Egypt’s New Labor Law: Business Impact & Compliance Solutions

• Labor Law No. 14 of 2025 became effective on September 1, 2025, replacing all previous labor laws.

• The reform introduces minimum wage rules, enhanced leave entitlements, maternity and paternity benefits, and recognition of new work models.

• Employers now face stricter compliance obligations across payroll, HR administration, resignation validation, and contributions to training and emergency funds.

• Kozman & Co. | SBC Global helps businesses turn these obligations into an opportunity to modernize HR systems and strengthen compliance.

Insights

Published on May 3, 2025, and in force since September 1, 2025, the law represents a major shift in Egypt’s labor framework, aligning it more closely with international labor standards and local workforce needs.

Key updates include:

• Salary Adjustments: Mandatory annual increases of at least 3% of the social insurance wage.

• Modern Employment Models: Recognition of remote, hybrid, flexible, and job-sharing arrangements with equal protection.

• Leave Policies: From 15 days in the first year to 21 days from year two, plus 45 days for employees with special needs. Four months’ maternity leave (up to three times), with new rights to paternity and study leave.

• Resignation Validation: Resignations must be confirmed through the labor office.

• Record Retention: Employee records must be stored for five years post-termination.

Fund Contributions:

• Companies with 30+ employees must contribute 0.25% of the minimum social insurance wage per employee to the Public Training and Rehabilitation Fund.

• Employers of irregular workers must contribute to the Emergency Fund.

These changes directly affect HR practices, payroll systems, and compliance frameworks, demanding expert oversight and adaptation.

How Kozman & Co. | SBC Global Supports Your Business?

• We deliver targeted HR and compliance solutions designed to help employers comply with the new law while enhancing efficiency:

• HR Advisory: Flexible, on-demand expertise in compliance, employee relations, recruitment, and conflict resolution, without long-term commitments.

• Social Insurance Administration: Full management of employee enrollments, contributions, and filings to ensure compliance with labor and health insurance requirements.

• Personnel Administration: Accurate handling of contracts, employee records, and government submissions, reducing the risk of penalties.

• Virtual Assistance: Cost-efficient professional support for admin tasks, translations, and content creation, helping you streamline operations.

• Payroll Calculation: Comprehensive payroll services covering wages, deductions, benefits, and compliance with Egyptian labor laws.

Employer’s Checklist:

✔ Updated payroll to include the mandatory 3% increment?

✔ Leave policies aligned with maternity, paternity, and study leave provisions?

✔ Systems in place for resignation validation and record retention?

✔ Contributions to the training fund and emergency fund accounted for?

✔ HR documentation and contracts updated for modern work models?

If you answered “no” to any of the above, Kozman & Co. | SBC Global can help close the gap quickly and effectively Looking Ahead:

The New Labor Law is more than a compliance update; it is a strategic opportunity to modernize HR operations and build a stronger workplace culture, regulators are expected to step up inspections in the months ahead, businesses that adapt early will not only avoid risks but also position themselves as employers of choice in Egypt’s evolving labor market.