Introduction
In furtherance of governmental efforts to safeguard employee welfare amidst prevailing economic circumstances, both domestically and internationally, and in alignment with the aim of upholding equilibrium between employer and employee interests while furnishing requisite employee assistance, the National Wage Council (referred to as the “NWC”) has endorsed a substantial elevation in the minimum wage for private sector employees, effectively nearly doubling the prior minimum wage established earlier this year.
Overview
On April 8, 2024, the Egyptian National Council elevated the minimum wage for private sector employees by promulgating Decree No. 27 of 2024 (hereinafter the “Decree”), under the auspices of the Ministry of Planning and Economic Development. The Decree mandates the new minimum wage for private sector employees to be EGP 6,000 (six thousand Egyptian pounds), effective May 1, 2024, inclusive of the employer’s social insurance contribution
It is noteworthy that the minimum wage for private sector employees has progressively risen since 2022, as delineated below:
Date | Minimum Wage |
January, 2022 | EGP 2,400 |
January, 2023 | EGP 2,700 |
July, 2023 | EGP 3,000 |
January, 2024 | EGP 3,500 |
May, 2024 | EGP 6,000 |
The Decree specifies that the new minimum wage is computed pursuant to the salary definition elucidated in the extant Labour Law No. 12 of 2003 and encompasses the employer’s social insurance contribution. Typically, subsequent to a minimum wage hike or issuance of any employee-centric decrees, written circulars are disseminated to expound on their practical implementation
Moreover, the Decree affords leeway to companies grappling with economic adversities hindering compliance with the new minimum wage, permitting them to submit an exemption plea (through their respective competent trade union) by May 15, 2024. Such plea must furnish justifications for exemption along with corroborative documentation substantiating the same. It is further underscored that the Decree exempts small enterprises employing 10 (ten) or fewer individuals
The applicant employer is required to submit a request for exemption to the pertinent labor union, which will then act on behalf of the employer to present the request to the Ministry for deliberation. Requests for collective or group exemptions from industrial or business sectors will not be entertained
The request must meet the following criteria: