Pension settlement and end-of-service insurance benefits in Egypt
What does Egypt's social insurance authority pay when employment ends? A pension or a lump sum, plus the bonus balance. Claim within five years; NOSI pays within four weeks.
By Social Insurance & Labour Department · 15 October 2026 · 10 min read
Executive summary
- The pension is settled on the settlement wage, the monthly average of the wages on which contributions were paid (article 22 of the Social Insurance and Pensions Law No. 148 of 2019), up to a maximum of 80% of that wage, and the total pension cannot exceed EGP 13,360 in 2026 (article 24).
- If service ends without the pension conditions being met, lump-sum compensation is due: 15% of the annual wage for each year of contributions, paid in eight cases (article 26).
- The bonus system: 1% from the employee and 1% from the employer into a personal account, whose balance is paid with the pension or the compensation (articles 36 and 37).
- If an employee dies in service, the beneficiaries' pension is at least 65% of the settlement wage (article 24), and the employer pays a grant for the month of death and the two following months (article 33).
- The claim must be filed within five years (article 129), and NOSI must pay within four weeks of a complete claim, failing which it owes an additional amount (article 130).
This article covers what the National Organization for Social Insurance (NOSI) pays when a private-sector employee's service ends, and the steps and time limits. The pension age, the qualifying periods and early pension are covered in Retirement age and early pension in Egypt under Law 148.
The settlement wage and the pension calculation
Article 22 provides that "the settlement wage or income for the contribution period beginning on the date this law comes into force is determined on the basis of the monthly average of the wages or income on which contributions were paid". The law has applied since 1 January 2020 (article 7 of the issuing articles). Periods credited at the insured person's request and periods added by special laws and decrees are left out of the average (article 103 of the Executive Regulations, Prime Minister's Decree No. 2437 of 2021). Contribution periods before 2020 have a separate settlement wage (article 24).
The pension is settled "at one part of the factor corresponding to the insured person's age set out in Table (5)" for each year (article 24): settlement wage × contribution months ÷ 12 ÷ factor (article 105 of the Regulations). The pension for each period cannot exceed 80% of its settlement wage, nor the two together 80% of the higher settlement wage, and the total pension cannot exceed 80% of the maximum contribution wage at the date of entitlement: EGP 13,360 in 2026 (80% of 16,700). The figure changes on 1 January 2027 with the maximum wage, as explained in The social insurance contribution wage.
A worked example, assuming one settlement wage for the periods before and after 2020: a settlement wage of EGP 12,000, 35 years of contributions and a factor of 45 at age 60. The pension is 12,000 × 35 ÷ 45 = EGP 9,333.33, or 77.78% of the settlement wage. Neither example in this article includes the increase that article 163 grants once when the pension is first fixed.
Exit cases and what each one gives
| Case | Entitlement | Basis |
|---|---|---|
| Old-age pension age with the required period | Pension from the first day of the month in which entitlement arose | Articles 21(1) and 25 |
| Early pension | Pension from the first day of the month in which the claim was filed | Articles 21(6) and 25 |
| Death or total disability in service, or permanent partial disability where no other work is available with the employer | Pension of at least 65% of the higher settlement wage, plus additional compensation | Articles 21(2), 24 and 31 |
| Death or total disability within a year of leaving service | Pension of at least 65% of the higher settlement wage, provided the pension age has not been passed and no lump sum has been paid | Articles 21(4) and 24 |
| Death or total disability after a year | Pension if the contribution period reaches 180 actual months (the period required from 1 January 2025), on the same two conditions | Article 21(5) |
| Pension age, total disability or death without the pension conditions | Lump-sum compensation, plus an amount at the average treasury-bill rate | Article 26, items 6 to 8 |
| Emigration, or a foreign national leaving Egypt permanently | Lump-sum compensation | Article 26, items 1 and 2 |
For the third and fourth cases in the table, the pension requires a contribution period of at least three consecutive or six non-consecutive months. The condition does not apply in certain cases, including disability or death caused by a work injury (article 21); see Work injuries under Egyptian social insurance. The additional compensation is a percentage of the annual wage that depends on age at the date of entitlement, under Table (6) (article 31, as corrected).
Lump-sum compensation is calculated "at (15%) of the annual wage for each year of the contribution period in the insurance", the annual wage being the settlement wage multiplied by twelve (article 26). Article 26 does not list resignation or dismissal among the cases of payment. Read with article 37, this means that an employee who leaves before the pension age without meeting the early-pension conditions receives neither compensation nor the bonus balance on leaving; the period stays on file until one of the cases in articles 21 and 26 occurs.
The bonus system and what lies outside it
"The insured persons listed in item First of article (2) are subject to the bonus system" (article 36), that is, employees working for others; business owners are not covered (see Social insurance for employers and business owners). It is funded by 1% of the contribution wage paid by the insured person and 1% paid by the employer each month, deposited in a personal account that earns an investment return. The insured person receives "the balance available in the personal account when the event giving entitlement to insurance rights occurs under articles (21, 26)"; on death it goes to those entitled to the pension or compensation, and if there are none, to the legal heirs (article 37). For periods before 2020, the bonus in cases of pension age and death is one month's wage for each year (article 157).
This article does not cover unemployment insurance (Part Six of the law), nor the end-of-service gratuities that the employer itself owes under Labour Law No. 14 of 2025, which are a separate obligation from what NOSI pays.
Death in service: what the employer pays
When an insured employee dies, "a grant is due for the month of death and the two following months, in addition to the wage due for the days worked during the month of death". It is assessed on the wage for the month of death, and "the body that was paying the wage is liable for it" (article 33), that is, the employer. It is calculated on the full wage even above the maximum contribution wage, paid in one sum to those entitled to the pension, and is not due if there are none (articles 119 and 120 of the Regulations).
An example: an employee joins on 1 January 2026 on EGP 8,000, which is both the full wage and the contribution wage, and dies in service in August 2026. Table (5) treats death like reaching the pension age, so the formula uses the factor of 45: 8,000 × 8 ÷ 12 ÷ 45 = EGP 118.52. The pension is therefore raised to 65% of the settlement wage, EGP 5,200, payable to the beneficiaries from the first day of the month of death (articles 24 and 98), together with the additional compensation and the bonus balance. The employer pays a grant of EGP 24,000 plus the wage for the days worked in August.
Settlement steps and what holds them up
- The employer sends NOSI a list of the employees whose service will end on reaching the pension age, at least three months before the end of their service (article 142), and Form 6 within a week of any end of service (article 20 of the Regulations); details and the penalty for delay are in Social insurance Forms 1, 2 and 6. The end-of-service documents include a certified copy of the termination decision and the death certificate or disability assessment (article 12 of the Regulations).
- The person entitled files the claim on Form 20 for the insured person or Form 28 for beneficiaries (article 284 of the Regulations); NOSI's service page "Payment of the pension to beneficiaries on death" states that beneficiaries file it at the insurance region office.
- NOSI gives final notice of the rights on Form 33 to the pensioner and Form 34 to beneficiaries (articles 285 and 288 of the Regulations).
Rights are assessed "on the basis of the data and documents in the insured person's social insurance file, without reference to the service file" (article 127). Read with article 22, this means that wages on which no contributions were paid do not enter the settlement, even if they appear in the company's payroll. NOSI must meet the rights even if the employer did not insure the employee with NOSI; where it cannot verify the period or the wage, the pension or compensation is fixed on the undisputed period and wage, and the employer must pay the capital value of the pension and of the other benefits arising from the employment relationship once proven (article 141). These are the gaps that a social insurance inspection uncovers.
Time limits and disputes
| Time limit | Rule | Basis |
|---|---|---|
| Filing the claim | Five years from the date entitlement arose; after that, the pension is paid from the first day of the month of the claim plus the pensions for the five preceding years, and the rest lapses | Article 129; article 284 of the Regulations |
| Assessing and paying the rights | Four weeks from a claim filed with all the required documents | Article 130 |
| Late payment | An additional amount for each month, at a rate equal to the average of treasury issues of bills and bonds, from the date the documents were completed and capped at the principal, on a separate request | Article 130; article 286 of the Regulations |
| Changing the rights | NOSI may not change them three years after final notice, and claims to change them lapse at the same point, save in cases that include a final court judgment, a clerical error in the calculation and fraud; fifteen years from entitlement in all cases | Article 131 |
Before going to court, a request must be made to NOSI to refer the dispute to the dispute-examination committees (article 148). NOSI President's Decision No. 7622 of 2025 (Al-Waqa'i' Al-Misriya, No. 6, 8 January 2026) set up a committee in each insurance region. The committee must finish examining the request within thirty days of receiving it, and no lawsuit may be filed until thirty days after the request; the request does not suspend payment of amounts due to NOSI, except the disputed amounts (articles 1, 3, 5 and 6 of the Decision).
In disputes, the additional amount is due only from the date the lawsuit is filed, and NOSI recovers it from whoever caused the delay unless the delay was due to an administrative fault (article 130).
What this requires
- A list to NOSI of employees reaching the pension age, at least three months before their service ends.
- Form 6 within a week of any end of service, with the correct date and reason, and a certified copy of the termination decision.
- A reconciliation of the wages and periods on the NOSI file with the payroll before the employee leaves.
- On an employee's death: the death grant paid on the full wage to the pension beneficiaries, and the end-of-service documents delivered without delay.
- Proof of the date on which documents were delivered, and a review of the final notice as soon as it arrives.
The firm's Social Insurance & Labour Department reviews employees' insurance files before their service ends, prepares end-of-service notifications and claim documents and follows them up with NOSI, as part of its social insurance and labour compliance 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.