Unwritten Employment Contracts Under Egyptian Labour Law

A missing employment contract may cost an employer far more than the effort required to prepare one.

Under Egyptian Labour Law No. 14 of 2025, the absence of a written employment contract is not merely a procedural irregularity. The Law attaches specific legal consequences to undocumented employment relationships, including treating them as indefinite-term contracts from the outset. This can significantly affect the parties’ contractual rights and, in particular, the employer’s position when seeking to terminate the employment relationship.

What may initially appear to be an administrative oversight can therefore become a source of substantial legal and financial exposure. Understanding how the Law addresses unwritten employment relationships is essential for employers seeking to manage their workforce while remaining compliant with their statutory obligations.

Legal Status of Unwritten Employment Contracts

Under Article 88 of Labour Law, an employment contract is automatically deemed an indefinite-term contract from its inception where it is not made in writing, does not specify its duration, or where the parties continue performing their obligations after the expiry of a fixed-term contract without entering into a written agreement.

Accordingly, an employer’s intention to establish a fixed-term employment relationship will not be sufficient unless its duration is properly documented in writing. This classification has important implications for the termination of employment, particularly the applicable notice requirements and compensation

Employer’s Obligations Regarding Employment Contracts and Employee Records

Article 89 of Labour Law requires employers to prepare employment contracts in writing, in Arabic, and in four original copies. One copy must be retained by the employer, another delivered to the employee, a third deposited with the competent Social Insurance Office, and the fourth with the competent administrative authority.

The contract must include the essential particulars of the employment relationship, including the identities and details of both parties, the commencement date, the employee’s occupation or profession and qualifications, the nature of the work, the employer’s workplace address, and the agreed remuneration, together with its method and date of payment and any additional monetary or in-kind benefits. Where a foreign employee does not understand Arabic, the contract may also be prepared in the employee’s language. However, the Arabic version prevails in the event of any discrepancy in interpretation.

Importantly, the absence of a written contract does not prevent either party from proving the existence and duration of the employment relationship, or the rights arising from it, through all available means of evidence. Such evidence may include correspondence, salary records, attendance records and other employment-related documents. Consequently, an employer cannot rely on the absence of a signed contract to deny the employment relationship or avoid the obligations arising from it.

Importantly, the absence of a written contract does not prevent either party from proving the existence and duration of the employment relationship, or the rights arising from it, through all available means of evidence. Such evidence may include correspondence, salary records, attendance records and other employment-related documents. Consequently, an employer cannot rely on the absence of a signed contract to deny the employment relationship or avoid the obligations arising from it.

Beyond the execution of written contracts, Article 92 requires employers to establish and maintain an individual file for each employee, whether in physical or electronic form. The file must contain the employee’s personal and professional particulars, including their name, occupation, skill level upon commencement of employment, place of residence, marital status, commencement date and remuneration, together with any subsequent changes to these details. It must also include a copy of the employment contract, records of disciplinary sanctions and leave taken, investigation records where applicable, performance reports prepared in accordance with the establishment’s internal regulations, proof of social insurance registration, the initial medical examination and any other documents relating to the employee’s service.

Access to employee files must be restricted to persons legally authorised to review them. Employers must also make these files available to the competent administrative authority or labour court, as applicable, upon request. Furthermore, Article 92 requires employers to retain employee files for at least five years following termination of the employment relationship. Where judicial proceedings are pending, the relevant file must be retained until a final, non-appealable judgment has been issued, even if the five-year period has already expired.

Failure to comply with Articles 89 and 92 attracts the penalties prescribed under Article 288, ranging from EGP 500 to EGP 5,000, multiplied by the number of employees concerned and doubled in the event of recidivism.

Termination of Unwritten Employment Contracts and Financial Consequences

The classification of an unwritten employment contract as indefinite-term can have significant financial consequences for employers, particularly where the parties originally intended to establish a fixed-term employment relationship..

Under Article 154 of Labour Law, a fixed-term employment contract ordinarily expires upon completion of its agreed duration. However, where a contract is concluded or i renewed for a period exceeding five years, the employee may terminate it without compensation after completing five years of service, provided that three months’ prior notice is given. Conversely, if the employer terminates the contract after the expiry of the five-year period, the employee is entitled to a gratuity equivalent to one month’s wage for each year of service..

By contrast, where an employment relationship is deemed indefinite-term under Article 88 due to the absence of a written contract, the employer cannot rely on the expiry of an intended contractual period to terminate the relationship. Instead, termination becomes subject to the statutory requirements applicable to indefinite-term contracts.

In this regard, Article 156 requires the employer to provide three months’ prior written notice, while Article 157 prohibits termination without a legitimate and sufficient justification. Furthermore, under Article 165, where the employer terminates the employment contract without legitimate grounds, the employee is entitled to compensation of no less than two months’ wages for each year of service, without prejudice to any other statutory entitlements.

Accordingly, failing to document a fixed-term employment relationship may deprive the employer of the ability to rely on the contractual expiry mechanism and expose it to the more substantial compensation requirements applicable to unlawful termination of indefinite-term contracts.

Conclusion

The absence of a written employment contract does not reduce an employer’s obligations under Labour Law. On the contrary, it may result in the automatic classification of the employment relationship as indefinite-term, limiting the employer’s ability to rely on fixed-term arrangements and potentially increasing its financial exposure upon termination.

Employers should therefore review their existing employment arrangements to ensure that all contracts are properly documented, employee files are maintained in accordance with the Law, and any changes to contractual terms are recorded in writing.

Ultimately, proper employment documentation is not simply a statutory formality; it is an essential safeguard against avoidable employment disputes and unnecessary legal and financial liabilities.

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