The Senate finalized amendments to a new labor bill on Sunday, bringing some movement into a process that has stretched back several years, as new labor legislation languished in the House of Representatives.
The bill is not going to the president’s desk yet, however. It must now go to the House for further discussion and potential amendments before a reconciliation process and State Council overview.
However, the Senate’s approval is still a notable step in the long-stymied process.
To unpack what this version of the bill has put on the table and what may find its way into a final piece of legislation, Mada Masr spoke to Senators and labor activists about key policy issues and who had a hand in drafting the new regulations. .
While some of the amendments introduced by the Senate’s labor committee were hailed as positive reforms within the scope of what was able to be achieved, labor activists argue that the version of the bill approved by the chamber still did not tackle the biggest flaws in current legislation regulating the private sector labor market.
Which workers are affected by the new law?
The new labor law concerns all employees in the private sector, foreign nationals and workers in the companies that fall under the remit of the state’s public enterprise sector, according to Center for Trade Union and Workers Services coordinator Kamal Abbas.
Employees working in state bodies are covered by the civil service law.
Who is left out?
Domestic labor has long been excluded from labor bill discussions, with promises from the Manpower Ministry to present a separate bill for domestic workers that go back to 2017. However, such a bill has yet to materialize, Abbas tells Mada Masr.
Laborers in the informal sector — who represent about half of the labor market, according to data published by the Cabinet —also do not stand to see their situation change per the draft presented on the Senate floor. Some articles of the bill address seasonal labor, but they do not offer enough protection of seasonal laborers’ rights, Abbas says.
Who had a say in shaping the bill?
The Manpower Ministry introduced the first draft of the bill to Parliament in November 2013, after which the ministry held consultation sessions with the state-controlled Egyptian Trade Union Federation, as a representative of workers, and with representatives of business owners.
However, the first draft and the multiple drafts over the following years were repeatedly criticized by the ETUF, as well as labor organizations and political groups, for keeping many of the major flaws of the current labor law and even consolidating more powers in the hands of business owners.
What happened to the bill on its way to the Senate?
After multiple first drafts, Manpower Minister Mohamed Saafan announced in 2016 that a new version of the bill would be sent to the House of Representatives. However, in its regulatory oversight, the State Council pointed to 39 aspects of the bill that contravened the Constitution.
A new draft was finally sent to the 2015–2020 House for discussion back in 2018, but the legislature’s term ended before concluding the discussion around the bill.
The latest draft of the bill was sent to the Senate in November 2021, updated to accommodate the new trade unions law issued in 2017, which recognized unions independent from the EUTF for the first time.
Who were the principal architects of the Senate’s amendments to the new bill?
The labor committee, joined by the Constitutional and Legislative Committee, was tasked with introducing amendments to the bill before the general discussion in the Senate.
The committee invited what it considered representatives of “all sides” of the labor process, Senator Magdy Selim, a labor committee deputy, tells Mada Masr.
Representatives from the Federation of Egyptian Industries and the Federation of Chambers of Commerce, as well as the ministries of manpower, social solidarity and planning were invited to the discussions.
Opposite this greater representation of business owners and the Cabinet, the committee only invited the ETUF, which Abbas believes was not adequate representation for the various labor sectors coming under the law’s purview.
The committee, “did not create any community dialogue around the bill,” Abbas stresses, adding that CTUWS asked the Senate to conduct public hearings on the labor bill, but they did not receive a response. He also contacted members of the labor committee himself to request the start of community dialogue around the bill and received some positive promises. However, nothing came to fruition.
ETUF vice chairs Khaled Aish, also a Senate labor committee deputy, and Emad Hamdy, agreed, in comments to Mada Masr, that the federation was successful in pushing for some positive amendments that came out of the committee, but Hamdy noted that it also could not achieve its vision for several major points in the bill.
Q: What are the positive amendments approved by the Senate?
Dismissals: Article 125 was amended to make the new labor courts established in the bill the sole body with the power to dismiss workers deemed guilty of any of eight “grave” violations that were named in the current labor law.
These violations include impersonating another person or submitting forged documents, long unjustified absences, repeatedly ignoring safety guidelines, revealing secrets that harms the business, competing with the business owner in the same business, physically assaulting the business owner or any superiors, and being under the influence of drugs during work hours.
Maternity leave: Article 50 was amended to allow women to take a four-month paid maternity leave instead of the three stated in the bill, three times during her years of service. The amendment ensured that maternity leave offered to the private sector is equal to that offered under the civil service law and is in compliance with international agreements on motherhood, according to Aish.
Paternity leave: The amendments also secured one day of paternity leave for the birth of a child for the first time, at the request of 12 senators led by Senator Mohamed Farid.
Farid requested twice for the law to include a paternity leave of seven days, but his request was rejected. He told Mada Masr that he proposed the idea after speaking with several business owners, noting that, in practice, many fathers take days off to deal with the registration process for a newborn.
While the amendment was celebrated as the first labor legislation in Egypt recognizing fathers’ role in parenting, with media rhetoric about “strengthening the family bond,” the one-day leave seems more oriented toward accommodating the child registration process than giving the space for co-parenting.
Casual leave: An amendment to Article 105 increased the annual casual leave days from six to seven.
Fines for forced labor: An amendment to Article 253 raised the maximum fine for forced labor and discrimination in the workplace from LE5,000 to LE20,000 per worker. This fine will be doubled for repeat offenders.
The positive gains from increasing penalties relies on how efficiently the law is enforced, how regular Manpower Ministry officials monitor work places, and how easy it is for workers to report such issues. According to Abbas, Egypt has long-standing issues on these fronts.
What amendments were criticized?
Termination of contracts: : In the original formulation of Article 133, which has been the subject of controversy, “two parties of a contract” can terminate it at their discretion, as long as they give a three-month notice. The article passed with a minor amendment, proposed by Aish during the Senate general discussion. The amendment tied this article to Article 142 that requires business owners to offer a worker the equivalent of two months’ salary for each year of service if the contract is terminated for “illegitimate reasons.”
The bill lists some examples of these illegitimate reasons, such as their identity or social status, joining a union or filing a complaint or a lawsuit against their employer, while Article 134 reiterated that contracts should only be terminated for a “legitimate” reason. However, the bill remained vague about the “legitimate” reasons for terminating contracts, what guards the worker against illegitimate termination, or how these articles fit with the earlier articles on dismissal.
The clash between business owners’ power to terminate contracts and dismissal being conditioned on specific violations has been a major issue in the current labor law that has been a feature of every draft of the new bill. Since the current labor law came into effect in 2003, many workers who were fired arbitrarily faced conflicting judicial rulings, with some courts basing their decisions on the right to terminate contracts, while others upheld the dismissal clauses, according to Abbas.
Abbas and Hamdy agreed that the amendment was not enough to solve the issue, adding that the Article 133 undermines Article 125’s stipulation that the labor courts have the sole power to fire employees.
Fixed-term contracts: An amendment to Article 131 allowed fixed-term contracts to become permanent contracts if renewed for four years, instead of six as the bill originally laid out.
Hamdy noted, however, that it is still a loss for workers, as the current labor law allows fixed-term contracts to become permanent if they’re extended for even one day after the original period. He added that the ETUF failed to keep the old rule in the current bill during the labor committee discussions.
What positives were introduced to the bill that the Senate passed without change?
Approval of resignation: The bill introduced a stipulation to the articles on resignation that resignations must be approved by the relevant Manpower Ministry office.
This is intended to guard against a common practice in the private sector of firing workers under the guise of accepting their resignations. It involves business owners forcing new hires to sign a form, known as “Form 6,” which says they have resigned willingly and received all their dues, before they officially sign their contracts. Thus, workers can be fired at any time, and business owners can claim they have already resigned and been paid their dues.
Labor courts: The introduction of specialized labor courts to look into worker disputes has long been considered one of the major positives of the new bill, according to Abbas.
What major issues remained the same?
Strikes: Article 207 kept the prohibition in the current labor law against labor strikes in “strategic or vital facilities in which the cessation of work results in a breach of national security or disruption of basic services provided to citizens.” What counts as a breach in national security or disruption of basic services will be at the discretion of the prime minister.
Annual bonuses: Article 12 determined the annual bonus at 3 percent of the net salary instead of 7 percent of the basic wage in the current law, which Abbas says may lower total earnings.
He explains that the net salary includes the basic wage in addition to variables that different businesses do not offer equally, thus determining the bonus at a lower percentage of the net salary would leave many workers with a lower bonus.
According to Hamdy, the ETUF tried to push for changing the bonus to 7 percent of the net salary during the labor committee discussion, but they were not able to secure the change.
Hiring agencies: Both Abbas and Hamdy criticize the bill for legalizing the work of external hiring agencies, saying that reliance on them can open the gate for business owners to hire workers without being held directly responsible for safeguarding the rights enshrined in the law. Hamdy warned that hiring agencies might render the binding force of owner-worker contracts obsolete, adding that the EUTF pushed for more regulations of their operations to be stated in the bill, to no avail.