Employer of Record in Ägypten

How an Employer of Record works in Egypt

An Employer of Record (EOR) is a third-party company that acts as a legal business entity (employer) on behalf of another company.

These are mostly used by overseas business owners who want to hire in a new country but don’t yet have a legal entity there.

An EOR provider in Egypt, like Rivermate, will hire employees on your behalf.

It will also take care of the administrative processes, including payroll, tax withholding, social security contributions, other employee benefits and contract terminations.

This expert assistance allows you to enter the Egyptian labor market faster, with less hassle and no risk of breaking local employment laws.

Rivermate’s EOR services are built on three pillars:

• Local HR experts who understand the market and employment laws.
• A network of partners that allows us to provide competitive benefits.
• The Rivermate platform that simplifies every aspect of the employment relationship.

Egypt labor market: At a glance

The hiring market
Greatest hiring activity:	Cairo.
Hiring timelines:	Employees will usually be ready to commence work around seven days after all documents are submitted.
In-demand sectors:	Tech.
Sectors with skills shortages:	Tech, Finance, Renewable Energy.

The salary market
Employer tax contributions:	Employers make social security contributions worth 18.75% of an employee’s “insurable wage”, in most cases. The insurable wage limits increase by 15% every year. In 2026, the maximum limit for an insurable wage is EGP 16,700.
Monthly minimum wage:	EGP 7,000 per month for private sector. EGP 8,000 per month for public sector.
Average gross annual salary:	The latest official figures from 2024 suggest the average annual salary across public and private sectors is EGP 76,032.
Personal income tax rates:	All individuals receive a personal allowance of EGP 20,000, and pay tax on income in excess of EGP 40,000. From there, income is taxed progressively at rates between 10% - 27.5%.

What will it cost to hire in Egypt

Salary requirements

The minimum wage for private sector workers in Egypt is EGP 7,000. In July 2026, the minimum wage for public sector workers increased to EGP 8,000 per month.

Employer contributions

Employers need to make social security contributions based on a percentage of each employee’s “insurable wage”. This rate is 18.75%, in most cases, although the figures do change in some circumstances.

In 2026, the minimum limit for an employee’s insurable wage is EGP 2,700 per month, while the maximum limit is EGP 16,700. These limits increase by 15% every year. So, in 2027, the maximum limit will rise to EGP 19,300.

Employer social security contributions are split into five categories:

• Old-age, disability & death insurance: 12%
• End-of-service benefit: 1%
• Work injury insurance:1.5%
• Sickness insurance: 3.25%
• Unemployment insurance: 1%.

These headline rates may change in some circumstances. For example, work injury insurance can increase to 2% in more dangerous occupations.

Nevertheless, in most cases, an employer contributes 18.75% on insurable salaries up to the maximum limit (which is EGP 16,700 in 2026).

So, as an example, if an employee earns EGP 20,000 per month, their employer would typically contribute: 18.75% x 16,700 = EGP 3,131.25

An EOR with dedicated knowledge of Egyptian tax law will inform you of any appropriate nuances that affect your social security contribution rate.

Statutory benefits

Egyptian employees are entitled to 15 days of paid annual leave in their first year of service, increasing to 21 days in the second year, and 30 days after ten years of service in the Egyptian workforce.

Annual leave is also 30 days for employees over 50, regardless of reaching ten years’ service, and 45 days for employees with disabilities or dwarfism.

They’re given six months of paid sick leave per calendar year if a medical professional deems them unfit to work. The social security system pays this at 75% of an employee’s standard wage for the first 90 days and 85% for the next 90 days. Those with certain chronic illnesses are entitled to 100% of their regular wage. There are different sick pay regulations in certain industrial sectors.

Female workers can take up to four months of paid maternity leave, although only up to three times throughout their career.

Employment Cost Calculator

Use our Employment Cost Calculator to estimate the cost of hiring employees in Egypt.

What it’s really like hiring in Egypt

Market condition	What an employer needs to know
Talent availability	The number of new employees entering the workforce each year is roughly double the number of new jobs being created.
Top-paying sectors	Healthcare, Energy, Tech.
Skills shortages	Tech, Finance, Renewable Energy.
Key employer challenge	The limits on hiring foreign workers.

Egypt has a large, talented workforce, many of whom are multilingual. The hiring process is relatively simple, typically taking around seven days for local employees once all documents are submitted.

Egypt has strict limits on hiring expats

The hiring process takes longer for expats, as documents like work permits and visas often take a while to process. It may be 3-4 weeks before a foreigner is ready to commence work.

That’s assuming a business is permitted to hire foreign workers at all. After all, Egypt employment law states that 90% of an entity’s workforce must be Egyptian nationals in most cases.

Qualifying investment projects can increase foreign employment to 20% where appropriately qualified Egyptian workers are unavailable, with further exceptions for certain strategic projects.

If you’re using an EOR to hire employees in Egypt, it’s the quota of Egyptian nationals working for that EOR that matters.

This strict quota can make it difficult to find an EOR with capacity to hire expats in Egypt.

Compliance risks that employers must know about in Egypt

Employment regulations in Egypt are reasonably straightforward and flexible, particularly compared to most European countries.

Even so, there are a few compliance risks which are important for international employers to understand.

Egyptian employers must keep up with changing tax contributions

The latest rules regarding employer tax contributions in Egypt state that insurable salary limits must increase by 15% every calendar year.

This has been the case since 2021, and it will continue until at least 2027.

It’s the employer’s responsibility to ensure that these contributions remain consistent with these changing limits.

Egyptian employees can only work overtime in exceptional circumstances

In Egypt, the standard working day is eight hours, and the standard workweek is 48 hours. Employees must also be granted at least 24 hours’ rest from working at least once a week.

If an employee works any hours over these limits, they are entitled to overtime pay at the following rates.

• Daytime work: 135% of their regular hourly wage.
• Nighttime work: 170% of their regular hourly wage.
• Work during a rest day: Employees who work on an official public holiday receive their normal day’s pay plus an additional 200%, totaling 300%, or a substitute day off upon their written request..

However, overtime is not designed to be a routine occurrence in Egypt. The national labor code states that it should only occur in exceptional circumstances. Indeed, a business owner must notify its administrative authority whenever overtime is issued to justify the unusual circumstances that required it.

In the case of working on a national holiday, an employee can choose to either earn 200% of their regular hourly wage OR to choose an alternate day off.

In any case, the time an employee spends at the workplace should never exceed 12 hours a day.

Terminating employee contracts isn’t simple in Egypt

An employee must give a legitimate and sufficient reason for terminating an employee contract in Egypt. They must also give three months' written notice and continue to pay their wages during this notice period.

If they prefer, employers can relieve dismissed staff of their duties early, provided they continue to pay them during that notice period.

The exceptions to this rule occur:

• if an employee is dismissed during their probation period;
• if an employee is guilty of gross misconduct.

In both of these cases, they can be dismissed without further compensation. Local courts must make the final decision on all gross-misconduct dismissals.

If an employer fails to provide a legitimate and sufficient reason to terminate an employee’s contract, the employee is entitled to severance pay. This will equal at least two months' wages for each year of service.

There are some circumstances where severance pay would be lower.

• If an employee is made redundant, the severance package would be worth one month’s wages for each of the first five years of service plus one-and-a-half months' wages for each following year.
• If a fixed-term contract is terminated early, the severance package would be equal to one month’s wages for each year of service.

Dismissing employees can be a major headache for business owners at the best of times. These generous notice periods and severance packages in Egypt can make it even more stressful.

On top of this, the legal definitions for “legitimate and sufficient” reasons to terminate contracts are somewhat ambiguous, meaning employees may sometimes feel they have grounds to challenge your decision.

That’s why many international business owners hire a knowledgeable EOR to handle all aspects of employee terminations.

Benefits of hiring employees through an EOR in Egypt

Setting up a legal entity in Egypt is expensive and time-consuming.

Processes like registering an LLC and opening a corporate bank account can be tricky. Finding appropriate support for accounting and payroll is complicated too.

If you’re looking to hire only a handful of employees in Egypt, perhaps just to dip your toes in the market, the effort and expense involved would likely put you off.

An EOR provides a simple and affordable solution. It allows you to enter the Egyptian market quickly while providing all necessary support for payroll, compliance and employee contracts.

At Rivermate, we help employers by:

• providing a local business entity in Egypt.
• handling all administrative aspects of running an Egyptian business, including payroll, taxes, benefits and terminations.
• ensuring they remain compliant with all aspects of Egyptian employment law.

This allows you to focus on doing what you do best: managing your employees and growing your business.

Ready to hire in Egypt?

Hiring in Egypt involves more than finding the best person for the role. From managing payroll, taxes and benefits to ensuring full compliance with local employment law, Rivermate handles all the HR so you can hire with confidence.

Talk to an Egypt Hiring Expert

Sources:

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