The Israeli Minister of Labor, Haim Katz, has signed lately an extension order shortening the work week in Israel.

The new extension order will apply to the entire Israeli market.

According to the extension order, the work week will be shortened from 43 hours to 42 hours, without any reduction of pay.

The work week will be shortened by reducing one hour of work from one of the weekly work days – to be called the shortened workday. Employers are required to update their employees regarding the day chosen as the shortened workday. This day will be decided according to the employer’s work needs, as well as by taking the employees’ requests into consideration, to the extent possible.

Since the work week is being shortened without any reduction of pay, this basically means that employees will benefit from a rise in value of their hourly rate.

The extension order is expected to come into effect on April 1, 2018. Therefore, we recommend that employers begin preparing for the immediate effects of the extension order. Specifically, employers should take these steps:

  • Pick the shortened workday and the work rules relating to the change and/or replacement of the shortened workday.
  • Notify employees about the way the provisions of the extension order will be implemented.
  • Adjust payroll systems:
    • Define the work hours for the purpose of calculating overtime;
    • Adjust the hourly pay rate according to the standard for a full-time job, which is 182 hours;
    • Adjust the data on accumulated vacation pay and sick pay, which are calculated according to “hours of work.”