Disciplinary Action Policy in Egypt: 2025 Labour Law Rules

A disciplinary action policy in Egypt has to do two jobs: list the violations your company treats as misconduct, and link each one to a penalty the law actually allows. Labour Law No. 14 of 2025 gives employers a closed list of eight penalties, a hard cap on pay deductions, and a mandatory written investigation. Dismissal is no longer the employer's call at all: it belongs to the labour court.

That last point catches many regional and foreign-owned companies off guard. Their policy often comes from a group handbook written for the UK or the Gulf, with "final written warning, then termination" as the default ladder. In Egypt, that ladder ends in a court application, not a letter from HR.

TL;DR: Build the policy in three layers. First, a violation list drawn from the employee duties in Article 134 and the prohibitions in Article 136. Second, a progressive ladder that uses only the eight penalties in Article 139. Third, a procedure section: written notice, a hearing, an investigation that starts within 7 days (Article 141), and deductions capped at five days' basic pay per month (Article 143). This is general information, not legal advice.

Who needs a written disciplinary action policy?

Article 137 of Labour Law No. 14 of 2025 requires every employer with ten or more workers to issue work regulations that include, among other things, violations of job duties and the disciplinary penalties for them. You have 60 days from opening, from reaching ten employees, or from the law taking effect. A copy goes to the competent administrative authority for approval, and the regulations must be posted visibly at every site.

Under ten employees, the approval duty does not apply by its wording. Even so, Article 139 ties every penalty to "work and penalty regulations in the establishment". A short policy that each new hire signs on day one is the minimum. Our onboarding checklist shows where it fits.

Attendance rules are only one chapter of a disciplinary action policy. We cover lateness, absence and deemed resignation separately in our attendance policy guide. This article covers the whole framework.

The eight penalties Egyptian law allows

Article 139 sets out the penalties exhaustively. Anything outside this list, such as a standalone "fine" or a "loss of bonus" clause, is a risk.

#	Penalty	Legal limit
1	Written warning	None; the lightest step
2	Deduction from basic pay	5 days per violation and 5 days per month (Art. 143)
3	Postponing the annual increment	Up to 3 months
4	Withholding part of the annual increment	Up to half of it
5	Postponing a due promotion	Up to 1 year
6	Reducing basic pay	By one increment at most
7	Demotion to the grade directly below	Pay is not reduced
8	Dismissal	Per the law, by the labour court (Art. 148)

Two details matter in practice. Deductions come from basic pay, not gross pay. And if your policy states a deduction as a percentage, Article 143 reads it as a percentage of daily basic pay.

Writing the violation list

Start your disciplinary action policy from duties, not punishments. A violation is only punishable if it relates to work (Article 138), so anchor every line in the statute:

1. Timekeeping: lateness, leaving early, and absence without following the reporting procedure (Article 134, item 3).
2. Performance: not completing assigned work on time, or refusing lawful work instructions (items 1 and 2).
3. Company property: losing or damaging tools, devices or documents through negligence (item 4).
4. Customers and colleagues: mistreating clients, or disrespecting managers and coworkers (items 5 and 6).
5. Safety and security: breaching site safety and security rules (item 8).
6. Confidentiality: disclosing confidential information, or keeping work documents and electronic data (Article 134 item 9; Article 136 item 1).
7. Conflicts of interest: working for a competitor, or accepting gifts or commissions linked to the job without approval (Article 136, items 2, 3 and 5).

Write each violation as a fact someone can prove. "Unprofessional behaviour" cannot be investigated. "Did not log the end-of-day stock count before closing the till" can.

A progressive discipline ladder you can adapt

The ladder below is illustrative. The step values are our example, not text from the law; set yours with a lawyer, inside the limits of Articles 139 and 143.

Violation	1st	2nd	3rd	4th
Late beyond the grace period	Written warning	Quarter-day deduction	Half-day deduction	One-day deduction
Unreported one-day absence	One-day deduction	Two days	Three days	Increment postponed
Careless damage to equipment	Written warning	One day	Two days	Three days
Rude conduct with a customer	Written warning	Two days	Four days	Pay reduced by one increment
Breaking written safety rules	One day	Three days	Five days	Apply to court for dismissal

Three rules keep the ladder inside the law, whatever your disciplinary action policy template looked like before. Repeat offences can be escalated only if they recur within one year of the employee being notified of the previous penalty (Article 144). Only one penalty is allowed per violation (Article 140). And total deductions for penalties cannot exceed five days' pay in any month (Articles 140 and 143), so a bad month moves the employee to non-financial steps.

Procedure: the part most policies skip

A disciplinary action policy without procedure is the weakest kind. Article 141 says no penalty may be imposed until the employee is told in writing what they are accused of, heard, and their defence investigated, with minutes placed in their file.

Step	Rule	Article
Start the investigation	Within 7 days of discovering the violation	141
Length	Up to 3 months, extendable by 3 more if new facts emerge	141
Oral hearing allowed	Only for a warning or a deduction of up to one day	141
Investigator	Legal affairs; otherwise an expert or employee at least as senior as the accused	142
Deadline to decide	No penalty more than 30 days after the investigation ends	138
Who signs	Employer or delegate; a site manager may issue warnings and deductions up to 3 days	148
Decision	Must state its reasons	141

Article 145 also allows a written suspension of up to 60 days on full pay, for example when an investigation into on-site misconduct requires it. Every penalty and investigation record goes into the employee file required by Article 92, which matters later if the person leaves; see our exit clearance guide.

Dismissal belongs to the labour court

Under Article 148, the competent labour court decides dismissal, and only for a serious fault. The article lists examples: false identity or forged documents; a fault causing serious damage, reported to the authorities within 24 hours; repeated breaches of posted, written safety instructions after a written warning; disclosing secrets with serious harm; competing with the employer; being drunk or drugged at work; and assaulting the employer, the general manager or, seriously, a supervisor.

So the top rung of an Egyptian ladder reads "apply to the labour court", and HR's job is to arrive there with a clean file.

How Yawmy fits into discipline

Most disputes are not about the policy. They are about facts: when did the employee arrive, and was the task due today? According to the Yawmy website, the app gives managers a record for the time-based and task-based parts of a case:

• GPS-verified check-in and check-out from the iOS or Android app, or from a Telegram bot.
• Task assignment with completion tracking, plus visit reports from sales reps.
• Lateness and working-hours reports by employee and by department.

Yawmy does not run investigations or issue penalties. It supplies dated evidence for the written notice. To compare tools, start with employee attendance software in Egypt. To draft the first rung of the ladder, see our employee warning letter guide.

FAQ

Is there an official disciplinary policy template from the Ministry of Labour?

Article 137 lets the minister issue general rules for work regulations, but each employer still writes its own and submits it for approval. Ask the labour directorate that covers your site which rules and forms currently apply; contact details are on the Ministry of Labour website.

How much salary can an Egyptian employer deduct as a penalty?

No more than five days of basic pay for a single violation, and no more than five days of basic pay in any one month for all penalties together (Article 143). Once the monthly cap is reached, use non-financial penalties such as a written warning or a postponed increment.

Can a written warning be given without an investigation?

Not without any process. Article 141 allows the investigation to be oral for a warning or a deduction of up to one day, but its content must be recorded in the penalty decision, and the decision must give reasons.

Can I dismiss an employee myself for gross misconduct?

No. Article 148 assigns dismissal to the competent labour court and limits it to serious faults. You can investigate, suspend on full pay for up to 60 days under Article 145, and apply to the court.

Does an old policy written under Law 12 of 2003 still work?

It needs review. The 2025 law repealed Law 12 of 2003 and introduced labour courts for dismissal, so ladders ending in "termination by the employer" no longer match the statute.

Written by Nada Hassan, HR-Tech Strategist, Yawmy. This article is general information, not legal advice.

Want every disciplinary file to start from a time-stamped attendance and task record? Start with Yawmy for free.