Work disability insurance אובדן כושר עבודה

Loss of work ability is a serious problem and usually results in a sudden and drastic loss of income as well. All salaried employees in israel are protected against a loss of work ability situation by The national social security (Bituach Leumi). In order to receive a stipend a form needs to be filled out and submitted. The form needs to include the employee’s salary information and payroll information for the months preceeding the loss of work ability, as well as the employer’s signature confirming the salary information. Employee’s with pension plans, these usually have loss of work ability insurance built in to the policy. This will usually cover 70% of the employee’s gross pay. Bituach Leumi and pension plan for loss of work ability payments offset each other. An employee can purchase additional coverage so that it will not offset at additional cost. Speak to your pension plan company for more details.

The criteria for payment of loss of work ability insurance are the following:
1. 75% or more of loss of work ability. Approved by employment doctor for as long as this condition continues or the policy ends, which ever comes first. There usually is a waiting period when an employee joins a pension plan until they can file. If the loss of work ability occurs before then, the employee will only receive payment after the waiting period is over.
2. Complete coverage in case of acts of terror.
3. During the period of payment for loss of work ability, the employee is exempt from contributions to the pension plan.

Are work contracts mandatory ?

All employers are required to issue either a work contract or an “employer’s notice of employment terms and conditions” to all employees within 30 days of starting employment. If the employees are youth (under 18) this must be done within 7 days of starting employment. Any change in the employment terms and conditions must also be issued to an employee within 30 days of the change (7 days for employees under age 18).

The only changes that do not require notification to the employee are:
1) Changes due to laws, comprehensive ordinances, collective agreements.
2) Update in salary listed in original contract or employer notification (although it is recommended).
3) A change that is itemized on the payslip.

The regulations state that for an employer to be considered as complying with this regulation the following information must be included in either the work contract or the notification:
1. Employer’s name
2. Employer’s address
3. Employee’s name
4. Employee’s address
5. Employee’s job title and discription of main duties and responsibilities
6. Full name and job title of employee’s direct supervisor
7. Address / location where employee is to be employed
8. Employee’s work days and hours and length of work day
9. Employee’s weekly rest day
10. Employee’s salary and any other payments he/she is entitled to
11. All social benefits employee is entitled to, their % or amounts
12. Employee’s start date, and duration of contract (if applicable)

The notification needs to be signed by the employer. In cases of foreign workers, it needs to be in the foreign worker’s native tongue or a language that they fully understand and be signed by both the employer and the employee.
Failure to comply may result in any or all of the following scenarios:
1) lawsuit in labor court by the employer – there is a specified amount that can be claimed for failure of the employer to comply which can be awarded by the court without need to prove any monetary damage.

There are three separate forms for employer notification to employees:
1. Employer’s notification form of details & terms of employment.
2. Employer’s notification form of contributions towards social benefits (pension, study fund, etc)
3. Employer’s notification form of change in terms of employment (any of the above information that changes require this notification)

All 3 forms are available for download on the Ministry of Economics website: Working Conditions Notification Forms

Employee’s Rights Handbook

The “Employee’s Rights Handbook”

The first comprehensive, English language guide to Israeli payroll.
Whether  you are an employer or an employee, a new oleh or an English speaker who has trouble with the Hebrew terms, this publication is for you!

 

Employees:

Understand the terminology, layout and the Hebrew terms on your payslip

Know your rights

Understand the labor laws

What mandatory things need to be itemized on the payslip?

What are the things you need to know upon termination?

How many vacation days are you entitled to?

Is Purim a paid holiday?

What are the rights of a pregnant employee?

 

Employers:

Do your payslips comply with all the new regulations?

Do you issue employees “notification of terms of employment” as required?

Are employees given a fair hearing prior to termination?

Understand what obligatory payments exist in Israel

What is allowed to be deducted from an employee’s salary?

Is an employee who is on maternity leave allowed to work from home?

Must I pay travel expenses to all employees?

What can and cannot be deducted from an employer’s salary?

Are you aware of penalties for infringement on regulations and labor laws? (avoid this by knowing what needs to be done)

 

In this guide you will find:
* An overview of labor laws, regulations, expanded regulation orders, collective
agreements and statutes

* The make-up of the Israeli payslip

* Social Security

* Health Insurance
* Income tax

* Holiday pay, sick day payment, vacation, overtime payment, bereavement leave,
maternity leave

* Minimum wage

* Youth employment
* Advance notice

  • Tips             And much more!

 

A must for employers and employees alike. Get your copy today! This 107 page publication in hard-copy is not available in stores OR Anywhere else, get your copy today !

Price: 100 sh

For orders please go to: Order Here and fill out your details. You will receive an E-invoice for payment after which your book will be mailed to you. Self pickup is available in Jerusalem: Please state if you are interested in this option.Employee's Rights Handbook

Announcing “Employee’s Rights Handbook” book launch and lectures

Book launch and lecture will be held:

In Jerusalem: on May 19th, 2015  19:00  at AACI Jerusalem, The Glassman family center Pierre Keonig st. corner of 2 Poalei Tzedek st., 4th floor (opposite Hadar mall)

In Tel-Aviv: on June 17th, 2015 16:00 at AACI Tel-Aviv, 94 A Allenby st.

 

The “Employee’s Rights Handbook”

The first comprehensive, English language guide to Israeli payroll.
Whether  you are an employer or an employee, a new oleh or an English speaker who has trouble with the Hebrew terms, this publication is for you!

 

Employees:

Understand the terminology, layout and Hebrew on your payslip

Know your rights

Understand the labor laws

What needs to be itemized on the payslip?

What are the things you need to know upon termination?

How many vacation days are you entitled to?

Is Purim a paid holiday?

What are the rights of a pregnant employee?

 

Employers:

Do your payslips comply with all the new regulations?

Do you issue employees “notification of terms of employment” as required?

Are employees given a fair hearing prior to termination?

Understand what obligatory payments exist in Israel

What is allowed to be deducted from an employee’s salary

Are you aware of penalties for infringement on regulations and labor laws? (avoid this by knowing what needs to be done)

 

In this guide you will find:
* An overview of labor laws, regulations, expanded regulation orders, collective
agreements and statutes

* The make-up of the Israeli payslip

* Social Security

* Health Insurance
* Income tax

* Holiday pay, sick day payment, vacation, overtime payment, bereavement leave,
maternity leave

* Minimum wage

* Youth employment
* Advance notice                       And much more!

 

A must for employers and employees alike. Get your copy today! This 107 page publication in hard-copy is not available in stores, on-line orders:

 

http://www.israpay.com/announcing-the-release-date-for-employees-rights-handbook/

Announcing the release date for Employee’s Rights Handbook !!!!

Finally, the long awaited Employee’s Rights Book is to be released in Hard copy. The release date is Sunday March 15, 2015

At present, this is the only format. There may be a PDF purchase option at a later date.

The book is 107 pages of vital information for employers, employees and anyone interested in Employee’s rights, labor laws and the makeup of payroll in Israel.

Announcing the first and only English language guide in simple easy to understand language !!!

The Book also contains a dictionary of common Hebrew payroll terms and their English translation, examples of payroll forms, useful contact information, tips and more.

Get your copy today,  and know your rights !

price: 100 sh (including mailing). Optional self-pickup in Jerusalem (85 sh).
Payment via credit card or paypal, use this link:

<a href=”http://www.vcita.com/v/israpay/make_payment?pay_for=Employee’s%20Rights%20Handbook&amount=100″ target=”blank”>pay</a>

or follow the schedule an appointment on the left hand side of the home page of this site.
If you encounter a scheduling error notice, send the following details:
(Name, mailing address, email address, phone/cell number. If you wish that the invoice be made out to a different name than the one you supplied, please state)
to moshe.israpay@gmail.com and An invoice will be emailed to you. When you open the invoice you will have the ability to pay.

Check payments option:  send a check made payable to Moshe Egel-Tal along with the above info to

Israpay
P.O. Box 44429
Jerusalem 9144302

 

 

 

 

New Havra’a rates for 2014

The new rates for convalescence pay (dmei havra’a) have been updated as of July 2014 as follows:

Private sector = 378 sh per day

Public sector – 427 sh per day

Payment is mandatory for all employees with min 1 year tenure with the present employee.

The number of days an employee is entitled to depends on the sector and the number of years of tenure they have incurred.

 

Pension plan contributions for salaried sales employees

If you are an employer of salaried employees who work on a base pay with sales commissions or if you are an employee who works in a sales commission job, this is for you:

Joe worked as a sales rep for a company for several years. He resigned his position and sued his employer for payments towards mandatory pension, that were done only from his base pay, without taking into account the sums he earned from sales commissions.

In a recent verdict in labor court (11.2013), the court recognized the fact that sales commissions are a major component of  salary, and as such, they are to be taken into account for pension purposes, as well as severance pay!
This despite the fact that sales commissions are not a set rate or fee, but rather they change monthly, based on the employee’s performance and actual sales. 

 

 

So, what exactly is a “keren hishtalmut” ?

Keren Hishtalmut

Roughly translated, a keren hishtalmut is an advanced study fund. This is in actuality a savings plan. In the past it used to be a dedicated savings plan, meaning that the funds could only be used for enhanced studies. Today, it can be used for any purpose.

In recent years, the monetary market has undergone revisions and changes, and at present keren hishtalmut is the only medium length savings plan, that the earned interest is still tax exempt (provided of course that the deposits are within the ceiling published by the Tax Authority)

What are the % of contributions towards keren hishtalmut ?

For salaried employees, The employee’s contribution is deducted directly from the gross pay via the paylsip.

Employee contributions are usually 2.5%  and employer’s contributions are 7.5%.

For self-employed, the contribution is 7% (up to 17,040 sh annually)

 

How much can I deposit into a keren hishtalmut ?

The annual ceiling from which contributions can be made is currently 188,544 sh (or 15,712 sh per month). Contributions from higher amounts result in taxation on the portion over the ceiling.

 

How long is the keren hishtalmut plan ?

Keren Hishtalmut savings plans are  a six-year plan. The accumulated sums in the fund can be used after 4 years tenure towards advanced studies. They cannot be used towards a university degree, but rather on enhancement courses, regardless of the subject.

At the end of 6 years tenure, all the accumulated sums can be withdrawn and be used for any purpose, However they do not have to be withdrawn and remain available for immediate withdrawl upon request, while at the same time continue to gain interest.

Since this type of savings plan is very attractive, it would be wise not to withdraw the money after 6 years, if you do not need to.

 

Is keren hishtalmut mandatory ?

No, it is not. The labor laws do not mention it at all.
In the public sector (Government, Municipalities, etc) it is mandatory due to existing work agreements and custom procedure in the place of employment.
In the private sector, it is a nice perk that you may be able to get instead of a higher salary via contract negotiations.
Some places of employment will give keren hishtalmut after certain tenure has been reached.

Mandatory Pension Rates updated from Jan 2013

The mandatory pension rates have been updated from Jan 2013 onwards as follows:

 

Employee – 5%

Employer – 5% + additional 5% towards severance pay.

total 15%

 

This is the 6th update out of  7. The law which began in Jan 2008 to ensure a pension to all salaried employees in Israel.

In 2014, the last update will come into effect.

Mandatory Pension law – updated Sep 7, 2010

Mandatory Pension law – updated Sep 7, 2010

Submitted by Moshe on Sat, 09/10/2010 – 23:18

 

The mandatory pension law was recently updated (Sept 7, 2010).
Originally planned for gradual annual updates from 2008 – 2013, when the mandatory % will reach 15% (5% employee, 5% employer and 5% severance pay -employer)

The new revision now ads another year (2014).
Starting Jan 1, 2014 the mandatory pension will be 17.50% as follows:
employee – 5.5 %
employer – 6.0 %
employer (pension) – 6%

The mandatory pension revision also specifies:
1) that it applies to employees who retired at retirement age and receive a stipend from social security (Bituach Leumi).
2) An employee who begins work at a new place of employment and is insured in a pension plan from his previous place of employment, will be eligible to receive the percentages specified in the mandatory mandatory pension law from day one with the new employer.

see the full wording of the mandatory pension plan here:

Risk Pregnancy (Shmirat herayon)

If a woman is diagnosed by her doctor to be in risk pregnancy, under certain conditions she may be eligible for a stipend from Social Security (bituach leumi).

Section 58 of the social security law defines risk pregnancy that entitles insured women to risk pregnancy stipend; absence from work during pregnancy due to medical condition that stems from pregnancy and endangers the woman or her fetus.

The conditions are:
1) Doctor’s note which explicitly states that the woman is in risk pregnancy.
2) the woman is absent a minimum of 30 consecutive days from work due to this condition.

The woman is entitled to continuous deductions to any and all social benefits (kupot gemel, keren hishtalmut, pension plans) provided she pays her part.

Most employers continue the payments and collect the employee’s part when she returns to work after maternity leave.

This period of time is considered to be continuous work period for tenure, social benefits. In other words, employer-employee relations are still in effect.

Forms for application and more information is available on the Social Security website:

www.btl.gov.il

New Mandatory Pension law in Israel

On July 19, 2007 a collective agreement was signed between the New General Worker’s Union’s professional and pension association and the liaison office of the financial organisations in Israel requiring employer’s to insure their employees in a comprehensive pension plan.

On July 30, 2007 this agreement was declared an expanded regulation order by the minister of labor, thereby making parts of the collective agreement mandatory for all employers and employees in Israel starting January 1, 2008.

Who does this apply to ?
————————

Any employee who isn’t insured and is employed/will be employed in any place of work.

Who does this not apply to ?
—————————-
1. An employee who is insured in a pension plan
2. An employee who retired from work at retirement age and is receiving a pension
3. An employee, who is 50 years old or older, who on the 1.1.2008 or the start of employment date (the later of the two) doesn’t have a pension plan can join at his choosing, by way of written notification to his employer, a gemel savings plan (pension or savings or any combination of the two) but if he doesn’t choose as said above this expanded regulation order will bind him as well.
4. Female employees under age 20 and male employees under age 21. when they reach said ages the expanded regulation order will bind them as well.

When does this law apply ?
————————–
Starting January 1, 2008 or the employee’s start date (the later of the two).

An employee who starts work and has no pension plan coverage at all will be eligible immediately for pension plan coverage after 6 months tenure.
(during 2008 the waiting period was 9 months).

An employee who starts work and has pension plan coverage will be eligible for pension plan coverage from his start date. The deductions will start after 3 month’s tenure or at the end of the tax year (the sooner of the two), retroactive to the start date. In this case there is no waiting period.

Employees who have tenure of at least 9 months on jan 1, 2008 – deductions will commence from Jan 2008.

Employees who have enure of at least 6 months on jan 1, 2009 – deductions will commence from Jan 2009.

Base pay for pension
——————–
The mandatory pension insurance is from the base for severance pay as defined by the severance pay law.
The ceiling is the average salary as publicized from time to time.
This is a gradual plan meant to bring the mandatory deductions to 15% within 5 years.
The deductions are done through payroll and will be itemized on the payslip, including accrued annual totals and employer’s part.

There are 3 parts to this plan: the employee’s part, the employer’s part and severance pay part (also the employer’s part)-and all are listed on the pay slip.

How much is the deduction ?
—————————
(Only the employee’s part is deducted from the employee’s pay)

Starting 1.1.2008 the employer’s and employee’s parts are 0.833% and the severance pay part is 0.834%
total 2.5%

Starting 1.1.2009 the employer’s and employee’s parts are 1.66% and the severance pay part is 1.68%
total 5%

Starting 1.1.2010 the employer’s and employee’s parts will be 2.5% and the severance pay part will also be 2.5%
total 7.5%

Starting 1.1.2011 the employer’s and employee’s parts will be 3.33% and the severance pay part will be 3.34%
total 10%

Starting 1.1.2012 the employer’s and employee’s parts will be 4.16% and the severance pay part will be 4.18%
total 12.5%

Starting 1.1.2013 the employer’s and employee’s parts will be 5% and the severance pay part will be 5% as well.
total 15%

The employer’s part for severance pay will be instead of severance pay according to the severance pay law and cannot be returned to the employer’s ownership unless the employee is denied right to severance pay according to sections 16 and 17 of the severance pay law, or in case an employee or his beneficiary withdraws money from a pension fund before he is eligible (death, retirement at age 60 or over, invalid)