Known throughout the world for its rich history, Egypt is also full of potential business opportunities. With a USD 303 billion-GDP that keeps growing, it also boasts a labour market of more than 24 million potential employees. And the best is yet to come: Egyptian universities reached record enrolment rates for years 2019 and 2020, thanks to affordable tuition fees that attract students from various countries such as Malaysia, Indonesia and Nigeria.
This bright financial future coupled with an educated, emerging workforce, is a recipe for success if you plan on expanding to Egypt. You might, therefore, wonder: how do I tap into this strong potential? The key is to master the local labour landscape, its laws and regulations. Here are the most important things you need to know before expanding to Egypt:
In order to protect employees, probation periods, by law, are allowed for any time frame under 3 months. Past this duration, a probation period cannot be extended.
The same applies to fixed-term contracts, which are allowed for a maximum period of 5 years.
Should the employee still hold the same position after that period, the renewal of the agreement (then becoming an indefinite-term contract) would be automatic.
It is also important to note that, in Egypt, an employment contract’s validity is subject to a number of criteria, namely (among others):
In Egypt, the act of dismissing an employee cannot be taken lightly. Indeed, any dismissal must be justified by valid reasons, and prior notice must always be given to the employee. Those having under 10 years of service are entitled to 2 months’ notice, whereas those having over 10 years of service are entitled to 3 months’ notice. Even in case of a grave fault, the employee must be given a fair investigation, a right to make representations, and a notice of termination.
Wrongful terminations can cost employers a compensation of two months’ wages per year of service as a penalty.
The statutory maximum working time is 48 hours per week for a 6-day week. Any additional hours should be compensated by overtime pay.
Approximately 90% of the Egyptian population is of Muslim faith. Key elements of this religion are therefore adopted, both as a matter of law and as a matter of practice, into the work culture. The law requires employers to give any employee with over 5 consecutive years’ service additional paid leave for a period of one month for a pilgrimage. The practice also accommodates religious requirements by allowing employees time to attend prayer on Fridays. Ramadan is also a very important time, during which many offices choose to have shorter hours to free employees for prayer.
As fasting is particularly demanding, allowing employees to work shorter hours also shows that the company cares for them, and in practical terms, renders the workday, albeit shorter, more productive.
Apart from 12 public holidays per year, workers are, by law, entitled to 3 types of paid leave:
In Egypt, employees’ income tax is deducted at source. This implies the need for employers to levy those taxes from the monthly salary and pay them directly to the relevant authorities. Failure to pay those taxes on time will accrue penalties at a minimum rate of 2%. This is why many foreign companies who choose to expand in Egypt often elect to delegate the strategic task of payroll to a specialist.
A citizen’s right to be insured is protected by the Egyptian Constitution. Social security, therefore, provides all employees with insurance coverage for old age, disability, death, sickness, occupational accidents, and pension.
When planning for expansion, the list goes on. You have the option to decide on how to proceed: whether to set up your own legal entity or choose an Employer of Record that will facilitate your implementation and adaptation.
How about insuring non-citizens? Or complying with regulations when working with independent contractors?
Africa HR has helped many companies in their expansion journey across Africa. With experts in domestic law and efficient compliance mechanisms, our teams are here to handle the hassle of onboarding, offboarding, HR, and compliance to let you focus on growing your business.
Grant Geraghty is the longest-serving member of the Africa HR team. This resident subject matter expert and client champion is responsible for gaining a deep understanding of our clients’ unique HR needs in Africa and providing tailored solutions that align with their business objectives. Grant collaborates closely with our clients to ensure that their requirements are properly implemented, providing ongoing support and guidance throughout the process.
Grant brings a wealth of experience to his role, having served as Africa HR’s longest-serving employee. He holds a Bachelor of Commerce degree, with a major in Economics and Business Finance, from the University of Natal in South Africa. Additionally, he has completed a certification program in Payroll and Tax Administration from the University of Cape Town, further enhancing his expertise in HR operations and compliance.
His commitment to delivering exceptional service and his extensive knowledge of HR in Africa make him an invaluable member of the Africa HR team.
Kevina Takoordyal has a BA Hons Business Management from the University of Glamorgan, UK, with MBA in leadership and Innovation, MBA General, PMP Certified, and Agile Scrum Master. She currently works as the Head of Operations at Africa HR Solutions Ltd with more than 20 years of proven leadership capabilities in Operations, Business Development, People Management, Process Optimization, and Project Management in the Financial Services, BPO, Banking Industry, and Heath Care Industry. In Senior leadership roles with an international footprint across Europe working and extensive Pan- African experience from a compliance, finance, and operations angle, Kevina comes across with a panoply of cross-functional skills. Kevina also serves on a few Boards, Non-Independent Executive at MioD and for NGOs on a voluntary basis, a coach and mentor to aspiring female leaders across Africa and Mauritius.
Kevina is a firm believer in Servant Leadership with a strong focus and commitment to uplifting others, with the ability to deliver through a highly engaged – diverse team, and works towards consistently synergistic value creation. While being a focused and adaptive thinker and Kevina is actively participating in panel discussions on Innovation, CX, Digital transformation.
Kevina serves as Project Assessor for the National Youth upskilling program. She has been recognized as Global Talent in a few companies, Ceridian, and International SOS Ltd whereby she has been awarded a few scholarships and had the opportunity to be mentored by Senior Vice President in the US. Award Winner in various fields and at a national level and recognized including Super Achiever Leader Award in Africa in 2016, Awarded Africa Women Leader 2018.
Viloshna is an experienced finance professional with 18 years of expertise in strategic financial planning, financial analysis, cash flow management, systems and controls implementation, financial reporting, and continuous process improvements. She currently serves as Head of Finance & Business Support, where she has successfully automated and leveraged the financial reporting system capabilities to ensure efficient company operations.
Viloshna’s background includes senior roles in a multinational pharmaceutical company and a large listed Mauritian conglomerate. Her meticulous attention to detail and strategic thinking have streamlined financial processes, making her a valuable addition to any finance team. Viloshna is a qualified finance professional with an FCCA qualification and an MBA, bringing valuable expertise to any organization.
In her current role, Viloshna leads the company’s Treasury and Payments function, including the fulfillment of the company’s cross-border payments into Africa. With her strong educational background and extensive experience, Viloshna consistently demonstrates her ability to optimize financial operations, minimize risks, and improve profitability. Her expertise in financial reporting and process improvements make her a valuable asset to any organization.
A qualified lawyer who joined Africa HR Solutions in July 2020, Mark Du Preez has experience working in private practice for a reputable law firm in South Africa. He also played commercially focused roles at a leading private bank, wealth management company, and outsourcing firm in South Africa and Mauritius.
Mark has played a pivotal role in Africa HR Solution’s risk mitigation strategy, which positively impacted P&L performance over the years.
He currently leads the Partnerships function of the company including relationships and oversight with in-country partners (ICPs) across Africa.
Alex has more than 15 years of experience in the global, strategic development of both enterprise and consumer brands in categories including technology, transport, enterprise software, entertainment, and travel.
With experience in roles on both agency and corporate side, he has worked across international brands and has led the development and execution of multi-discipline campaigns across EMEA, NORAM and Asia Pacific.
His focus is on driving meaningful business impact through brand differentiation and building high-functioning, digitally oriented, and analytically driven capabilities. He is motivated by working with, and developing dynamic people, teams, and organizations.
He leads, manages, develops and mentors the Key Account Management department, including line management responsibility for the team of Key Account Managers and Key Account Administrator who represent the Company as the primary communication link between all relevant stakeholders, including clients, third party in-country partners and internal functions.
Originally from Mauritius, he holds bachelor’s degrees in International Business, Finance and Management from the University of Nevada, Reno.