Increase to employer and employee pension contributions

As of January 2017, employees will contribute 6% of their monthly salary to their preferred pension arrangement and employers will contribute at least 6.5% of the employee’s monthly salary to the employees’ pension arrangements in addition to the mandatory severance payment contributions.

Increase to annual vacation days

Following an Amendment to the Annual Leave Law, as of January 2017 the minimum vacation day entitlement for full time employees in their first four years of employment is 12 days.

Increase to national minimum wage

As part of the gradual increase in the minimum wage, as of January 2017 the minimum wage in Israel will be NIS 5,000.


New rights for parents to be paid when absent due to a child’s illness

In March 2016, an amendment to the Sick Pay Law (Absence due to Child’s Illness) 1993 changed the rules regarding circumstances in which an employee may be entitled to receive sick pay due to a child’s illness. As of April 2016, employees who are absent from work when their child suffers from a disease that requires routine dialysis treatment or when a child suffers from any other disease to be determined by the government will be entitled to sick pay.

In August 2016, another amendment was published pursuant to which employees are entitled to receive full sick pay on the first day of absence due to their child’s illness.

New rights for fathers regarding paternity leave

An amendment to the Employment of Women Law 1954 granted a male employee up to five days leave after the day his spouse/partner has given birth without the need to obtain the employer’s consent and a daily hour of paternity leave after their spouse/partner has given birth for a period of up to four months following the maternity leave.

Reduction of transportation allowance

In August 2016, the Minister of Welfare and Social Services issued an extension order pursuant to which the maximum daily amount that an employee is entitled to receive from an employer for transportation expenses was reduced from NIS 26.40 to NIS 22.60.

With thanks to Ben Sandler of Yigal Arnon & Co. for his invaluable collaboration on this update.