injury benefits. These amount to 100% of their wage until the employee returns or is considered permanently disabled, after which they are entitled to 80% of their monthly salary (capped at 875 EGP) based on their salary the year before the injury.
Unemployment
Unemployment benefits are available for employees who have paid at least six months of contributions, provided they:
Did not leave voluntarily
Were dismissed for misconduct
Did not refuse a suitable job offer
The employer must pay 1% toward unemployment insurance.
Termination rules
Employers can only terminate employees for breach of contract. If an employee is dismissed without cause, they are due two months' salary for each year of service with the company. Severance pay is not required by law. It is required for employers to give notice of termination two months in advance for employees of less than 10 years tenure with the company, and three months in advance for employees that have been with the company for over 10 years. Probation periods can be no longer than three months.
Want to see a full breakdown of employment costs for new hires in Egypt? Check out our free Employee Cost Calculator tool.
Supplemental benefits to attract top talent in Egypt
There are many supplemental benefits to consider for employees in Egypt if you want to attract and retain highly skilled employees.
Home office supplies or stipends
Your company saves money by having remote employees with their own home offices. You could use some of those savings to provide a great working experience for your remote workers by giving them the necessary tools to do a great job. These tools could include computers, laptops, tablets, phones, desks, ergonomic office chairs, or any other supplies that could improve their work-at-home experience.
You could also offer employees an annual or one-time stipend to use on home office supplies. At Remote, for instance, we offer all internal employees a stipend of $500 USD.
Flexible scheduling
Along with having the freedom to work wherever they want, remote workers also value having the freedom to work when they want. By allowing employees to choose which hours they work, you are setting them up for success — particularly if you’re leading a team across multiple time zones
Bonuses
Paying bonuses is common in Egypt and most employees expect to be rewarded for exemplary work. It’s an important benefit to consider if you want to be competitive in the Egyptian talent market.
Paid time off policies
In addition to the required holidays and off days, you can offer your team members more paid time off (PTO) to give them time to rest and relax so that they can return to work refreshed. Advertising that you provide more weeks of paid vacation time than your competitors will likely attract more top talent to your organization.
Health and wellness
The healthier your employees, the happier and more productive they can be. When your team members are healthy, they're less likely to take time off for illnesses or injuries. Providing gym memberships or even reimbursements for healthy food can go a long way in keeping your remote workforce healthy. Providing mental health counseling and therapy is another good benefit to keep your team's morale high.
Download your Global Benefits Guide and attract top global talent
Remote's global HR experts share practical advice for building a locally relevant and globally compliant benefits program to help you attract and keep the world's best talent.
How to set up and manage benefits for international employees
When paying remote employees, be sure to deduct the appropriate percentage for each of the employer deductions, such as income tax withheld, and both employee and employer payments into social insurance. You must provide payslips and keep records of all hours worked and wages paid. In addition to payroll, your company must obey certain labor laws in both your home country and any remote employee’s country, including Egypt.
Or, instead of setting up HR teams and legal consultants in every country where you employ remote workers, our global remote employment and payroll solution can take care of payroll, taxes, and benefits for you, ensuring that your company is always compliant — without the stress.
As an employer of record (EOR), we can:
Manage payroll and paid time off
Pay employment taxes and deduct income taxes
Offer competitive compensation packages, including benefits
Onboard new team members and scale your team
How to stay compliant and pay on time
Making sure your employees are paid on time and provided with benefits — both statutory and supplementary — can be tricky, especially when you're working with employees around the world.
When hiring a remote employee in another country, you must make sure that you’re staying fully compliant with that country’s labor laws, including important regulations around employee benefits. It pays to constantly keep on top of all labor laws, which are always subject to change.
To make sure your company stays compliant, consider using an employer of record (EOR) to handle all of the complexities of international remote hiring, including on-boarding new remote team members, managing payroll, and paying all benefits. Visit Remote to learn more about working with an EOR in countries like Egypt and beyond, so that you can pay employees fast and reliably and always remain in compliance.
Hire and pay your global team with speed and security
Start using Remote’s employer of record services and local entities to avoid the time, cost, and risk of building your own.
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