Laws and Policies in Lebanon

Employment Laws and Policies in Lebanon

Employment Contracts in Lebanon

Employment law in Lebanon is governed by Lebanese Labour Law (Code du Travail libanais) enacted 1946, as amended.

Important Note: Lebanon’s Labour Law dates from 1946 (French mandate era), with some amendments but fundamentally old framework. Modern employment practices often exceed statutory minimums given educated workforce expectations and international company standards.

Contract Requirements

Employment contracts should be in writing (strongly recommended, though oral contracts recognized).

Written contracts should include:

• Full names and addresses of employer and employee
• Job title and description of duties
• Place of work
• Start date of employment
• Contract type (indefinite, fixed-term)
• Duration (if fixed-term)
• Probationary period (if applicable)
• Salary/wage (amount and currency – critical in current crisis: specify USD vs. LBP, exchange rate if applicable)
• Working hours and days
• Leave entitlement
• Notice periods for termination
• End-of-service indemnity calculation basis
• Any other agreed terms and conditions

Language:

• Contracts can be in Arabic, French, or English
• Bilingual contracts common (Arabic-English or Arabic-French)
• Arabic version legally binding if dispute (Lebanon’s official language)

Registration:

• Employment contracts do not require registration with Ministry of Labour (though employer must register business and employees with NSSF)

Copies:

• Two copies: employer and employee

Types of Contracts

1. Contract for Indefinite Duration (عقد غير محدد المدة – Permanent Contract)

• Open-ended employment relationship
• No predetermined end date
• Standard for permanent employees
• Full protections and benefits

2. Contract for Definite Duration (عقد محدد المدة – Fixed-Term Contract)

• Defined end date or completion of specific project/work
• Can be used for:
  • Temporary increase in workload
  • Seasonal work
  • Replacement of absent employee (sick leave, maternity, etc.)
  • Project-based work with defined completion
  • Specific task or service
• Maximum duration: 1 year (can be renewed)
• Renewal: If renewed twice (total 3 contracts), or if total duration exceeds 2 years, deemed automatically converted to indefinite contract
• At expiry: Employment ends (end-of-service indemnity payable – see benefits section)

3. Part-Time Contract

• Less than standard full-time hours
• Pro-rata entitlements
• Same protections as full-time (proportional)

4. Seasonal/Temporary Work Contract

• For agricultural, tourism, or other seasonal activities
• Specific provisions

Probation Period (فترة التجربة – Trial Period)

• Maximum duration:
  • 3 months for general employees
• Can be shorter, never longer by statute
• Should be clearly stated in written employment contract before start
• During probation:
  • Full salary applies
  • Notice period: Either party can terminate with shorter notice (typically 1 week, or as specified in contract; some sources indicate immediate termination possible during probation with notice)
  • No end-of-service indemnity payable if terminated during probation
• After probation:
  • Automatic transition to confirmed employment
  • Standard notice periods and indemnity rights apply

An EOR ensures employment contracts are properly drafted, clearly specify currency provisions (critical in Lebanon’s crisis), comply with Labour Law, and protect both employer and employee interests.

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Working Hours in Lebanon

Working time in Lebanon is regulated by Labour Law.

Standard Working Hours

Statutory maximum:

• 48 hours per week (standard maximum)
• 8 hours per day (for 6-day work week)

Common practice:

• Monday-Friday work week (5 days) in many sectors (especially professional services, banking, tech)
  • 9:00 AM – 6:00 PM typical (with 1-hour lunch break)
• Monday-Saturday work week (6 days) still common in retail, some manufacturing, services
  • 8 hours/day × 6 days = 48 hours/week
• Saturday half-day: Some sectors (9:00 AM – 1:00 PM Saturday)

Ramadan:

• Muslim employees working hours often reduced during Ramadan month (though not strictly mandated by law, common practice)

Rest Periods and Breaks

Daily rest:

• Employees entitled to daily rest period (typically 1 hour lunch break, unpaid)

Weekly rest:

• Minimum 1 full day per week (24 hours)
• Sunday typically day of rest (Christian majority country, though Friday for Muslims in some sectors)

Overtime (العمل الإضافي – Additional Work)

Overtime = hours beyond 48 hours/week or 8 hours/day.

Overtime compensation:

• 50% additional (1.5× rate) for overtime hours on regular days
• Night work (after 9 PM): Additional premium (varies, often 50-100% additional)

Calculation:

• Hourly rate = Monthly salary ÷ (48 hours/week × 52 weeks ÷ 12 months) = Monthly salary ÷ 208 hours

Employee consent:

• Generally required for overtime (except emergencies)

Limits:

• No strict statutory maximum overtime hours specified in old Labour Law (but must be reasonable)

Sunday and Public Holiday Work

Sunday work:

• Sunday generally day of rest
• If required to work: Double pay (2× rate) or compensatory day off

Public holiday work:

• If employee must work on public holiday:
  • Double pay (2× rate) for hours worked, or
  • Compensatory day off + normal pay

Flexible Work Arrangements

Lebanon increasingly supports flexible work (especially tech, professional services):

• Remote work: Very common (especially post-crisis, infrastructure challenges make working from home attractive; many Lebanese tech workers remote for international clients)
• Flexible hours: Common in tech, startups, creative industries
• Freelancing: Significant freelance economy (working for international clients, receiving USD payments abroad)

Note: Given electricity shortages, internet reliability issues, remote work often means employees managing own infrastructure (generators, internet backups).

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Employee Leave in Lebanon

Lebanese Labour Law provides statutory leave entitlements (though dated framework).

Annual Leave (الإجازة السنوية – Paid Vacation)

Statutory minimum:

• 15 days per year after 1 year of continuous service
• Accrues after completing first year

Enhanced leave:

• Some employers (especially international companies, professional firms) provide 18-21+ days to be competitive and align with regional/international standards

Accrual:

• Once entitled, accrues proportionally

Scheduling:

• Employer and employee agree on timing
• Can be split by agreement

Carry-over:

• Unused leave can be carried forward (by agreement)
• Should be taken within reasonable period

Cash payment:

• Cannot be paid in lieu during employment (must take leave)
• Exception: Upon termination, all accrued unused leave paid out

Payment:

• Paid at normal salary rate

Public Holidays (الأعياد الرسمية – Official Holidays)

Lebanon observes approximately 15-17 public holidays annually (reflecting multi-confessional society):

National/secular holidays:

• New Year’s Day (1 January)
• Arab League Day (22 March) – sometimes observed
• Labour Day (1 May)
• Martyrs’ Day (6 May)
• Independence Day (22 November)

Christian holidays (reflecting Maronite, Orthodox, other Christian communities):

• Feast of St. Maroun (9 February – patron saint of Maronite Church)
• Good Friday (variable – March/April)
• Easter Sunday (variable)
• Easter Monday (variable)
• Assumption of Mary (15 August)
• All Saints’ Day (1 November)
• Christmas Day (25 December)

Islamic holidays (variable dates, lunar calendar):

• Eid al-Fitr (عيد الفطر – end of Ramadan) – 2-3 days
• Eid al-Adha (عيد الأضحى – Feast of Sacrifice) – 2-3 days
• Islamic New Year (1 Muharram)
• Mawlid al-Nabi (Prophet Muhammad’s Birthday)
• Ashura (10 Muharram – observed by Shia Muslims)

Note: Lebanon’s confessional system means both Christian and Muslim holidays observed as public holidays (unique in region).

Entitlements:

• Public holidays are paid days off (in addition to annual leave)
• If required to work: 2× rate or compensatory day off

Sick Leave (الإجازة المرضية)

Statutory sick leave:

Duration and payment:

• First 2 weeks (14 days) per year: Half pay (50% salary)
• Next 3 weeks (21 days) per year: No pay (unpaid sick leave but job protected)
• Total: Up to 35 days sick leave per year (14 days half pay + 21 days unpaid)

Medical certificates:

• Required from day 1 for sick leave exceeding 2 consecutive days
• From licensed physician
• Submitted to employer

Employer obligations:

• Pay sick leave as per statutory rates (50% for first 14 days)
• Cannot dismiss employee for legitimate illness (within statutory period)
• After prolonged incapacity, termination may be possible for health reasons (with medical evidence, proper procedure)

Note: Sick leave provisions relatively limited. Many employers (especially international companies, professional firms) provide more generous sick leave policies (full pay for longer periods) to compete for talent.

Maternity Leave (إجازة الأمومة – Maternity Leave)

Statutory maternity leave:

Duration:

• 10 weeks (70 days) total maternity leave
  • Typically divided: Some weeks before delivery, remaining after (employee’s choice within limits)
  • Must include minimum period after delivery

Eligibility:

• Female employees who have completed at least 1 year continuous service with same employer

Maternity pay:

• Full pay (100% salary) for entire 10 weeks
• Paid by employer (not social security/NSSF – employer bears full cost)

If less than 1 year service:

• Not entitled to paid maternity leave (though unpaid leave possible by agreement)

Job protection:

• Employer cannot dismiss pregnant employee or mother on maternity leave (except company closure or serious misconduct proven)
• Position must be held open
• Right to return to same job

Nursing breaks:

• After return from maternity leave:
  • Mother entitled to nursing breaks (typically 1 hour per day)
  • For period of breastfeeding (typically first year)
  • Paid time

Restrictions:

• Cannot require pregnant woman or nursing mother to work night shifts, heavy work, or hazardous conditions

Paternity Leave

No statutory paternity leave in Lebanese Labour Law.

Practice:

• Some employers (especially multinationals, tech companies) voluntarily provide 3-5 days paternity leave(company policy)
• Not mandated by law

Parental Leave

No specific statutory parental leave beyond maternity leave.

Other Leave

Compassionate/Bereavement Leave:

• Not explicitly statutory in Labour Law
• Common practice: 3-5 days paid leave for death of immediate family member (spouse, child, parent, sibling)

Marriage Leave:

• Not statutory
• Some employers provide 3-5 days for employee’s marriage (company policy)

Hajj Leave (Pilgrimage):

• Not statutory
• Some employers provide unpaid leave for Hajj (pilgrimage to Mecca) – once in employment

Unpaid Leave:

• By mutual agreement for personal reasons

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Employee Benefits in Lebanon

Mandatory Statutory Benefits

Important Context: Lebanon’s economic crisis dramatically impacts benefits, especially anything denominated in LBP. Salaries, benefits often negotiated in USD or USD-equivalent to protect against currency collapse.

1. National Social Security Fund (NSSF – الصندوق الوطني للضمان الاجتماعي) Contributions

NSSF provides social insurance (healthcare, maternity, work injury, end-of-service, family allowances).

NSSF Contribution Rates:

Total contributions: ~31.5% of gross salary (varies slightly by calculation method)

Breakdown:

• Employer contribution:
  • Healthcare (sickness/maternity): 8% of gross salary
  • Family allowances: 6% of gross salary
  • Work injury: 1.5% of gross salary
  • End-of-service indemnity: 8.5% of gross salary
  • Total employer: ~24% of gross salary
• Employee contribution:
  • Healthcare (sickness/maternity): 3% of gross salary
  • End-of-service indemnity: 2% of gross salary (in theory, though some sources indicate varying practices)
  • Total employee: ~5% of gross salary (note: some sources indicate 2-3% only in practice)

Note: NSSF contribution calculations have complexities, multiple funds/branches. Actual rates ~21-24% employer, ~2-5% employee, totaling ~23-29% depending on specific NSSF fund enrollment and calculation method. Verify current exact rates with NSSF or Lebanese accountant.

Calculation:

• Based on gross monthly salary
• Maximum contribution ceiling: Subject to caps (vary by NSSF fund – verify current ceilings)

Example (Monthly salary $2,000 USD-equivalent, approximate):

• Employer NSSF: $2,000 × ~24% = ~$480
• Employee NSSF: $2,000 × ~5% = ~$100
• Total NSSF: ~$580 (~29%)

What NSSF covers:

• Healthcare: Medical expenses (hospitalization, outpatient – subject to limits, reimbursement rates)
  • Note: NSSF healthcare system strained, reimbursement rates often inadequate; many employers provide private health insurance as key benefit
• Maternity benefits: Partial reimbursement of maternity costs (though employer pays full maternity leave salary)
• Work injury and occupational disease benefits
• Family allowances: Monthly allowances for children (though amounts eroded by inflation)
• End-of-service indemnity fund (accumulation toward end-of-service payment – see below)

Crisis Impact: NSSF system severely strained (services reduced, reimbursements delayed, currency crisis affecting real value). Private health insurance now essential benefit for attracting employees.

2. Income Tax (ضريبة الدخل – Personal Income Tax)

Lebanon uses progressive income tax system.

Personal Income Tax Rates (verify current as subject to changes given crisis):

Progressive brackets (approximate):

• First LBP 6 million/year: 2%
• Next LBP 9 million: 4%
• Next LBP 9 million: 7%
• Next LBP 9 million: 11%
• Next LBP 9 million: 15%
• Next LBP 18 million: 20%
• Above LBP 60 million: 25%

Note: Given currency collapse, these LBP thresholds now translate to very low USD equivalents (e.g., LBP 60 million = ~$667 at parallel rate). In practice, most salaries now paid in USD or USD-equivalent, and income tax calculations complex (official vs. parallel exchange rates, Ministry of Finance guidance evolving).

Tax-free threshold:

• Basic personal allowances, family allowances (subject to change)

Employer responsibilities:

• Calculate and withhold income tax monthly (though system strained, enforcement variable)
• Remit to Ministry of Finance (procedures evolving given crisis)

Crisis Note: Income tax collection, enforcement significantly impacted by crisis, banking restrictions. Verify current tax procedures with Lebanese tax advisor – situation fluid.

3. Minimum Wage (الحد الأدنى للأجور)

National Minimum Monthly Wage:

• LBP 9,000,000/month (increased 2024 to address inflation)
• However, at parallel exchange rate (90,000 LBP/USD), this = **$100 USD/month** (essentially meaningless given inflation)

In practice:

• Market salaries for skilled workers far exceed minimum (especially if paid in USD or USD-equivalent)
• Minimum wage enforcement limited given economic collapse

4. End-of-Service Indemnity (تعويض نهاية الخدمة – Severance/Gratuity)

Statutory end-of-service indemnity (major benefit in Lebanon):

Calculation:

• 1 month’s salary for each year of service (for first 5 years)
• 2 months’ salary for each year after 5 years (years 6+)

“Salary” = last monthly salary (basic salary + allowances typically)

When indemnity payable:

• Employer termination (any reason except proven serious misconduct)
• Mutual agreement
• Employee resignation (after certain conditions – typically 2 years service minimum, though varies)
• Retirement
• Death (paid to heirs)
• Fixed-term contract expiry

When indemnity reduced or not payable:

• Employee resignation with <2 years service: No indemnity (or partial, depending on circumstances and contract)
• Dismissal for serious misconduct (proven grave fault): No indemnity

Calculation example:

• Employee: 7 years service, final salary $3,000/month
• First 5 years: 5 × $3,000 = $15,000
• Next 2 years (years 6-7): 2 × 2 × $3,000 = $12,000
• Total indemnity: $27,000

Payment timing:

• Must be paid upon termination (with final salary)

NSSF End-of-Service Fund:

• Employer and employee contributions accumulate in NSSF end-of-service fund
• Upon termination, employee receives accumulated contributions + accrued interest
• This is in addition to (or may offset) employer’s direct indemnity obligation depending on calculation and practices

Crisis Impact: End-of-service indemnity critical issue in current crisis:

• If denominated in LBP, value evaporated
• Best practice: Specify end-of-service indemnity in USD or USD-equivalent in employment contract to protect both parties
• Banking restrictions make large indemnity payments challenging (capital controls, withdrawal limits)

Note: End-of-service indemnity is major liability for employers in Lebanon (generous formula: 1 month per year for 5 years, 2 months per year after). Employers should accrue provisions monthly for this obligation.

Employer Costs Summary

Total employer statutory costs on top of gross salary (approximate):

• Employer NSSF: ~21-24% of gross
• Total employer statutory cost: ~21-24% on top of gross
• Plus end-of-service indemnity accrual: ~8-12% annually (accrued over time, paid at termination)

Example (Employee gross $2,000/month):

• Employer NSSF: ~$480
• End-of-service accrual: ~$200/month (for eventual payment)
• Total: ~$680 (~34% including indemnity accrual)
• Total employer cost: ~$2,680

Employee deductions from gross:

• Employee NSSF: ~2-5% of gross
• Income Tax: Variable (progressive, situation complex given crisis)
• Total employee deductions: ~5-15% of gross (depending on income and tax calculation)

Net salary: ~85-95% of gross (if paid in USD or USD-equivalent; situation varies widely)

Common Additional Benefits Provided by Employers

Given Lebanon’s economic crisis and competition for talent (brain drain), employers offering USD-based compensation and strong benefits have significant advantage:

Critical Benefits (Almost Essential for Attracting Talent):

• USD or USD-equivalent salary (partial or full – essential given LBP collapse)
  • Known as “fresh money” (USD from abroad) vs. “lira” (LBP)
• Private health insurance (essential – NSSF healthcare inadequate)
  • Family coverage critical (public healthcare strained)
  • Providers: MedNet, NSSF Private, GlobeMed, others
• Transportation allowance (fuel shortages, high costs)
• Generator/electricity allowance (state electricity 6-12 hours/day; households/businesses rely on private generators – expensive)

Other Common Benefits:

• Performance bonuses (if company profitable)
• End-of-year bonus (13th month – less common now given crisis, but some employers maintain)
• Education allowances (for employees’ children – private schools expensive)
• Housing allowance or accommodation (especially for senior expatriates)
• Meals/lunch allowance
• Mobile phone or communication allowance
• Professional development (training, certifications – especially IT, language)
• Remote work equipment (laptop, internet backup, generator access)

Work Visa/Permits (for foreign employees):

• Employer sponsors work permits (mandatory)

An EOR ensures proper NSSF contributions, end-of-service indemnity accruals in appropriate currency (USD-equivalent), income tax withholding (navigating crisis-related complexities), and competitive benefits packages crucial for retaining talent in Lebanon’s challenging environment.

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Payroll & Tax in Lebanon

Payroll Currency

Critical Issue Given Currency Crisis:

• Official currency: Lebanese Pound (LBP)
• Reality: Most professional salaries now paid in USD or USD-equivalent (or split: part USD, part LBP)
• Employment contracts must clearly specify:
  • Currency of payment (USD, LBP, or split)
  • If LBP, exchange rate for conversion (official 1,507.5 LBP/USD meaningless; parallel market ~90,000+ LBP/USD as of 2024)
  • Payment method (bank transfer, cash USD if accessible, international transfer)

Payroll Cycle

• Monthly payroll standard
• Payment typically end of month or beginning of following month
• Payment method challenges:
  • Banking crisis: Capital controls, withdrawal limits, difficulty transferring funds
  • USD cash scarce: Physical USD limited
  • Common solutions: International bank transfers (if employee has foreign account), USD cash (if available), payment platforms accepting USD

Payslips:

• Should be provided (showing gross, deductions – NSSF, income tax if applicable, net)

Personal Income Tax

See detailed rates in Benefits section above.

Summary:

• Progressive rates (theoretically, though system strained)
• Crisis complication: LBP-denominated thresholds now meaningless in USD terms; tax calculations complex

Payroll Deductions Summary

From employee gross salary:

• Employee NSSF: ~2-5% (varies by fund enrollment)
• Income Tax: Variable (system strained, enforcement inconsistent)
• Total employee deductions: ~5-15% of gross

Net salary: ~85-95% of gross

Employer Payroll Responsibilities

Lebanese employers must:

Monthly obligations:

• Calculate and withhold Employee NSSF (~2-5%)
• Pay Employer NSSF (~21-24%)
• Calculate and withhold Income Tax (if applicable, system permitting)
• Remit NSSF to National Social Security Fund (deadlines vary – verify; historically by 15th of following month but system strained)
• Remit Income Tax to Ministry of Finance (procedures fluid given crisis)
• Accrue end-of-service indemnity provisions (critical liability)
• Issue payslips to employees

Annual obligations:

• File annual income tax returns (employer and employees, though system strained)
• Reconcile NSSF contributions (if possible given administrative challenges)
• Reconcile end-of-service indemnity accruals

Ongoing:

• Maintain payroll records
• Register employees with NSSF
• Register with tax authorities
• Navigate banking restrictions (capital controls, withdrawal limits for salary payments)

Challenges:

• Currency crisis: Paying salaries in USD or USD-equivalent amid banking restrictions
• NSSF system strained: Contribution collection, benefit provision impacted
• Tax administration disrupted: Ministry of Finance capacity limited, enforcement inconsistent
• Inflation: Constant adjustment needed for LBP-denominated amounts
• Banking sector collapse: Difficulty transferring funds, accessing accounts

An EOR manages payroll calculations, NSSF/tax remittances (navigating system challenges), handles currency/payment complexities, and maintains proper end-of-service indemnity accruals in appropriate currency (critical for protecting both employer and employee).

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Employment Laws & Compliance in Lebanon

Key Compliance Areas

1. Written Employment Contracts

• Strongly recommended (specify currency, end-of-service indemnity terms clearly)
• Copy to employee

2. Employment Equality and Non-Discrimination

Lebanese Labour Law prohibits discrimination (though enforcement limited).

Protected characteristics:

• Gender/sex
• Religion (in principle, though Lebanon’s confessional system creates complexities)
• Political opinion
• Nationality (in principle, though work permits restrict foreign employment)

Note: Lebanon’s confessional political system (power-sharing among religious communities) creates unique context for employment. Gender equality: Women’s workforce participation increasing but still lower than men; legal protections exist but cultural norms influential.

Equal pay:

• Equal pay for equal work mandated (though enforcement limited)

3. Ministry of Labour Compliance

• Directorate General of Labour (Ministry of Labour and Social Affairs) oversees employment
• Labour inspections (though capacity limited, especially given crisis)

Enforcement challenges:

• Limited inspectorate capacity
• Economic crisis reducing government administrative capacity
• Focus on larger employers, formal sector (many workers in informal economy)

4. NSSF and Tax Compliance

• Timely NSSF registration and contributions (though system strained)
• Income tax withholding and remittances (procedures evolving)
• Proper record-keeping

5. End-of-Service Indemnity

• Critical compliance area: Accurate calculation, proper accrual of provisions
• Currency specification essential: Indemnity in USD or USD-equivalent to protect both parties
• Payment upon termination (despite banking restrictions – plan ahead)

6. Working Time, Overtime, Rest

• 48-hour work week (or less)
• Overtime premium (1.5×)
• Weekly rest (1 day minimum)
• Annual leave (15 days minimum)

7. Occupational Safety and Health

Lebanon has basic OSH provisions (Labour Law, sector-specific regulations):

• Employers must provide safe working environment
• Risk assessments (especially construction, manufacturing, hazardous work)
• Safety training
• Accident reporting

Challenges:

• Limited enforcement capacity
• Infrastructure issues (electricity shortages, building safety post-Beirut explosion)

8. Data Protection

Lebanon does not have comprehensive GDPR-equivalent data protection law (as of current status).

Best practices:

• Handle employee data confidentially
• Secure storage, limited access

Termination & Notice Periods

Notice Period Requirements

Statutory minimum notice periods (Labour Law):

Employer-initiated termination:

• Varies by length of service and salary payment frequency:
  • Monthly paid employees: Typically 2 months notice
  • Other payment frequencies: Shorter notice (e.g., 1 month, 15 days)

Employee-initiated resignation:

• Similar notice requirements (typically 2 months for monthly paid, shorter for others)

Contractual notice:

• Employment contracts often specify notice periods (can be longer than statutory)

During notice:

• Employee continues working, receives full salary
• OR employer can release employee immediately (paying notice period salary – payment in lieu)

Example:

• Employee (indefinite contract, monthly paid) resigns: Must give 2 months notice (or employer can waive)
• Employer dismisses for redundancy: Must give 2 months notice + end-of-service indemnity

Grounds for Termination

Employer can terminate for:

1. Mutual Agreement (اتفاق متبادل):

• Both parties agree to end employment (terms negotiated, indemnity typically payable)

2. Expiry of Fixed-Term Contract:

• Contract ends on specified date (no notice required)
• End-of-service indemnity payable (for contract completion)

3. Redundancy/Economic Reasons:

• Position eliminated, business closure, restructuring, economic difficulties (very common given current crisis)
• Must follow procedures:
  • Notice period (2 months typical)
  • End-of-service indemnity: Full indemnity payable (1 month per year for 5 years, 2 months per year after)

4. Serious Misconduct (خطأ جسيم – Grave Fault):

• Gross misconduct allowing dismissal:
  • Theft, fraud, embezzlement
  • Violence, assault
  • Gross insubordination, serious breach of duties
  • Disclosure of employer’s secrets
  • Intoxication, drug use at work
  • Conviction of crime
  • Absence without permission for 7+ consecutive days
• Requires proof, employee given opportunity to respond
• No notice, no indemnity if proven serious misconduct

5. Poor Performance/Incompetence:

• After warnings, opportunity to improve
• Notice period required
• Indemnity payable

6. Medical Incapacity:

• Prolonged illness preventing work (after exhausting sick leave)
• Medical evidence
• Notice period
• Indemnity payable

Unlawful/Prohibited dismissals:

• Cannot dismiss:
  • Pregnant women, mothers on maternity leave (except company closure, proven serious misconduct)
  • For trade union activity, asserting labor rights (in principle)

Fair Procedures for Dismissal

Best practice:

For misconduct:

1. Investigation, documentation
2. Written notification of allegations
3. Hearing (employee response)
4. Decision based on evidence
5. Dismissal letter with reasons, effective date

For redundancy:

• Business justification
• Notice period
• Full indemnity payment (in appropriate currency – USD or USD-equivalent)

End-of-Service Indemnity

See detailed calculation in Benefits section above.

Summary:

• 1 month per year (first 5 years), 2 months per year (after 5 years)
• Based on final salary
• Payable on employer termination, mutual agreement, retirement, death, resignation (conditions), fixed-term expiry
• Critical: Specify in USD or USD-equivalent in contract

Dispute Resolution

If employment dispute arises:

1. Internal Resolution:

• Attempt to resolve with employer

2. Ministry of Labour:

• File complaint with Directorate General of Labour
• Mediation (though capacity limited given crisis)

3. Labour Arbitration Council (Majlis al-Tahkeem al-Emali):

• Specialized labour dispute body
• Hears cases, issues decisions

4. Court:

• Labour Court (first instance)
• Employee can claim:
  • Unfair dismissal (indemnity, compensation)
  • Unpaid wages, indemnity, leave
• Time limit: Varies (generally within reasonable period, often 1 year from termination)

Remedies:

• Reinstatement (rare in practice)
• Compensation:
  • Notice pay (if not given)
  • Full end-of-service indemnity (if not paid or improperly calculated)
  • Additional damages (if wrongful dismissal – typically several months’ salary)

Challenges:

• Court system slow (cases can take years)
• Enforcement of judgments difficult (especially collecting payments given banking crisis)
• Legal costs (though lawyer fees negotiable, often contingency)

Note: Many disputes now settling informally given court system challenges and economic crisis (both parties have interest in resolving without prolonged litigation).

Immigration and Work Permits

Lebanese citizens:

• Unlimited right to work in Lebanon

Foreign nationals (expatriates):

• Require work permit and residence permit to work legally in Lebanon

Work permit process:

1. Employer Sponsorship:

• Employer must sponsor foreign employee
• Cannot self-sponsor

2. Work Permit Application:

• Employer applies to Ministry of Labour (General Directorate of General Security) for work permit
• Provides:
  • Employment contract
  • Employee passport, qualifications, CV
  • Company registration documents
  • Justification for foreign hire (specialized skills, no suitable Lebanese candidate)
  • Ministry of Labour approval (demonstrating need for foreign worker)

3. Quota and Restrictions:

• Lebanon limits foreign workers (ratios of foreign to Lebanese employees vary by sector – typically aim for majority Lebanese)
• Certain positions reserved for Lebanese (e.g., many administrative, clerical roles)
• Sector-specific quotas (construction, services, etc.)

4. Work Permit Issuance:

• General Security (immigration authority) issues work permit (if approved)
• Duration: Typically 1 year, renewable annually

5. Residence Permit:

• Foreign worker obtains residence permit (إقامة – iqama) from General Security
• Linked to work permit
• Duration: Aligned with work permit (1 year typically)

6. Registration:

• Register with municipality (residence registration)

Processing Time: 1-3+ months (varies, can be lengthy, administrative capacity reduced by crisis)

Costs:

• Work permit fees: Several hundred USD
• Residence permit fees: Varies
• Employer typically covers

Renewal:

• Annual renewal (before expiry)
• Updated employment contract, company documents, fees

Dependents:

• Family members (spouse, children) can apply for residence permits
• Generally cannot work without separate work permits

Employer Obligations:

• Sponsor work permit for all foreign employees
• Ensure employees have valid permits before commencing work
• Cannot employ foreigners without valid authorization (penalties: fines, deportation of employee, closure)

Crisis Impact:

• Work permit processing slower (administrative capacity reduced)
• Some foreign workers leaving Lebanon (crisis, security concerns)
• Government revenue needs may make work permit renewals focus (fees in USD valuable)

An EOR with Lebanese entity sponsors work permits for expatriate employees, navigating General Security and Ministry of Labour procedures.