Egypt's New Labour Law 14/2025: What Your HR System Must Change

Egypt's Labour Law No. 14 of 2025 replaced Law 12/2003 and has applied since 1 September 2025. For your HR system, the main changes are: an annual increment of at least 3% of the insured salary, new leave entitlements (including four months' paid maternity leave and new paternity leave), written contracts in Arabic in four copies, a three-month resignation notice, recognition of remote, part-time and flexible work, annual employee data submissions in January, and keeping records for five years after an employee leaves.

Many Egyptian companies still manage HR in Excel or in older payroll programs designed around the previous law. Leave balances are calculated by hand, contract templates are outdated, and nobody tracks when the annual increment is due for each employee.

This guide summarises the main changes as reported by EY and translates each one into what your HR and payroll software must do. Always confirm details with your lawyer or HR adviser.

Key takeaways

• Law 14/2025 was enacted on 3 May 2025 and applies from 1 September 2025.
• Payroll must support an annual increment of at least 3% of the insured salary, with possible exemptions for eligible employers.
• Leave rules must be updated: annual leave by tenure, longer maternity leave, paternity leave, childcare and exam leave.
• Contracts must be written in Arabic in four copies; the system should generate and track them.
• Records must be kept for five years after termination, and employee data must be submitted every January.

The main changes at a glance

The table below summarises changes reported by EY (2025), with the system implication of each.

Area	What the law says (per EY)	What your HR system must do
Annual increment	At least 3% of the social insured salary each year; temporary exemptions possible	Calculate and schedule the increment per employee; record exemptions
Annual leave	15 working days in the first year, rising with service; 30 days after 10 years; 45 days for employees with disabilities	Tenure-based leave accrual rules
Maternity leave	Four months paid, up to three times during employment, no minimum service	New leave type, entitlement counter
Paternity leave	Leave on the day of the child's birth, up to three times, not deducted from annual leave	New leave type with limit
Childcare leave	Unpaid up to two years, up to three times, in establishments with 50+ employees and after one year of service	Eligibility checks, unpaid leave handling
Contracts	Written in Arabic in four copies	Arabic contract templates, copy tracking
Resignation	Three months' notice; employer responds within 10 days	Notice period workflow and deadlines
Work patterns	Remote, part-time, flexible work and job sharing recognised	Contract types, schedules, attendance rules
Training fund	0.25% of the minimum insured salary per employee	Automatic contribution calculation
Records and reporting	Employee data statement, updated every January; records kept five years after termination	Annual report generation, retention rules

Payroll: the annual increment and contributions

The 3% minimum annual increment

EY reports that employers must grant an annual increment of at least 3% of the social insured salary, with temporary exemptions available for eligible employers. Your payroll system should:

• Store each employee's insured salary separately from gross pay.
• Calculate the minimum increment and flag employees whose increase would fall below it.
• Record the effective date and any approved exemption with supporting documents.
• Keep a history of every salary change with who approved it.

Social insurance limits change every January

Under Social Insurance Law 148/2019, the employer contributes 18.75% and the employee 11% of the insured salary. For 2026 the insured salary has a minimum of EGP 2,700 and a maximum of EGP 16,700, from 1 January 2026, and the limits rise every January (PwC Tax Summaries; Mercans, 2025). PwC also lists a Martyrs Fund deduction of 0.05% of gross pay. These values must be parameters in the system, not hard-coded formulas, so the January update is a settings change rather than a programming job.

Training fund contribution

The contribution changed from a share of net profits under the old law to 0.25% of the minimum insured salary per employee, according to EY. The system should compute it automatically from headcount and the current minimum insured salary.

Salary income tax

Payroll tax follows the Income Tax Law, with a personal exemption and progressive brackets summarised by PwC. Brackets and exemptions change by law, and the treatment of higher incomes should be confirmed with a tax adviser before you configure a calculator. Keep brackets as configurable tables with effective dates.

Leave management: new types and new rules

Leave is where old systems break first. Configure:

• Annual leave accrual by tenure, with the higher entitlement after 10 years and 45 days for employees with disabilities.
• Maternity leave of four months paid, with a counter of how many times it has been used.
• Paternity leave on the day of birth, limited to three times and separate from annual leave.
• Childcare leave (unpaid) with eligibility rules based on company size and service.
• Exam leave for actual exam days with advance notice and proof of attendance.
• Approval workflows and automatic balance updates visible to employees on their phones.

Contracts and new work patterns

Arabic contracts in four copies

Per EY, contracts must be in writing, in Arabic, in four copies: for the employer, the employee, the social insurance office and the competent administrative authority. For non-Arabic-speaking foreign employees, the contract is in Arabic plus the employee's language. Your HR system should generate contracts from approved Arabic templates, store signed copies, and track where each copy was delivered.

Remote, part-time and flexible work

The recognition of remote work, part-time work, flexible arrangements and job sharing means the system must support different contract types and schedules. For a software company in Maadi with remote developers or a call centre in Nasr City with part-time shifts, attendance cannot rely only on a fingerprint device at the door. Consider mobile check-in, task-based attendance for remote staff, and schedules per contract type.

Resignation and notice periods

The resignation notice rose to three months, and EY notes the employer must respond within 10 days. Build a workflow: resignation received, response deadline, notice end date, handover checklist, final settlement.

Records, reporting and employee data protection

Five-year retention

Records must be kept for five years after termination, according to EY. The system should archive leavers' files rather than delete them, with a review date five years after the termination date.

January employee data submission

Employers must submit a statement of employee data and update it every January. A good HR system produces this from its records, so it becomes a report rather than a week of manual work.

Employee data is personal data

Employee records include national IDs, salaries, bank details and sometimes medical certificates. Egypt's Data Protection Law 151/2020 applies, with executive regulations whose compliance period ends on 1 November 2026 (CMS, 2026). Restrict salary and medical data to authorised HR roles, log access, and include employees in your privacy notices.

HR system checklist for Law 14/2025

1. Insured salary stored separately; annual increment calculated and scheduled.
2. Social insurance limits, rates and deductions stored as yearly parameters.
3. Training fund contribution calculated automatically.
4. Leave types and accrual rules updated for tenure, maternity, paternity, childcare and exams.
5. Arabic contract templates with four-copy tracking.
6. Contract types for remote, part-time, flexible and job-sharing arrangements.
7. Resignation workflow with three-month notice and 10-day response deadline.
8. January employee data report.
9. Five-year retention for leavers' records.
10. Role-based access and audit logs for salary and personal data.

How Nilex helps

Nilex builds HR and payroll modules inside a custom ERP system: employee files, Arabic contract generation, leave rules, insured salary and increments, yearly parameters for insurance and tax, attendance for office and remote staff, and role-based access with a full audit log, on a PostgreSQL database. Because rates change every January, we design them as settings your HR team can update. For companies with several branches, the Growth ERP package covers multi-branch operations.

Frequently asked questions

When did Egypt's new labour law take effect?

Law 14/2025 was enacted on 3 May 2025 and applies from 1 September 2025, replacing Law 12/2003, according to EY.

Is the 3% annual increment calculated on gross or insured salary?

EY describes it as at least 3% of the social insured salary, with temporary exemptions available for eligible employers. Confirm how it applies to your pay structure with your adviser.

How many annual leave days do employees get under the new law?

EY reports 15 working days in the first year, 30 days after 10 years of service, and 45 days for employees with disabilities, with entitlement increasing with service in between. Configure your system with the exact rules confirmed by your HR adviser.

How long is maternity leave now?

Four months paid, up to three times during employment, with no minimum service requirement, according to EY. Your system needs a separate leave type and a usage counter.

Can we keep managing HR in Excel?

A very small team can, but tenure-based leave, yearly insurance limits, increment tracking, contract copies and five-year retention quickly become error-prone. An HR system turns these rules into automatic calculations and reports.

If your HR system still follows the old law, now is the time to update it. Book a free consultation with Nilex to review your HR and payroll processes against Law 14/2025.

This article is general information, not legal or tax advice. Confirm the details that apply to your company with a specialist.