Egypt’s Labour Law Reform 2025: A Legal Reset for the Workforce

Amr Ali
May 6
5 min read

Updated: May 6

After nearly two decades of application, Egypt’s Labour Law No. 12 of 2003 ("Old Law") has been replaced by the newly enacted Labour Law No. 14 of 2025 ("New Law"). This reform is not merely administrative—it marks a legislative overhaul that recalibrates the employment relationship to reflect today’s socioeconomic realities. From redefining contract structures to formalising flexible work arrangements and introducing stronger parental protections, the New Law offers both legal clarity and practical enforceability.

In this article, we outline the critical legal developments under the New Law, assess their implications for employers and employees, and support our analysis with citations to the relevant articles.

Scope of Application: Who Is Now Covered?

A notable innovation under the New Law is its express inclusion of modern employment formats. Article 96 formally recognises arrangements such as part-time work, remote employment, flexible hours, job-sharing roles, and dual-employment structures. Unlike the Old Law, which failed to regulate such evolving labour forms, the New Law imposes specific obligations on employers to ensure that these contracts are documented—either in written or digital form—and that all relevant social insurance and labour protections are preserved. This legislative development responds to Egypt’s growing digital and service economies, promoting both labour market flexibility and regulatory oversight.

In addition to traditional full-time private sector employees, the New Law now explicitly covers:

Remote workers who perform tasks offsite, including from home or alternative locations.
Part-time workers who are employed for reduced daily or weekly hours.
Employees working flexible or split shifts, enabling variable daily work structures.
Workers engaged in job-sharing models, where responsibilities are distributed across multiple individuals.
Freelancers with contractual obligations to specific employers, so long as there is no conflict of interest.
Employees working simultaneously for multiple employers, with confidentiality and non-competition rules respected.

This broadened scope ensures legal protection and equal access to benefits for Egypt’s increasingly diverse workforce.

Employment Contracts: Structural Revisions

The New Law introduces clarity and structure to both fixed-term and open-ended employment contracts. Article 155 stipulates that fixed-term contracts, even when renewed, may not exceed a cumulative period of four years. Beyond this threshold, the law mandates the conversion of the relationship into an indefinite-term employment contract. This limitation aims to curb the common abuse of perpetual renewals that denied workers long-term security under the Old Law.

Should an employer terminate a fixed-term contract prematurely, Article 155 paragraph 2 provides that the employee is entitled to compensation equal to one month’s wage for each year of service. This provision represents a significant enhancement to worker protections by attaching a measurable cost to arbitrary dismissal.

Open-ended contracts are also governed by a unified notice requirement. Under Article 157, termination by either party necessitates a three-month notice period, thereby replacing the Old Law’s variable formula, which linked notice length to seniority. The new rule offers greater predictability for workforce planning and legal consistency.

Leave Entitlements: Codified Improvements

The New Law brings a comprehensive overhaul to the statutory leave framework:

Maternity Leave (Article 54): Increased from 90 days to 120 days and now available after six months of continuous service. It may be claimed up to three times during employment. Employers are prohibited from assigning overtime work or terminating pregnant workers during the leave period. Reduced working hours are also mandated from the sixth month of pregnancy (Article 55).
Paternity Leave (Article 56): Introduced for the first time. Fathers are entitled to one fully paid day off on the day of childbirth, up to three times per employment relationship.
Childcare Leave (Article 58): Female employees may take three unpaid leaves to care for a child, each spaced at least two years apart. Eligibility requires at least one year of service.
Sick Leave (Article 108): Employees are entitled to 12 months of leave every three years of service. The pay structure is: 100% of wages for the first three months, 85% for the next six months, and 75% for the final three months.

Compared to the Old Law—which offered less duration and lower compensation—these provisions significantly enhance employees’ rights to paid and unpaid leave across a range of life events.

Workplace Protections & Disciplinary Actions

Article 115 permits employers to conduct medical tests on employees for drug use or infectious diseases, provided that such tests remain confidential and that results are disclosed only with employee consent or by court order. The inclusion of this provision reflects an effort to safeguard workplace safety while respecting privacy and human dignity.

In terms of disciplinary measures, Article 168 significantly redefines the legal treatment of absenteeism. Where the Old Law allowed for dismissal based on extended unauthorized absences, the New Law now treats such instances as a de facto resignation. An employee who is absent for either ten consecutive days or twenty non-consecutive days without justification will be considered to have resigned—but only after receiving a formal warning issued via registered mail. This procedural requirement serves to protect employees from unjust and sudden dismissals.

Labour Disputes & Institutional Mechanisms

To enhance the efficiency of employment litigation, Article 143 establishes a specialised labour judiciary. Labour courts are required to issue decisions on dismissal-related cases within three months from the first hearing. This is a clear improvement over the Old Law’s reliance on general civil courts, which lacked the procedural speed or sectoral expertise.

Article 151 creates a dedicated Mediation and Arbitration Centre, allowing for alternative dispute resolution pathways in both individual and collective conflicts. This mechanism aligns with international labour standards and supports faster, less adversarial resolutions.

Article 122 also grants employers the authority to suspend workers during internal investigations for up to 60 days with full pay. However, suspended employees may appeal the measure within three days to a judge of urgent matters. If the employer seeks to extend the suspension beyond the 60-day period, they must obtain court approval. In the interim, wages may be reduced to half. These provisions balance the employer’s right to investigate misconduct with the employee’s right to procedural fairness.

Wage Payments & Modernisation

A forward-looking element of the New Law is found in Article 104, which now authorises employers to disburse wages via bank transfers. This supplements the traditional cash payment method and aims to promote transparency, reduce payroll fraud, and support digital banking infrastructure.

Conclusion

The New Law introduces a comprehensive restructuring of the employment relationship in Egypt. It integrates international labour standards, enhances procedural clarity, and provides tangible protections across diverse working arrangements. For employers, it presents both a challenge and an opportunity to modernise internal policies and ensure compliance.

At Nour, Ali & Partners, we are committed to assisting clients through this transition with pragmatic legal advice, compliance audits, and tailored policy development.