Legal Obligations in Construction Contracts Concluded by Employers Operating in Egypt

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1 Legal Obligations in Construction Contracts Concluded by Employers Operating in Egypt Copyright 2015, L&E Global We set out below important legal information that applies to all companies and entities that contract for construction works with any contractor, whether within their premises or on any other site. We also set out below other legal information on the more general subject of security in the workplace. Employer s general obligation to ensure safety, professional health and security of the work site: An employer and the contractor he hires for contracting works are jointly liable to provide the conditions and precautions for safety, professional health and security of the workplace provided in Chapter Three of Book Five of the Labour Law (Article 1 of the Decree of the Minister of Manpower and Immigration no. 211 for the year 2003). This obligation specifically entails the following (Id.): The requirements for safety and professional health must be provided in the workplace and in the equipment by the employer or the manager. The contracting agreement must include a clause obligating the contractor to provide the requirements for safety and professional health to the contractor s employees. If the contractor fails to provide these, the employer is under the obligation to provide them and to hand over the personal safety kits to the contractor s employees. The employer shall deduct the value from the contractor s dues (the agreement should say so). Penalty for the failure to abide by safety regulations: Failure to abide by the regulations of safety, professional health and security of the work place mentioned in the Labour Law and the relevant decrees (the above is only one of them) will incur a penalty of imprisonment for a period not less than 3 months and a fine of not less than one thousand pounds and not exceeding ten thousand pounds or with either of these penalties. Both penalties of imprisonment and fines will be obligatory if the failure to abide by the regulations of safety, professional health and security of the work place resulted in death or major injury. In addition, the employer (the company itself) or the legal representative of the employer/company will be jointly liable with the person who committed the crime in the settlement of the financial penalties, if the crime was committed as a result of their failure to abide by the obligations imposed by the law. The above penalties apply to the failure to abide by security obligations in the context of construction contracts as well as on the failure to abide by all other safety regulations mentioned by the law.

2 Furthermore, the employer will be liable in tort for any damages that arise as a result of the employer s failure to comply with the above safety regulations or with any other safety regulations that are not provided by law, but are necessary in the industry or according to custom. Requirements of safety, professional health and security of the work site: The requirements for safety, professional health and security of the workplace are diverse, branched out in multiple regulations and vary from industry to industry depending on size and activity. We set out in Annex 1 the general safety requirements that apply in the context of construction agreements. We also set out in Annex 2 other general safety requirements that apply to most businesses outside of the context of construction agreements. Should you need more details, please refer to Chapter Three of Book Five of the Labour Law No. 12 for the year 2003; to Decree of the Minister of Manpower and Immigration no. 211 for the year 2003 regarding the Safety Limits, Requirements & Precautions Necessary for the Avoidance of Physical, Mechanical, Biological, Chemical and Passive Risks and for Securing the Work Place; and to Decree of the Minister of Housing and Urbanization no. 380 for the year 1975 concerning the General Requirements that must be Satisfied in Industrial, Commercial and Other Establishments that Cause Disturbances or Harm the Health. Copies are available upon request. 2

3 ANNEX 1 Requirements for Safety, Professional Health and Security of the Workplace Applicable in the Context of Construction Agreements (*) A. General requirements: (Articles 1 and 14 of the Decree of the Minister of Manpower and Immigration no. 211 for the year 2003): The employer who hires a contractor and the contractor who hires a subcontractor for any operation must send a notification to the Manpower Directorate at least one week before starting the operation stating the name of the employer or the main contractor, name of subcontractor, kind of operation and its execution time, number of workers, the place of operation. Appropriate precautions must be taken to ensure that the workplace is safe and free from the risk of harming the safety and health of workers. Safe access points to and from the site must be provided with adequate signs. The site must be provided with the necessary safety tools such as protective hard hats for the head and rubber boots and so forth. Ceilings of the workplace should be fenced off if the nature of the work requires the ascension to them as well as fencing or covering the skylights that interpose these ceilings in a way that prevents the fall of persons or things from them. Protective screens and barriers must be provided to protect workers and passers-by from the risk of things falling on them. Adequate lighting must be provided to all places that are being accessed by workers. B. Scaffolds: (Article 15 of the Decree of the Minister of Manpower and Immigration no. 211 for the year 2003): The scaffolds and the walkways should be well installed, with enough resistance to the loads and with enough width that allow the workers to safely pass by them without being exposed to falling, and should also be surrounded by side barriers if they are higher than four meters from the land. Workers should be provided with protective equipment against the fall. While carrying out construction work inside the cities and to guarantee the safety of passers-by and the public, the scaffold must be covered by plastic or cloth curtains from ( * ) The mentioned requirements are only a summary of the most general obligations. For more details, please refer to to Chapter Three of Book Five of the Labour Law No. 12 for the year 2003; to Decree of the Minister of Manpower and Immigration no. 211 for the year 2003 regarding the Safety Limits, Requirements & Precautions Necessary for the Avoidance of Physical, Mechanical, Biological, Chemical and Passive Risks and for Securing the Work Place; and to Decree of the Minister of Housing and Urbanization no. 380 for the year 1975 concerning the General Requirements that must be Satisfied in Industrial, Commercial and Other Establishments that Cause Disturbances or Harm the Health. 3

4 the side overlooking the main street so that they prevent the fall of the materials from the top and prevent the spread of the dust. C. Ladders: (Article 18 of the Decree of the Minister of Manpower and Immigration no. 211 for the year 2003): Ladders and high walkways or similar places must be made of suitable materials that prevent sliding. Ladder steps must be of enough solidity and width that allow for safe passage and must be surrounded by barriers from both sides. They must also be covered to avoid the fall of the materials through them. D. Demolition works: (Article 19 of the Decree of the Minister of Manpower and Immigration no. 211 for the year 2003): An experienced technical supervisor must be present throughout the demolition works. Precautions must be taken to guarantee the safety of passers-by. E. Digging works: (Article 20 of the Decree of the Minister of Manpower and Immigration no. 211 for the year 2003): Dust raised from digging must not accumulate beside the digging area. A protective fence with specified coordinates should surround the excavated area. Florescent signs and warning signs must be put on the sides and lighting should be provided at night. F. Use of explosives: (Article 26 of the Decree of the Minister of Manpower and Immigration no. 211 for the year 2003): Measures must be taken for storage safety, dealing and use of explosives in accordance with factory recommendations. Electric detonators shall not be used near any source of electricity. An accurate survey must be conducted to disclose the presence of any unknown electric currents in the region of explosion and storage. Warning signs must be put in the explosion regions and in storage areas. They have to be in Arabic, clear and easy to understand. G. Risks of equipment and machines: (Article 27 of the Decree of the Minister of Manpower and Immigration no. 211 for the year 2003): Equipment and machines installed at the workplace must be in accordance with the approved standard specifications; must be provided with the means of personal protection and must be suitable for the nature of the work. Instructional signs must be 4

5 posted near such equipment and machines to explain the instructions regarding personal safety. Turbines should be fenced. Maintenance of equipment is periodically carried out by trained specialists. H. Winches and lifters: (Article 30 of the Decree of the Minister of Manpower and Immigration no. 211 for the year 2003): It is not permitted to assign any worker under eighteen-years old or an unqualified worker to deal with winches and cranes. 5

6 ANNEX 2 Some requirements for Safety, Professional Health and Security of the Workplace (**) A. General requirements: (Articles 1 and 7 of the Decree of the Minister of Manpower and Immigration no. 211 for the year 2003): The walls and ceilings and all parts of the establishment such as containers, machines and equipment must be safe and clean. Damages should be repaired consistently. Floors must remain clean and even. Places for eating, drinking and smoking must be provided away from the workplace. The movement of disabled persons must be planned in new facilities. Existing establishments should be modified adequately. This is especially important in establishments that are obligated to hire a percentage of disabled persons. According to Article 9 of Law no. 39 for the year 1975 for Rehabilitation of the Disabled, employers who employ fifty or more employees, whether they are working in one place or one country or in different places or countries, are obliged to hire five percent of the total number of workers from disabled persons who are nominated by the Ministry of Manpower or through their own recruiting means. Adequate lighting should be provided for all work places. Certain specifications are determined by law for various activities. B. The location of the workplace and the preparation and equipping thereof: The Decree of the Minister of Housing and Urbanization no. 380 for the year 1975 concerning the General Requirements that must be Satisfied in Industrial, Commercial and Other Establishments that Cause Disturbances or Harm the Health provides many general requirements concerning the location and the furnishing and equipping of the workplace, including minimum specifications for wall and floor covering and of sanitary rooms and toilets, ventilation, and other detailed specifications. C. Requirements pertaining to passive risks: (Article 40, 41, and 42 of the Decree of the Minister of Manpower and Immigration no. 211 for the year 2003): The workplace must be clean, especially floors which must be clear of residue, obstacles and sticky substance that cause slipping. ( ** ) The mentioned requirements are only a summary of the most general obligations. For more details, please refer to to Chapter Three of Book Five of the Labour Law No. 12 for the year 2003; to Decree of the Minister of Manpower and Immigration no. 211 for the year 2003 regarding the Safety Limits, Requirements & Precautions Necessary for the Avoidance of Physical, Mechanical, Biological, Chemical and Passive Risks and for Securing the Work Place; and to Decree of the Minister of Housing and Urbanization no. 380 for the year 1975 concerning the General Requirements that must be Satisfied in Industrial, Commercial and Other Establishments that Cause Disturbances or Harm the Health. 6

7 Workers involved in cooking and presentation of food must have health certificates showing their bareness of epidemic and infectious diseases. Appropriate personal protective tools and equipment should be provided to the worker according to the type of risk he might face. D. Requirements pertaining to first aid: The employer must provide medical aid utensils for workers in the workplace which complies with the nature of the work and the number of workers. Medical aid utensils must be placed in a visible, safe place which can be accessed by all workers. (Article 37 of the Decree of the Minister of Manpower and Immigration no. 211 for the year 2003.) A primary medical check must be conducted to the employee before joining the work to make sure of his safety and fitness according to the type of work assigned to him. (Article 1 of the Decree of the Minister of Manpower and Immigration no. 153 for the year 2003). E. Requirements pertaining to fire hazards: Any medium size or large institution applying for permits for construction of administrative or commercial premises or industrial establishments must abide by the Egyptian Fire Code (Articles 39 and 40 of Law no. 119 for the year 2008 issuing the Building Law and Articles 106 and 107 of the Decree of the Minister of Housing, Utilities and Urban Development no. 144 for the year 2009 issuing the Executive Regulation of the Building Law). The institution must take the necessary precautions for the prevention of fire hazards as determined by the Ministry of Interior regulations and according to the type of activity being practiced at work premises (Article 2 of the Decree of the Minister of Manpower and Immigration no. 211 for the year 2003). Measures imposed by the Ministry of Interior s Civil Defence Authority includes the provision of a source of backup power to run tools and fire extinguishers, equipment and other devices in case the power was cut off; preparing emergency entrances and exits with the appropriate signs and means of lighting in accordance with the emergency plan of the institution; providing guidance and demonstration signs that raise awareness and in all parts of the institution; avoiding the collection of rubbish and waste, especially in the skylights and throwing it periodically to avoid causing of fires; taking into account the periodic detection of air conditions installed in the skylights. Institutions that use and produce hazardous materials are requested by the Civil Defence Authority to provide suitable insurance to the employees against the risks they face at the institution. The fire extinguishing equipment and instruments used, whether fixed or mobile, must be in accordance with the standard specifications and Egyptian Law No. 58 of 1973 and the implementing decisions regulating the industry of fire extinguishers and their packaging , v. 1 This article was written by Sharkawy & Sarhan Law Firm 7

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