Egypt's work and disciplinary regulation: mandatory from ten workers
Does your business in Egypt need a work and penalties regulation? Yes, from ten workers: prepared within 60 days (Labour Law, article 137) and certified under Decree 162 of 2026.
Executive summary
- Every employer with ten or more workers must prepare a regulation of work rules covering violations and disciplinary penalties, within 60 days of starting work, of reaching ten workers, or of the law's entry into force on 1 September 2025 (article 137 of Labour Law 14 of 2025).
- The general rules for the regulation were issued by Minister of Labour Decree 162 of 2026, published in Al-Waqa'i al-Misriya on 13 August 2026 and in force from 14 August 2026.
- The trade union gives its opinion within 15 days, failing which it is deemed to agree; if the labour directorate neither certifies nor objects within 30 days of receipt, the regulation is deemed in force.
- The law sets eight disciplinary penalties (article 139); a deduction may not exceed five days' basic wage for one violation, nor five days' wages in a month (article 143); dismissal is for the labour court (article 148).
- Breaching article 137 is punishable by a fine of EGP 2,000 to 10,000, doubled for a repeat offence (article 283).
Who must have a regulation, and from when
Article 137 of the Labour Law issued by Law 14 of 2025 provides that "every employer who employs ten workers or more shall prepare a regulation of work rules according to the nature of the activity", covering in particular promotion, transfer, wages, violations and disciplinary penalties, "within sixty days of the start of the establishment's work, the date this threshold is reached, or the entry into force of this law, as the case may be". The law was published on 3 May 2025 and applies "from the first day of the month following the lapse of ninety days from the date of its publication" (article 13 of the issuing law). Counted from the day after publication, the ninety days ended on 1 August 2025, so the law applies from 1 September 2025. The text draws no distinction between an establishment that had a regulation under the repealed Law 12 of 2003 and one that had none, while the wages and benefits workers already had under earlier regulations and internal decisions are preserved (article 4 of the issuing law).
It is one document. The law calls it the establishment's "work and penalties regulation" (article 4), and Decree 162 of 2026 lets the establishment place violations and their penalties "in a separate chapter or a table annexed to it" (article 49). It applies to all workers at the establishment, its branches and its work sites, whatever the nature or duration of their employment (article 11 of the decree).
What the regulation must contain
Article 2 of the decree lists fifteen subjects the regulation must cover in particular, spanning employment from job advertising and hiring to its end, including wages, working hours, leave, investigations, and violations and their penalties. The decree also limits what it may say:
- It must include every benefit actually applied before it was prepared (article 3), and applying it may not reduce any right or benefit the workers already had (article 19).
- It must define the acts that amount to harassment, assault, annoyance or bullying, and their penalties, whether committed by superiors, colleagues or subordinates, with a complaints mechanism; the penalty is to be heavier where the offender is the victim's superior (article 16), giving effect to article 4 of the law.
- A probation period may not exceed three months and may not be repeated with the same employer (article 21).
- It may not provide for a notice period on resignation (article 62).
Certification and entry into force
| Step | Time limit | Source |
|---|---|---|
| Application to the competent labour directorate (labour relations office), with three copies of the draft signed and stamped on every page, a copy of the regulation currently in force, proof of the applicant's capacity, and copies of the commercial register, tax card and social insurance number | Official receipt showing the number of pages and the date of submission | Decree, art. 7 |
| Directorate sends a copy to the trade union or the workers' delegate | Three working days at most | Decree, art. 8 |
| Trade union's opinion | 15 days from receipt, failing which it is deemed to agree | Law, art. 137; Decree, art. 8 |
| Establishment addresses the directorate's reasoned objection | Five working days at most | Decree, art. 9 |
| Certification or objection | 30 days from receipt, failing which the regulation is in force from the following day | Law, art. 137; Decree, art. 9 |
| Posting | A visible place at the establishment, its branches and its work sites | Law, art. 137 |
The directorate objects where the draft breaches the law or reduces a benefit found in the establishment's previous regulation or actually granted to workers (article 9 of the decree). The establishment must review its internal regulations periodically, and any amendment is certified by the same procedure as the first certification (articles 64 and 65 of the decree).
Disciplinary penalties and their limits
Article 139 provides that "the disciplinary penalties that may be imposed on a worker under the establishment's work and penalties regulations are":
| Penalty | Limit |
|---|---|
| Written warning | — |
| Deduction from basic wage | Five days' basic wage per violation (article 143) |
| Deferral of the annual increment | Three months |
| Withholding part of the annual increment | Half of it |
| Deferral of a promotion when due | One year |
| Reduction of basic wage | One increment at most |
| Demotion to a post in the grade immediately below | Without reducing pay |
| Dismissal | By judgment of the labour court (article 148) |
The penalties in the regulation are a ceiling: a lesser penalty may be imposed or the investigation closed (article 50 of the decree), and penalties are graduated from warning upwards (article 51 of the decree). Only one penalty may be imposed for one violation (article 140). The other penalties are imposed by the employer or a delegate, and the establishment's manager may impose a warning or a deduction of up to three days; dismissal is for the competent labour court and only for a serious fault (article 148), after lesser penalties have been exhausted where the nature of the violation allows (article 48 of the decree). Ending employment and the dismissal procedure before the court are outside this piece.
The employer keeps a register of financial penalties and holds their proceeds in a separate account to be spent on the establishment's workers for social, cultural and sports purposes; on liquidation the balance is shared equally among the workers then employed (article 153). Breaching this carries the same penalty as breaching article 137 (article 283).
Investigation safeguards
These are set by the law and restated in articles 46 and 47 of the decree:
- The act must be connected with the work (article 138).
- No penalty may be imposed until the worker has been told in writing of the charge, heard and allowed to answer it, in minutes placed on the personnel file. The investigation must start within seven days of the violation's discovery and last no more than three months, extendable by three months if new facts or documents come to light (article 141).
- Where the penalty is a warning or a deduction of no more than one day's basic wage, the investigation may be oral, provided its substance is recorded in the penalty decision; the decision must always state its reasons (article 141).
- The establishment's legal affairs function investigates; failing one, the employer may entrust the investigation to an expert or to an employee, provided the investigator's job level is not below the worker's (article 142).
- No penalty may be imposed more than thirty days after the investigation ends (article 138).
Breaching articles 140 to 145 is punishable by a fine of EGP 1,000 to 20,000, doubled for a repeat offence (article 294).
What this requires
- Count the workers at the establishment and its branches, and fix the date the 60 days ran from. For an establishment that starts with ten or more workers they run from the start of work, alongside opening its social insurance file.
- Review any existing regulation against the decree and remove what conflicts with it, such as a notice period on resignation or a probation longer than three months.
- List the benefits actually applied and include them, since reducing them is a ground for objection.
- Draw up the violations table with a maximum penalty for each, taken from the eight, covering harassment and bullying.
- Keep the directorate's receipt, which proves when the 30 days began, then post the regulation.
- Record penalty proceeds in their own account, apart from the establishment's income, and make no disciplinary deduction in the payroll without a reasoned decision.
The firm's Social Insurance & Labour Department prepares work and penalties regulations, reviews existing ones against Decree 162 of 2026 and follows their certification, as part of its payroll and social insurance services.
Mahmoud Nassef, Founder Partner
Chartered Accountant, Ministry of Finance, Egypt
Member, Egyptian Society of Accountants & Auditors
Member, Egyptian Tax Society
Member, Egyptian Society for Public Finance and Taxation
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Disclaimer: This bulletin is prepared for general information on the legislation in force at the date of its publication. It does not constitute a professional opinion or tax or legal advice on any particular matter, and it should not be relied upon in place of advice based on an examination of the circumstances of each case. Nassef & Partners International accepts no responsibility for any action taken, or refrained from, in reliance on its contents. The positions stated remain subject to subsequent legislation and decisions.