Global PEO in Egypt
Egypt has a growing economy despite the impact COVID-19 has had upon its tourist industry and it is rising up the ranks in the World Bank’s ease of doing business scale.
The country offers an affordable cost of living, particularly for expats, whilst its ancient history, deserts, beaches, and vibrant cities make it a wonderful place to live and work.
Want to expand into Egypt? With a PEO like Skuad, you can hire Egyptian employees and reach a new market. Check out our services here.
What is a PEO?
A professional employer organization (PEO) offers international HR and hiring support.
With the help of a PEO, companies can outsource their HR responsibilities including onboarding, benefits, and payroll. A PEO can also ensure that companies hiring internationally comply with all labor laws and tax obligations in the country in which an employee is based.
Ultimately, a PEO makes it easy for SMEs to expand their business on the global stage without the need for an in-house HR team or an owned entity overseas.
Companies can hire the very best talent from around the world, focusing their energies on getting the most out of their global team rather than complex international compliance.
Want to start hiring in Egypt? Find out if a professional employer organization in Egypt is right for your business by chatting to one of the Skuad team today.
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What are the benefits of using a PEO provider in Egypt?
Hire the best talent in Egypt (and the rest of the world)
Businesses no longer have to restrict their talent search to the local area.
Global hiring is an ideal way to overcome the challenges posed by the current labor shortage and the intense competition for skilled workers.
With the help of a PEO, you can hire talented employees – no matter where they live in the world.
Egypt has a young and growing population, which equates to a huge labor force. The government is also investing heavily in IT education, with the country already boasting a large number of highly skilled tech professionals.
If your ideal new team member lives in Egypt, a PEO service in Egypt can help you to hire and pay them. They’ll also take responsibility for onboarding and benefits, and will navigate tricky Egyptian labor law – so you don’t have to.
Avoid setting up your own legal entity in Egypt
There is an alternative to using a PEO in Egypt. But it involves going it alone to set up your own subsidiary in Egypt.
To do this, you’ll need to get to grips with Egyptian business and labor law. You’ll also have to train your HR team to manage Egyptian payroll and tax responsibilities.
Inevitably, this involves trips to Egypt, a team of lawyers, high costs, and lots of your time.
With a PEO, you can avoid this process altogether. The best PEOs already have a legal entity in Egypt. This means they can legally hire and pay Egyptian employees on your behalf.
When you partner with a PEO, you get to save a heap of time and money; that’s time and money you can use to better manage your team and grow your business.
How much does it cost to use PEO services in Egypt? Take a look at Skuad’s flat fee pricing structure.
Maintain your agility
As a small business, agility is probably one of your main USPs. But what happens if you choose to set up an Egyptian subsidiary for your business?
We’ve already touched on the time and money you have to invest into this process. And when you’ve put so much in, you’ll want to make sure your investment provides good ROI.
That might mean hiring a large Egyptian team and committing to doing business in Egypt over the long term.
If this fits with your plans, great! But if you want to hire just one talented Egyptian developer, or if you don’t feel ready to jump into the Egyptian market feet first, a subsidiary doesn’t give you the flexibility you need.
With a PEO, however, you maintain your agility. You can hire as few or as many Egyptian employees as you like. And you have the option to exit Egypt – or any other country – if it no longer benefits your business.
Companies doing business in Egypt have to abide by all local employment laws and tax responsibilities. Fail to do so, and they face hefty fines, penalties, and even business bans.
Getting to grips with a legal and tax system in a new country is no mean feat. But – work with a PEO – and they have you covered.
You can count on a team of local experts who know exactly what is required of your business. They’ll advise you of your responsibilities and ensure all of your global operations remain 100% compliant.
Here are just some of the things they’ll be able to tell you about doing business in Egypt.
Payroll in Egypt
- The local currency in Egypt is the Egyptian Pound (EGP).
- The minimum monthly wage varies depending upon whether an employee works in the public or private sector.
- Employers have to pay a minimum of 2,700 EGP – around $147 – per month to public sector employees and 2,400 EGP per month to private sector employees.
- Employees are paid monthly, no later than the 5th day of the following month.
- The standard working week involves 40 hours, worked over eight-hour days.
- Employers pay overtime to any employee working more than 40 hours a week. Overtime is paid at 135% of the regular salary for overtime completed during daylight hours and 170% of the usual salary for overtime completed at night.
Employer contributions and tax rates in Egypt
Employee tax contributions
In Egypt, income tax rates for employees are as follows:
15,001 EGP – 30,000 EGP: 2.5%
30,001 EGP – 45,000 EGP: 10%
45,001 EGP - 60,000 EGP: 15%
60,001 EGP - 200,000 EGP: 20 %
200,001 EGP - 400,000 EGP: 22.5%
Over 400,000 EGP: 25%
Employee payroll contributions
Employees working in Egypt pay 11% of their gross salary to cover social security contributions.
Employer payroll contributions
Employers must contribute 19.75% of an employee’s salary to cover social insurance and unemployment insurance.
Egypt's corporate tax rate
In Egypt, the corporate tax rate is 22.5%.
Paid leave in Egypt
Egypt celebrates 16 public holidays.
Employees are also entitled to 21 days of paid annual leave once they have worked at a company for six months. This rises to one month of leave once an employee has worked for an employer for ten years or is aged 50 or over.
Women are entitled to a minimum of 90 days of maternity leave. Employers will often stipulate that women can only take maternity leave twice during a five-year period.
When they work for companies where there are more than 50 employees, women can take up to 24 months of unpaid parental leave for each of their children.
Men are not entitled by Egyptian employment law to paternity leave or parental leave.
Skuad can take care of all Egypt employment laws and tax compliance – so you don’t have to. Book a platform demo to find out more.
What does it cost to build a team in Egypt?
The cost of building an Egyptian team depends upon how you choose to do it. There are two main options available to companies who don’t already have a base in Egypt:
Establishing a legal entity in Egypt
To operate as an international business in Egypt, you can choose to establish a legal entity in the country. Essentially, you’re setting up a business in Egypt, which means you’ll be able to hire employees there.
This is a time-consuming process that can cost a business tens of thousands of dollars. You have to factor in:
- Legal costs
- Travel costs
- HR training costs
- Office space costs
- Banking costs
- Egypt company registration
Generally, this is a preferred option for large enterprises that see an Egyptian operation as part of their long-term global expansion plan.
Partnering with PEO services in Egypt
For SMEs and agile enterprises, PEO services in Egypt are a more affordable alternative.
A PEO already has an owned entity in Egypt, which means they can act as your employer of record in Egypt. They can hire and pay your Egyptian employees, whilst ensuring you meet all tax and labor law requirements.
The cost of PEO services in Egypt depends upon the provider and the package you choose.
At Skuad, we’ve made our pricing structure simple and transparent. Prices start from a flat fee of $199 per employee per month.
Our clients get their first hire for free and can make global payments free of charge. And they can cancel the service at any time – ensuring they’re always getting a PEO package that suits their business needs in the here and now.
Ready to start onboarding and paying employees in Egypt? With Skuad you can be hiring in Egypt within a matter of days. Schedule a Skuad demo to see our platform in action.