Israeli Labor/Employment Law
Israeli labor law provides a number of protections to workers in Israel. They are governed by the Basic Laws, the Hours of Work and Rest Law, as well as various other laws, statutes, and regulations.
Labor law is considered a unique area of the Israeli legal system. All issues that concern the relationship between workers and employers under the labor laws in Israel are subject to the jurisdiction of the labor law courts, which are separate from the Israeli civil and administrative court system.
Labor Law Courts in Israel
The labor court system is composed of regional courts around Israel, located in Tel Aviv, Jerusalem, Beer Sheva, and Nazareth. The regional labor law courts are authorized to hear cases according to the geographical area. The National Labor Court in Jerusalem has the authority to hear appeals against the decision of the regional labor law courts, as well as certain cases which include general issues of collective work agreements, workers’ unions, and employers’ organizations. The labor law court’s decisions may have an influence on the Israeli economy and Israeli labor law as a whole.
Labor Law Lawyers
Israeli labor law is composed of a complex combination of rules, regulations, rulings, and precedents of labor law courts, especially rulings of the Israeli National Labor Court. When seeking legal advice concerning labor issues, it is important to consult a lawyer who specifically specializes in labor law.
We represent workers and employers in all issues of labor law in Israel: drafting employment contracts, employment conditions, severance payments, payment for overtime, etc. we represent clients in the Israeli labor courts all over Israel as well as the National Labor Court in Jerusalem.
If you are a worker who seeks advice and legal consultation regarding workers’ rights or an employer who wants assistance in drafting contracts or representation in the labor law courts, we will be glad to assist you. Feel free to contact us for legal advice from an Israeli labor law lawyer.
Organizations in Charge of Labor Law Enforcement in Israel:
- The department of industry and commerce – under its jurisdiction are several institutions that coordinate matter of work relations and their enforcement.
- Labor court – this is the institution that passes judgment regarding employment matters, conflicts, employer employee relations, equal opportunity etc. The court is an independent institution and within its authority is to interpret the law, reconcile and dictate norms as regarding labor issues in Israel.
- The work relations unit (under the Ministry of Economy) – the unit is responsible to provide the public with information concerning labor laws, collective agreement approvals and extension orders. Likewise, the unit acts as a mediator for conflicts.
Labor Agreements in Israel:
Within 30 days of employment, the employer must deliver a written contract that fully specifies the entire employment conditions.
Minimum Wage for Employees in Israel:
There is a standardized minimum wage In Israel which is set at 5300 NIS per month for a full-time job – 186 monthly hours (28.4 NIS per hour).
The employee may not waver their right to minimum wage.
Specific to the construction sector, the law defines a full-time job as only 176 hours per month.
Time of Salary Payment in Israel:
The employer is obligated to pay his employee a monthly salary in the scope of the same working month and no later than the 9th of the following month.
Work Hours in Israel:
In Israel, there is a work and rest hour law which regulates and limits the number of hours allowed per day and per week. It also provides instructions regarding a rest day and legal breaks.
A standard workday is between 8 and 9 hours according to the number of workdays per week (5 or 6 days respectively).
On Friday the workday is 7 hours long.
For an employee that works 5 days a week, a workday lasts 8 hours and 36 minutes.
For an employee that works 6 days a week, a workday lasts 8 hours.
The employer is obligated to keep a record for his employees, consisting of work hours and overtime.
Overtime in Israel:
An employee who works 5 days a week may work 3.4 extra hours per day (total of 12 hours per day), but no more than 15 extra hours per week.
An employee who works 6 days a week may work 4 extra hours per day (total of 12 hours per day), but no more than 15 extra hours per week.
For the first 2 extra hours of everyday, a payment of 125% is received, for any hours beyond that, a payment of 150% is received.
It is not allowed to deduct overtime hours in exchange for regular missed hours.
Nighttime Work in Israel
A shift which contains at least 2 hours between 10pm and 6am is considered a night shift. The implication of a night shift is that the counting of extra hours begins in the seventh hour.
Weekly Rest Hours in Israel
Between two working days there must be a gap of at least 8 hours.
At least 36 consecutive hours of rest must be granted once a week. They can be granted on Friday, Saturday or Sunday according to the employee’s religion (Jewish employees have no choice and the rest day will always be Saturday).
It is prohibited to operate workshops, factories and stores on the day of rest (Saturday), and to employ Jewish workers on that day.
Employment on a Rest Day in Israel
Employees who are compelled to work on their rest day or on public holidays are entitled to 150% pay for every hour of that day. For extra hours the payment will be 175% (first two extra hours) or 200% (third extra hour onwards).
Legal Breaks in Israel
A manual laborer is entitled to a 45 minute break in a workday that exceeds 6 hours. At least 30 of those minutes need to be consecutive. During the legal break the employee is entitled to leave the work premises.
Breaktime is not calculated as part of the work hours and the employer is not obligated to pay for it.
The employer will be obligated to pay for breaktime only if he ordered that the employee stay on the premises during the break.
The employee is allowed to pray during the workday in accordance with his religion and the work requirements.
Annual Leave and Sick Leave
Employees are entitled to paid annual leave according to their seniority.
A 5 day workweek entitles the employee to 11 days a year (0.91 days per month)
A 6 day workweek entitles the employee to 13 days a year (1.08 days per month)
The number of days increases every year in correspondence with the number of years employed at the same workplace.
Payment for annual leave days will be calculated according to the average daily pay the employee received in the 3 months prior to the leave.
Employees in Israel are entitled to 18 days of sick leave per year. An employee will receive pay from the second day of absence and onward.
First day of absence – no pay (and a sick leave day is deducted), second and third days – 50% pay, fourth day onwards – full pay.
Travel Expenses in Israel
The employer is obligated to participate in travel expenses to and from work (or provide his own transport).
The payment will be up to 22.6 NIS per day or according to the price of a multiple entry ticket/monthly pass (the cheaper one).
The employer may choose to pay more but he is not obligated to do so.
Pension Insurance in Israel
Every employer must allocate funds towards the employee’s pension insurance.
If the employee does not have a pension fund, the allocation starts after six months.
If the employee has a pension fund from a previous employer, the allocation starts after three months (and he is retroactively compensated).
The allocation is 18% of the salary. 5.75% is payed by the employee and the remainder is paid by the employer.
Social (National) Insurance and Health Fees
Non-reporting or evading payment of insurance fees and taxes on time, will evoke charges and fines to the employer’s account plus interest according to the law.
The employer is liable for these payments on behalf of his employees.
Convalescence Pay in Israel
Every employee employed for over a year is entitled to convalescence pay. The amount depends on seniority. The amount can be paid yearly, monthly or by funding getaways.
Public Holidays in Israel
There are several public holidays in Israel:
Jewish new year (2 days), Yom Kippur (1 day), Sukkot (1 day), Simchat Torah (1 day), Passover (2 day), Independance Day (1 day), Shavuot (1 day).
These are rest days identical to Sabbath (Saturday) and the rules for payment on rest days apply.
Employees are entitled to holiday allowance/gifts after completing 3 working months.
The workday on the eve of a holiday will be 7 hours long.
Severance Packages in Israel
An employee who resigned, was laid off, or whose boss passed away, may be entitled to a severance package with the termination of their contract.
The employer must allocate monthly amounts into the employee’s pension insurance, for severance package purposes.
The employer must allocate 6% of the salary as a compensation component according to the extension order. The employer may add an extra 2.33% in order to achieve the full severance amount of 8.33%
Termination of Employees in Israel
Employers who wish to terminate employees or employees who wish to resign are obligated to provide prior notice in writing.
The employment contract is terminated as the notice period expires.
The required notice period is determined according to seniority.
Discrimination
Discrimination over race, religion, age, sexual preference, or disability is banned. It is also illegal to fire a pregnant employee unless the employer can satisfy the Ministry of Labor that the reasons for termination are unrelated to the pregnancy. Employers other than government security bodies and those providing services to children or the mentally or physically disabled are prohibited by law from conducting criminal background checks of job candidates.
Unlawful Dismissal
Unlawful dismissal or unfair dismissal are terms that describe a case in which an employee is dismissed in an improper manner, for many reasons.
Unlawful dismissals can be those made due to prohibited discrimination – for example, dismissal of an employee due to his advanced age – or dismissals made without a proper hearing procedure or without a hearing procedure at all. Sometimes an employee is fired for extraneous and forbidden reasons – for example, due to the fact that the employee stood up for his rights to pay social benefits, or in the case that he tried to organize a workers’ committee at the workplace. Or for example due to the fact that the employee went on sick leave, or refused to perform an illegal action required by the employer.
In many cases, the illegal dismissal will be accompanied by a hearing procedure that is expected to be proper. The employee is invited to a hearing procedure with reasons and reasons that are not the real reasons. The employee will have to prove that under the so-called proper dismissal procedure, there are other, illegal reasons hidden in order to win the lawsuit.
Unlawful Dismissal of an Employee with a Short Tenure
** You should know: not in every case that an employee is fired with an improper hearing procedure is it economically viable to file a lawsuit. Usually, when it comes to an employee who works for a short period of time of up to a year or two, the compensation awarded due to unlawful dismissal is low compensation, and sometimes no compensation is awarded at all. For example, when an employee is fired after a trial period of several months – in many cases the labor court will not award monetary compensation in his favor, and the more compensation is awarded it will be relatively low. In many cases people learn from information they read on various websites that because they were fired, they can be entitled to compensation of 12 salaries. This is not true!
In the event that it is a dismissal without a hearing at all, an employee who has worked for a short period of up to a year or two, has the option of using a lawyer for the purpose of filing a claim with the Labor Court . The claim and training for the management of the claim can be done with the lawyer at a low cost, and the claim, which is relatively uncomplicated, can be managed in the labor court. In any case of unlawful dismissal, you should consult with a labor lawyer in order to consider filing a financial claim against the employer.
Dismissal Without a Hearing
When an employer fires an employee without a hearing procedure – this is illegal dismissal. In such a case, the employee may submit a claim to the labor court for financial compensation.
A hearing procedure should begin with the delivery of a summons for a written hearing. In the summons for the hearing, the employer must list the reasons why he is considering firing the employee. In the hearing call, the employer must keep a protocol. The employee may record the hearing without the employer’s knowledge.
Injunction Against Dismissal
In serious and unusual cases, such as the dismissal of a very old employee, a dismissal close to retirement age, the dismissal of an employee who exposed corruption in a public company, or the dismissal of a pregnant employee – there is even reason to consider filing a request for a temporary restraining order in the Labor Court to prevent the employee’s dismissal . The meaning of the term “temporary” is that the order is given temporarily and urgently until the end of the legal process which may last a year or two, and at the end may become permanent.
A request for a restraining order must be submitted with the help of an experienced lawyer, as quickly as possible. A delay of even a few weeks may be considered a considerable delay, for which alone the application will be rejected. Therefore, in the event of a layoff, you should contact a lawyer immediately and without delay. In fact, it is very useful to get advice on labor law as soon as the invitation to the hearing is delivered, in order to be prepared with the right advice, before the dismissal takes effect.
Various Cases of Illegal Dismissal
In the case that came to our office, it turned out that an employee who worked for over 35 years in a large company was fired without any proper reasoning. The hearing was improper and did not specify any reason for the dismissal. The employee was fired very close to retirement age. Under the circumstances of the case, compensation was awarded in favor of the employee in a total amount of approximately 200,000 NIS.
In some cases, the claim for compensation for unlawful dismissal is accompanied by additional claim elements, such as social rights that have not been paid to the employee. In the case that came to our office, an employee who worked for only two years in the company, won a lawsuit for various social rights, as well as compensation in the amount of NIS 25,000 for unlawful dismissal.
Unlawful Dismissal - Legal Situation
According to the ruling of the labor courts, the obligation to conduct a hearing before making a decision on the dismissal of an employee is a fundamental right of the employee arising from the rules of natural justice, the duty of good faith and fairness in labor relations.
This right was already expressed in the 1950s in the High Court 3/58 Berman v. Minister of the Interior, where it was determined:
“…According to the rule adopted in common law for hundreds of years, an administrative body – and even a purely administrative one – will not be allowed to harm a citizen by bodily harm, property, profession, status, etc., unless the victim is given a fair opportunity to voice his defense against the future harm.”
The rule was implemented by the National Labor Court, which ruled in a long series of rulings that dismissals made without a hearing procedure or without a proper hearing procedure, are against the rules of natural justice and therefore are not lawful dismissals
In the ruling in the case (national) 1027/01 Dr. Yossi Guterman v. Emek Jezreel Academic College, it was determined as follows:
And so, it is settled law, from time immemorial, that the right to argument is one of the primary fundamental rights in our legal system, and a place of honor is reserved for it in labor relations in general, especially when considering the possibility of terminating an employee’s employment, either by way of dismissal or by way of non-renewal Contract of employment”.
The right to a hearing, which used to be the property of employees in the public sector only, has become the right of all employees in the State of Israel in recent years: in the case of Dani Malka v. Shufersal, the National Labor Court ruled that there is an obligation to conduct a hearing in the private sector as well, so That the right of hearing applies to the same scope and to the same extent in a public body, in a private body and in a body that is of two essences.
Dismissals without giving the employee the right to a hearing can lead to the nullification of the dismissal and return to work or financial compensation.
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