Israel’s Workday & Working Hours

Hebrew:  שעות עבודה בישראל

The Israel Labor Law

The  Israel Labor Law provides for a 43 hour work week.  This can be divided up into 2 categories:

1. A 5 day work week – workers who work 5 days a week, work 9 hours per day.
2. A 6 day work week – workers who work 6 days a week, work 8 hours per day.

It should be noted that some work agreements stipulate a 45 hour work week.

Actual Working Hours

Some factories operate from 7:00 a.m. until 9:00 p.m. – broken down into shifts

These days most offices start work anywhere between 7:30 a.m. and 8:30 a.m.

Mostly shopping centers open their doors at 10:00 am and are open all day until 9:00 or 10:00 p.m. – broken down into shifts.

Some small, privately owned shops and establishments (not in malls) close between 2:00 p.m. and 4:00 p.m.  They then remain open until 7:00 p.m.

Banks have their own hours, all work in the morning.  You may be required to work afternoon shifts as well.

If you are in the public sector, you could finish as early as 3:00 p.m. or 4:00 p.m.

Emergency services; hospitals, fire, police and ambulance services work 24/7 broken down into shifts.

The building trade: on-site laborers generally work from 7:00 a.m. to 3:00 p.m.

Self-employed tradesmen can choose their own hours, but are generally available between 7:00 a.m. and 7:00 p.m.

Real flexi-time is not common in Israel however your employer may be slightly flexible with your starting and ending times.

Many hi-tech industries dealing with the American of Eastern markets require their employees to start work later in the day – around 11:00 a.m.  Companies dealing with forex and financial markets often require their employees to work shifts which may start at 8:00 a.m. and end as late as midnight.

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Lunch & Tea Breaks

According to the law an employee is entitled to a 45 minute break during a work day of at least 6 hours.  Your employee may break this down into a 10 minute morning coffee break, a 25 minute lunch break and another 10 minute afternoon coffee break.  Bear in mind that in some industries competition is rife and employees may choose to work through their lunch break.  Before you sign your employment contract you need to clarify your working hours.

Clocking your Working Hours

Your employee may require you to clock-in and clock-out every day.  You may be lucky and your employee may offer a small monthly bonus for adhering to strict working hours.  This is not common however.

If you do not have a clock-in, clock-out system, be sure to keep an accurate time sheet of regular and overtime hours worked

Overtime Hours

Overtime hours are dealt with in detail here

Keren hishtalmut – A tax-free savings plan

Hebrew: קרן השתלמות

What is a Keren Hishtalmut?

A Keren Hishtalmut is a short term tax free saving plan available in Israel.

How does it work?

Both employer and employee contribute to the savings plan. The fund accumulates for 6 years.  At the end of the 6th year you are able to withdraw the money from the fund without paying Capital Gains Tax.  If you make a withdrawal prior to the end of 6th year, you are liable for tax penalties.

Do I qualify for a Keren Hishtalmut?

1. The Keren Hishtalmut was originally made available for government employees, academics, teachers etc., who are likely to take a sabbatical year.  So you contribute for 6 years and withdraw for use in the 7th or Sabbatical year.
2. Regular salaried employees, depending on the terms of their employment contract, may also contribute to this savings plan.  The employer also makes a contribution.  For the employer, his portion/contribution is tax deductible.
3. An employee who have a significant financial interest in the company is can also have a Keren Hishtalmut.  Rules, regulations and tax benefits for this type of employee differ slightly to those for regular salaried employees.
4. Business Owners – Self Employed: A self-employed – Atzmai – in Israel can also have a Keren Hishtalmut which affords them certain tax benefits.

Our Tip

Their are various contribution levels depending on your status – take the advice of a tax consultant, accountant or investment advisor before you sign up for a Keren Hishtalmut.

Employment Resources to help you land that perfect job

Understanding your salary slip – the pay stub

Congratulations!  You’ve aced the job interview and now, after a long job search, you are finally starting to work in Israel.

There is still a lot to learn in the future; there is form 101 which needs to be filled in on your first day, overtime hours in Israel, maternity benefits, sick leave, unemployment etc.  But for now you are on the payroll and anxiously awaiting your first paycheck.  According to Israeli labor laws, your employer has up until the 10th of the month to pay you. 

Finally payday arrives and you are presented with a Hebrew salary slip or ‘tlush maskoret’ – תלוש משכורת.

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What information is included in the salary statement?

While there is no one standard format for your salary statement, according to law however, every statement needs to include the following information:

Your basic information; full name, identity number (teudat zehut), marital status, details of your bank account, if you are a full-time or part-time worker and your salary level.

Employer’s details; employer name and address, their tax registration number and their Bituach Leumi (National Insurance) file number.

Salary information; your base salary (bruto), all allowances and deductions and your net salary (netto)

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Must I keep my pay slip?

Yes, your pay slip is a very important document and you need to file and keep it even though your employer has it on record.

Your pay slip is proof of your income and there are certain situations where you may need to reference the slip:-

• In case of dispute
• To get unemployment benefits
• You may also be asked to prove your salary when applying for certain reductions like school fees.

At the end of the year, which is also the end of the financial year in Israel, your employer will issue the Tax Form 106.  Form 106 is a summary document reflecting your total salary for the current fiscal year as well as all income tax and National Insurance deductions (bituach leumi).

You must keep Tax Form 106 – you will need it when applying for tax refunds or reductions.

Hebrew English  Salary Stub Translation

To make your Aliyah easier, we have translated a typical salary slip from Hebrew to English.

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You Monthly Pay Package: Salaries & Wages

Hebrew:  משכורת חודשי (Maskoret Hodshi)

Before you sign an employment contract, there are a few things you need to know about salaries in Israel.

Israel’s equal wage law

The Equal Opportunity Employment Law in Israel, among other things, ensures that both men and women receive equal remuneration for equal work.

Hourly, weekly or monthly salary

Mostly, Israeli workers receive a monthly salary although some workers can be paid on a daily or hourly basis.

How is my salary made up?

Your salary is made up of a few parts;

1. Your gross wage – “bruto” – as stipulated in your contract of work. 
2. Benefits; car and other allowance, savings plans etc.
3. Deductions
4. Your final net wage or take-home pay -“netto” – is determined after all benefits have been calculated and deductions have been made.

Compulsory deductions

Your employer is obligated by law to make certain deductions and you are obligated by law to make these payments.  These include your personal income tax (misim), bituach leumi (national insurance) and your health insurance premium.  Any other deductions like savings plans must be stipulated in your work contract.

• Click here for a Hebrew English translation of a typical pay slip…
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Salary Negotiation

It is common practice in Israel to negotiate your salary.  You do not have to accept the first offer that is made to you even if you are a new immigrant and a little desperate.  Familiarize yourself with the going rates in your professional field – ask your friends, check out average salary charts.  If this is your first job in Israel, you may need to accept a slightly lower wage in the beginning but this should be reviewed at the end of your trial period (generally after 3 months).

When will I get paid?

Your employer can pay your salary until and no later than the 10th of each month.

If for some reason your salary is overdue, you are entitled to a 5% compensation for the first week and a 10% compensation for each following week.

How will I get paid?

Your salary can be paid directly into your bank account or your employer may choose to pay you by check – this is highly unlikely in these days of digital banking.  The method of payment should be determined prior to employment and stipulated in your contract.

Your pay slip – tlush maskoret

The law states that every employee received a printed pay slip.  All deductions, benefits, taxes, bonuses etc., must be recorded on the pay slip.

Keep all your pay slips.  You will need them in case of disputes, when applying for unemployment (avtala) benefits, bank loan applications and other discounts according to your circumstances.

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You employment contract for the Israel labor market.

Is there a standard employment contract in Israel?

The answer is no.  No standard employment contract exists in Israel.  There are specific labor laws and worker’s rights that every employee is entitled to which include:

• The right to a minimum wage
• The right to timely payment
• The right to a labor agreement
• The tight to recuperation /rehabilitation  – Dmei Havraa
• The right to overtime hours
• The right to annual leave and vacation days
• The right to a travel allowance and reimbursement

Written agreement vs a verbal agreement

While both a written and verbal agreement are legally binding, it is often difficult to prove a breach of contract or win a labor dispute if there is nothing written down.

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What should be included in the work contract?

• A clear job description
• The date of commencement
• Date of completion in the case of a temporary job or one with a specified time limit.
• Notice period.  This can be as little as two weeks, often it is one month but it can also be more than that.
• Salary
• Additional benefits
• Trial period; usually 3 months
• Salary reviews
• Working hours
• Overtime expectations
• Lunch breaks
• Holidays and vacation days
• Any other points that might be relevant to your job and level of seniority.

An English or Hebrew Contract?

Unless your employer has an English contract, your contract of work will be written in Hebrew.  It is up to you to ask a friend or labor expert to check the contract.

Secrecy Agreement

In certain industries employees may be asked to sign a secrecy agreement as well.  The secrecy agreement may restrict you from getting a job in a similar field at a later date.  The agreement may also include a clause that restricts you from starting your own business in a similar field.  Check this carefully as it can limit your options in the future.

Signing the Contract

Your employment contract should be signed within 30 days of commencing your new job.