Get Live Quote 
Egyptian Labour Law now requires private-sector employers to grant employees a mandatory annual salary increase of at least 3% of the employee's social insurance salary, with a minimum monthly increase of EGP 250. Employees become eligible after completing one year of service and one year since their last salary increase. The increase is calculated on the social insurance salary (capped at EGP 16,700/month for 2026), not total gross pay for high earners. This requirement takes effect January 1, 2026.
Egypt mandates 3% annual salary increase for private sector employees effective January 1, 2026
Egypt's Labour Law now requires private-sector employers to grant employees a mandatory annual salary increase of at least 3% of the employee's social insurance salary, with a minimum monthly increase of EGP 250. The requirement takes effect January 1, 2026, and applies to employees who have completed one year of service and one year since their last salary increase.
Who is affected
All private-sector employers in Egypt with employees whose compensation is subject to social insurance under the Egyptian Labour Law must comply. Employees become eligible after completing at least one year of service with their employer and once at least one year has passed since their last salary increase. There is no company size threshold—the requirement applies to all private-sector employers.
What's changing
Before January 1, 2026, Egyptian Labour Law did not mandate a minimum annual salary increase for private-sector employees. Starting January 1, 2026, employers must grant eligible employees an annual increase of at least 3% of the employee's social insurance salary, with a floor of EGP 250 per month.
The increase is calculated on the social insurance salary, which is capped at EGP 16,700 per month for 2026 (rising to EGP 19,300 for 2027). Employees whose actual gross salaries exceed the cap receive the increase calculated on the capped amount, not their total gross pay.
| Employee monthly salary | 2026 social insurance cap | Minimum increase (3% or EGP 250 floor) |
|---|---|---|
| EGP 2,000 | EGP 2,000 | EGP 250 (floor applies) |
| EGP 10,000 | EGP 10,000 | EGP 300 |
| EGP 50,000 | EGP 16,700 (capped) | EGP 501 |
What NEO partners and clients should do
- Review employee eligibility by December 31, 2025: identify all employees who have completed one year of service and one year since their last salary increase.
- Calculate and apply the mandatory increase in the January 2026 payroll cycle, using the social insurance salary (capped at EGP 16,700 for 2026) as the base.
- Update employment agreements and compensation records to reflect the new salary effective January 1, 2026.
- Confirm with your Employer of Record (EOR) provider that the mandatory increase is applied for all eligible employees if you use an EOR in Egypt.
Sources
- Egyptian Labour Law (official regulator source not provided in available materials)
