salary

Employee’s rights on employer’s bankrupcy

Moshe

The law protecting employee’s rights in bankruptcy or liquidation of a corporation.

The law for security of employee’s rights when an employer goes bankrupt or when a court verdict orders the liquidation of a corporation came into being in 1975, in order to protect employees whose rights have been compromised due to difficulties the employer has come into and as a result of these difficulties a bankruptcy or liquidation order has been issued by a court of law.
This law is defined specifically in Chapter 8 of the Social security law.

According to this law, a salaried employee whose employer has declared bankrupcy or the company he has worked for has been liquidated, is entitled to payment for salary and severance pay that the employer owes him, up to the ceiling of the stipend as determined by the law. The employee is also eligible  that Social security transfer monies owed to his pension or savings plan if the employer has not deposited the required amounts owed (all or some).

 

Who is eligible ?

  1.  Salaried employees that their employer has declared bankruptcy or salaried employees that a court has issued a liquidation order against their employer (provided the employer is a corporation)
  2.  Pension/ Gemel fund if the employer owes money to a fund that the employee is ensured with.
  3.  Member of a co-operative who has been a member of a Kibbutz or a collaborative Moshav for at least 7 years
  4. An employee’s next of kin if an employee passed away before the benefit owed him was paid, his next of kin are eligible to receive the debt for salary and severance pay.
  5. Foreign workers / Yehuda – Shomron workers are eligible provided they have legal and valid work permits and visa. Illegal aliens are not eligible.
Note: An update to this law states that in projects that occurred from Jan 1, 2004 employees with controlling interests in a company are not eligible.

 

Conditions of eligibility

The benefit will be paid to a salaried employee if the following conditions are met:

A) A District court has issued a bankruptcy order or liquidation order to a company, co-operative, collaborative or Non-profit organization.

B) A district court has appointed a Trustee or liquidator to above.

C) The details of the employee’s claim have been acknowledged by the trustee or liquidator of the company.

 

How is the benefit calculated ?

An employee whose employer has been issued a bankruptcy order or liquidation order is eligible to receive a benefit from Social security, which includes amounts of salary owed him, that haven’t been paid by the employer and also amounts of severance pay that have no coverage in a pension / Gemel fund.

The benefit will be paid up to a ceiling of 79,750 sh for court orders issued up until July 31, 2009 or 103,675 sh for orders issued from August 1, 2009 onwards.

The amount of the benefit will include linkage from the date the debt was incurred until the payment date by Social security.

 

Salary items that are taken into account

  1.  Salary: according to section 1 of the protection of salary law that hasn’t been paid by the employer to an employee until the date he ceased work.Itemized salary that will be taken into account include: Base salary, overtime hours, premiums, bonuses, commissions, and any additions that are paid due to effort, or  departmental or professional reasons.The salary to be taken into account will not be less than minimum wage owed the employee according to his percentage of position (full-time, part-time). A benefit that is calculated according to minimum wage will be calculated for a period of up to 12 months.
  2.  Buyout of accrued vacation day balance: payment for the number of accrued and unused vacation days up until the date he ceased work, as they appear on his last pay slip, up to the maximum number of days that can be accrued by law and subject to the Annual vacation law. 
  3. Havra’a (convalesence pay): the part that was not paid to the employer up until the date he ceased work and for the last two years.

  4. Clothing stipend:  the part that was not paid to the employer up until the date he ceased work and for the last year (relevant only in places of employment where this stipend is paid – usually public sector only)
  5. 13th salary: the part that was not paid to the employer up until the date he ceased work and for the last year (relevant only in places of employment where this stipend is paid – usually public sector only)
  6. Value of advance notice: employees whose employer did not pay them the value of advance notice will be eligible to receive as part of the benefit, according to the Advance notice for termination and resignation law (2001).
  7. Employer’s portion towards pension: employees whose employer did not open a pension plan for them as required by law are eligible to claim the employer’s portion of 6% of the base salary and for a period that will not exceed 12 months after employer-employee relations were severed.Note: Any other itemized items on the payslip can be included as well, as long as they fit the definition of salary. Items that will not be included in the calculation of the benefit (for example) refunded car or telephone expenses, etc.
How do I apply for the benefit

The claim for a benefit is to be sent to the court-appointed Trustee or liquidator only and not to Social Security on a form 5305/bl (original only) along with documents to back up the claim. The form is available online on Social Security’s website: www.btl.gov.il or at  Social Security’s Head office in Jerusalem –  branch office (located behind Binyanei Hauma – 13 weizman st. Tel 02-6463020).

The appointed trustee or liquidator has approved the claim he will send it to Social Security’s head office.

Applications for claims relating to pension /gemel funds are to be submitted to the trustee or liquidator by the fund.

 

Tips

  • Always keep a copy of all documents for your own records
  • Never submit original documents, make photocopies of payslips, contract, etc to attach to the claim.
  • Send the claim to the trustee /  liquidator via registered mail with proof of delivery or submit in person and get them to stamp your copy “received” with the date on it.
  • Social Security recommends filling out the claim form in detail and accurately in order to avoid unnecessary delay in processing your claim.

 

Source:  Social Security (Bituach Leumi)

 

 

Garnished Wages – updated

Moshe

As of Jan 1st, 2012 the amounts exempt from  garnished wages have been updated as follows:

single – 2,093 sh

widower/divorced/single parent + 1 child – 3,384 sh

widower/divorced/single parent + 2 or more children – 4,221 sh

couple – 3,139 sh

couple + 1 child – 3,641 sh

couple + 2 or more children – 4,143 sh

 

Notes:

1) The above amounts do not apply to garnished wages for alimony.

2) Should the above amounts be more than 80% of the monthly salary (after deductions for income tax and social security and health tax) the amount exempt shall be reduced to 80% of the actual monthly salary.

 

source: protection of salary law, 1958 update 2012

 

 

How to understand your payslip – a guide for the perplexed

Moshe

Here is an explanation of the Israeli payslip for the perplexed: Broken down into color-coded sections. This article was a guest post I wrote for www.israemploy.net in 2010.
http://www.israemploy.net/The_Israeli_Pay_Slip_/

The Israeli Pay Slip – An in-depth Explanation for the Perplexed

For those of you that are working in Israel, or have worked in the past, trying to decipher your pay slip is one of the most complicated things you will experience in the workplace, right up there with understanding how to use the coffee machine.

We are fortunate to have Moshe Egal-Tal available to provide us with a comprehensive article about the intricacies of the pay slip, so that you can better determine how you are being compensated, and confirm that there are no mistakes.

As with most things, payroll is much more complicated in Israel than in other countries. In January 2009 a new law was passed to ensure uniform mandatory information that must be specified on all pay slips.

All of the payroll programs in Israel (which generate the pay slips) must be approved by the tax authority that they meet the mandatory requirements as defined by laws and regulations. Regardless of the program your employer uses, all the programs have common attributes. The layout and placement will differ a bit from program to program, but there are basic requirements that are mandated by law. The purpose of this article is to familiarize you with the terminology and help you understand what is printed on your pay slip. For those of you working, it is highly advised to examine your pay slip each month in order to ensure that there are no mistakes. Understanding what was paid/deducted from your pay is critical and to your benefit.

There are payroll programs for the PC that are off-the-shelf software (as is) that are commonly used by small employers / CPA offices who run payroll for their clients. There are also more complex programs that use a large number of variables that are user-defined by the employer. These programs are usually used by medium-sized and large companies. The PC programs generally allow printing pay slips on plain paper or pre-printed forms, which are more costly and as a result many employers are reluctant to use them. A plain paper pay slip is legal as long as it contains all the data required by law and as long as it is signed and has the company stamp on it.

The Makeup of the Pay Slip

The Israeli pay slip is made up of several sections (see Appendix for example):

· Specific information (header)

· Payments (tashlumim)

· Mandatory deductions (nikuei chova)

· Voluntary deductions / commitments (nikuei reshut / hitcheivuyot)

· Informatory information / accumulated sums (meida klali / mitstabrim)

The Specific Information Section (or header) (see sections #1, #2, and #7 on the demo payslip below) contains the employee’s name and will usually contain the name and/or number of the department/project where the employee works. Typically the employee number is also listed and the employee’s teudat zehut number and home address.

The pay period is also listed, for example: March 2010. The employer’s name, address and tax identification number and the employee’s bank account details and start date. If you work in the public sector, you will also have your pay table and rank listed as well as your % of position (full-time [100%] or part-time). There will also be a detailed account of your vacation and sick days; balance at start of pay period, credit for the pay period, debit for the pay period (how much you utilized) and your new balance.

The Payments Section (see #3 in red on the demo pay slip below) contains an itemized breakdown of all the components paid to the employee for the pay period. For example; Base pay, travel expenses, overtime hours, etc. Also in this section will be any tax value components (Holiday gift, company car or any other benefit that isn’t paid in money). The total gross pay will also be listed at the bottom of this section.

The Mandatory Deductions Section (see #8 in light blue on the demo pay slip below) contains an itemized breakdown of all deductions that are mandatory by law.

For example; Income tax, Social security, Health tax and mandatory pension payments. These are the employee’s part and as such are deducted from the total gross pay. The total of all the mandatory deductions will also be listed.

Some programs have added underneath the itemized breakdown of mandatory deductions, the employer’s part for any pension or savings funds or health insurance that the employee is entitled to. Other programs detail this in the informatory information section. The law stipulates that this must be detailed on the pay slip, but not necessarily where. It is usually categorized with an underlined or bolded headline or in a pre-printed field.

The Voluntary Deductions Section (see #10 in orange on the demo pay slip below) contains an itemized breakdown of all deductions that are voluntary.

For example; advances on payroll, repayment of loans to employer, charges for purchases to employees from a company store/collective purchase, payment for subsidized vacation or any other social or cultural events sponsored by or promoted by the employer which entail a cost to the employee or money deducted from an employee for loss or damage to equipment. The total of all the voluntary deductions will also be listed. This total amount is also deducted from the total gross pay.

The Informatory Information Section (see #4 in bright green on the demo pay slip below) will contain the monthly gross pay for tax and social security purposes and the monthly gross base pay for pension.

This section also will contain various informative details: total accumulative gross pay for the current tax year, number of actual days worked in the pay period, total number of potential work days in the pay period, the employer’s tenure is usually listed here as well. The employee’s tax credits as well as the value for each credit will be listed as well as a detailed account if there are any special tax benefits (oleh chadash, discharged soldier, national precedence area, etc) or a tax coordination was done.

The footer of the Pay Slip (see #4 in bright green on the demo pay slip below) {note: On this payslip this section is incorporated as part of the Informatory section} will contain the amount of days for tax purposes for each of the months worked. Monthly salaried employees will see 25 for each month worked, although there are payroll programs that put a check mark near each month worked.

The employee’s marital status and number of children under 19 years old will also show up here or in the specific information section. The employee’s marginal tax percentage and the accumulative amounts for the employee’s part of each of the funds/savings plans and whether the employee’s spouse is employed or not is included as well.

The minimum wage must also be listed (monthly and hourly rates). This section will usually have the total gross pay, total deduction, net pay, total voluntary deductions and pay in the bank listed.

Income Tax (will show up in section #8 in light blue, on the demo pay slip below)

The 2010 tax brackets are as follows:

Up to:

4,590 shekels 10%

8,160 shekels 14%

12,250 shekels 23%

17,600 shekels 30%

37,890 shekels 33%

Every additional shekel 45%

The tax is configured anew each month on an yearly-accumulative basis which takes into account all payments paid by the employer since January of the current year and after configuring the tax, the accumulative amount of tax that was paid is deducted and the remainder is the tax for the current month.

This is easily explained via the following example: for the first 3 months an employee earns the same gross pay. In the 4th month he receives a 3,000 shekel bonus. Obviously this will raise his taxes for this month. Occasionally, employees receive a tax rebate on their payslip via the form of a negative sum of tax.

Tax Credits/Points

All employees are eligible for tax credits (each worth 205 shekels – JAN 2010). The tax credits are allotted as follows: Every employee 2.25 points, Female employees an additional 0.50 points Single parents who have care of children under 19 get an additional point for each child and a half of a point for children the year they were born or the year they turn 19. There are other instances where employees may be eligible for extra tax points, but these may be given by the employer only upon written instruction by the tax authorities. Examples are: handicapped children, invalids, crippled or blind employees.

Consult the Israel Tax Authority’s web site for more information: (the total # of tax points will show up in section #4 in green on the demo pay slip below)

Social Security (Bituach Leumi) (will show up in section #8 in light blue, on the demo pay slip below)

Social security is mandatory for all female employees between 18 – 62 and male employees between 18 – 65. There is an employer’s portion and an employee’s portion. The money insures an employee against bankruptcy of the employer, reserve army duty, unemployment, old-age stipends, work-related accidents, just to name a few. For the first 4,806 shekels the rate for the employee is 0.4%, anything over this is calculated at 7%.

Mandatory Pension (will show up in section #8 in light blue, on the demo pay slip below)

The mandatory pension law went into effect in Jan 2008. All employees who either have an existing “live” pension plan from a previous employer or anyone with tenure of 6 months are eligible for pension. In 2010, the rates are: 2.5% employee, 2.5% employer and 2.5% severance pay (employer). The employee’s contribution is deducted from his payslip and must be deposited to the fund of the employee’s choosing.

Appendix

Explanation of the Above Demo Pay Slip: (click on the image to enlarge it)

1. Employer’s Information (name, address, tax i.d. #)

2. Employee’s Name and Address

3. Payments Section (itemized and total of all gross payments)

4. Additional Information, annual accrued totals and vacation and sick pay balances

5. Space reserved for notice to all employees such as “happy Holiday” (see example above), or personalized message for specific employee(s) such as “Happy Birthday”

6. Information Regarding this Pay Slip (the pay period and date the pay slip was printed)

7. Personal Information (Israeli ID #, basis of employment (monthly/hourly), bank account details, tenure, start date, marital status, etc)

8. Mandatory Deductions (itemized and total)

9. Net pay (prior to voluntary deductions)

10. Voluntary Deductions (itemized and total)

11. Net Sum Transferred to Employee (bank account/check)

Change in sick pay rates – April 2011

Moshe

Good news for employees who were forced to take time off work due to illness:

 

Update #4 – 2011 of the sick pay law, effective April 1, 2011 incurs a change in the rates paid:

1st day – no pay (no change)

2nd + 3rd days – 50% of regular pay (up from 37.5%)

4th day onwards – 100% of regular pay (up from 75%)

 

In addition, employees who work a 5 day week – 21 2/3 days will be considered a full month (entitling employee to 1.5 sick days credit). If an employee did not work a full month the  credit will be prorated accordingly. (This is a change from previously 25 days = a full month)

 

Notes:

  • The employee can request a doctor’s note for any illness.
  • The sick days need to be continuous, otherwise the count starts anew.
  • There is no buyout or redemption of unused sick days by law. This is accepted practice only in the public sector.
  • Sick day accrual, credit and debit as well as opening and closing balances for the pay period need to be itemized on the payslip.

 

 

 

Mandatory Pension law – updated Sep 7, 2010

Moshe

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:

Information on correct employment of youth

Moshe

Information on correct employment of youth

Submitted by Moshe on Tue, 29/06/2010 – 13:04

 

As summer vacation approaches, it is time once again to refresh everyone’s memory as to the laws regarding youth employment.

AGE OF EMPLOYMENT

It is strictly forbidden to employ youth under age 14.
Youths between the ages of 14 – 15 can be employed in light work only. Light work is defined as work that will not hinder or impair their health or development.
During the school year and in certain dangerous jobs, it is permitted to employ youth only from age 15 and up, under condition that the mandatory learning law does not apply to them.
(examples of dangerous jobs: heavy cutting machines, manufacturing and processing of flammable substances or items, work at temperatures below 4 c or above 40 c.
As for youth employed in commercials, preformances, etc. a special permit is needed from the Ministry of Industry, Trade and Employment, Other special regulations as to employment conditions and hours apply.

WORK NOTEBOOK & MEDICAL APPROVAL

The law mandates the employer to demand from youth employees (under age 18) to produce a work notebook, as a prior condition of employment.
This notebook is issued by the local employment services office. In order to procure a work notebook, applicants need to show up in person with their Israeli I.D. card (or one of their parent’s I.D. card where they are listed), a doctor’s note from the family practitioner, that they are healthy and able to work, 2 passport pictures. There is no fee to procure the work notebook and it is issued on the spot.
The work notebook needs to be on premises at the place of employment.

NOTIFICATION LAW

The purpose of this law is to make clear the conditions and terms of employment, rights and obligations of the employee.
Each youth must receive a written notification. signed by the employer, within 7 days of start of employment and it must include all of the following:
the ID number of the employee, employee’s name, address, start date and length of employment, work hours, job description, houly rate and all benefits and payments (i.e. travel expense), name and job description of the employee’s direct superior adn any other information which can help the youth understand his job and what is expected of him.

WORK HOURS

Youths can be employed for up to 8 hours maximum per day and no more than 40 hours per week.
Youths aged 16 and above can be employed for up to a maximum of 9 hours per day, as long as the maximum of 40 hours per week is complied with.
The above does not apply to youths that are employed and who are covered by preferential terms of employment or a collective agreement and also handicaped youth (physical, mental) who are employed in protected factories (factories that the State of Israel participates in their financing).

OVERTIME employment of youths in overtime is completely forbidden by law !

Weekly day of rest

It is forbidden to employ youths during their weekly day of rest (Shabbat) and there is no possibility of receiving a permit for this.

Breaks

After 6 hours of work, it is mandatory to allow youth a 45 minute break for rest and to eat, at least 30 minutes must be consecutive.
The break is usually on the employee’s time (i.e. unpaid) but this should be agreed apon before employment commences in order to avoid future misunderstandings.

NIGHT WORK

The law states that between the hours of 20:00 and 08:00 A.M., it is forbidden to employ youths under age 16.
Employment of youths, between ages 16 – 18 is forbidden between the hours 22:00 and 06:00 A.M. unless a special permit has been granted
from the Ministry of Industry, Trade and Employment.

RECORDING WORK HOURS

All employers are required by law to keep track and record the exact hours of work of all youth employees, and if such is done manually, each youth who is employed, and the employer need to authorize their hours by signing off on them daily.

ANNUAL VACATION

For the first four years at the place of employment a youth is entitled to 18 calander days (14 actual work days) of vacation time per year.

TRAVEL EXPENSES

In addition to pay, youth are entitled by law to re-imbersement for travel expenses from their home to work and back. The maximum rate per day for travel expense is 23.70 shekels. The employer is obligated to ensure that the youth employees have means to return safely home after work. youth who work 18 days or more, are usually paid the rate of a monthly free bus pass (chofshi chodshi). Those who work less than 18 days would be paid per day at the rate of cost (up to the max 23.70 sh)

FINES & DEDUCTIONS

It is illegal to fine or punish youth by means of salary deductions, unless specifically permitted by law. This includes any dedections for “damages”.

TAXES AND SOCIAL SECURITY

A youth’s income is taxable, just as a regular (over age 18) employee.
The only difference is that youth between 16-18 are eligible to receive an extra tax point each month. Male youth (16-18) receive 3.25 tax credit points, while female youth (16-18) receive 3.75 tax credit points. Each tax credit point is worth 205 shekels (as of Jan 2010).
Working youth are exempt from payments towards social security (bituach leumi) and health insurance (bituach briut), however the employer is obligated by law to pay the employer’s portion of social security as follows: (as of Jan 2010) 0.38% of the total gross pay – up to 4,809 shekels and 0.61% of every additional shekel up to 79,750 shekels.

MINIMUM WAGES FOR YOUTH (in Israeli Shekels) – updated June 2010

Age—— Monthly salary **—– Hourly Rate
——————————————————–
up to age 16 —– 2,695.13 —— 15.58
up to age 17 —– 2,887.63 —— 16.69
up to age 18 —– 3,195.65 —— 18.47
apprentices * —– 2,310.11 —— 13.35

* apprentices are in accordance with the apprenticeship law only)
** The monthly salary is for full-time position – no more than 40 weekly hours or 173 monthly hours. Partial positions are configured accordingly.

Even if a youth agrees to work for less than the amounts in the table above, it is illegal and the employer cannot pay less than the minimum.

IMPORTANT NOTE: There is no such thing as a “trial period” or “training” where the youth employee would not be paid !
Every period of employment carries mandatory payment for work from the first hour of work. Payment is mandatory for training, explanatory meetings, etc. such as pre-work meetings for summer camps.

continuation of pension plan by a new employer

Moshe

Continuation of pension plan by a new employer

Submitted by Moshe on Thu, 29/04/2010 – 15:13

 

An employee who starts a new job and has an active pension plan from a previous employer, can demand immediate deductions from his payroll from his start date, along with employer’s contribution according to the law.
In order to procure this the employee needs to present the new employer with a detailed printout of the existing accounts’ deposits.

This is highly recommended, rather than waiting several months until the employer starts deducting towards a new plan.This is highly recommended, rather than waiting several months until the employer starts deducting towards a new plan.

However, some employers will only do this after you have tenure of three months in order to ensure that employees stay on. If the tax year ends prior to your three month tenure date, it is required for the employer to forgo the 3 month waiting period because the pension funds do not allow retroactive deposits for previous years due to new regulations.

Q & A regarding part-time jobs

Moshe

Q  How is Havra’a configured for an employee who is employed in a part-time position ?

A  Employees who are employed part-time are paid the Havra’a supplement pro-rated to the actual % of the position worked. If you worked 55 %, you would get 55 % of the Havra’a supplement.

Q  I work 80 % position and recently returned from Maternity leave. I asked my boss to allow me to work 1 hour less each day (nursing hour) as defined by law. My boss says this doesn’t apply to me as I don’t work full-time. Is he correct ?

A  Yes he is, section 7 of Women’s employment law allows women who returned from maternity leave the right to work 1 hour less each day, with no deduction in pay for 4 months, provided they work full-time. If you work 99% position you are not eligible.

Q  My Job benefits include an annual payment of my car insurance, test and car license. I was told that if I work 75% position, I would only get 75% of these expenses. What is the logic behind this ? The expenses are still 100% ?

A  The logic is simple. This is a salary benefit and not a return of expenses. Although the expense remains the same for the employee, the employer’s participation is reduced according to the % of the position worked.

Q  I work at a 50% position. Many times we have pressure at work and I end up staying extra hours, but I am always paid 100% for these hours. Shouldn’t I be paid 125 % and 150% for overtime hours ?

A Actually, no. You need to fill up the hours you worked to 100% position. only then are you eligible for overtime hours.
The hours you worked that are in excess of your defined position are called extra hours or excess hours and they are paid at 100% rate. Overtime hours is a term specifically defined in labor laws as anything over full-time.

Q How are taxes configured for a part-time position ?

A Taxes are configured from the actual gross pay and the % of position is irrelevant.
However, if you work at more than one place of employment, you need to do a tax alignment (teum mas).

Q My boss wants me to go down to half-time position due to a slack in sales. Can he force me to do this ?

A Contract changes, especially in % of position, are acts that need consent of both sides (employer and employee). if an employee forces an employee to lower their % of position, this is a one-sided change of contract which enables an employee to resign their position while retaining rights to severance pay (provided the employee has worked 12 months).

Q I worked for 10 years full-time and now my boss wants me to go down to half-time. How will this effect my severance pay ?

A Ordnance 7 of the severance pay law specifically determines that severance pay shall be calculated according to the last full-time salary, pro-rated to the actual % of position worked for the whole period of employment. In other words,for the 10 years you worked full-time, you would be eligible for severance pay of ten full monthly salaries (1 for each year) and for the time you worked at half-time, you would be eligible for 1/2 a full monthly salary for each year worked.

New Mandatory Pension law in Israel

Moshe

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)

What are an employee’s rights for absence due to a child’s illness ?

Moshe

The sick pay law (absence due to child’s illness), 1993 states:

1. Absence due to child’s illness
(amended 1994, 1997, 1998)
An employee who has a child in his/her
care, that is not yet 16 years old, is
eligible to attribute up to 6 days of
absence per year to his/her child’s
illness at the expense of
utilizing his accrued sick days on the
condition that his/her spouse works and
wasn’t absent from his/her work for same
eligibility period, or the spouse is
self-employed and he/she wasn’t absent
for said sick days or that the child is
solely in the care of the employee.

2. Absence due to a child’s terminal illness
(amended 1997)
a) An employee who has a child in his/her care, who is not yet 18 years old, and has worked for at least one year for the same employer, is eligible to attribute up to 30 days per year of absence due to his/her child’s terminal illness either at expense of his/her accrued sick days of accrued vacation days, at the employee’s choice.
If the employee’s spouse is employed and wasn’t absent for the same sick period or the child is in the employee’s exclusive care, the employee is eligible to attribute up to 60 days per year of absence due to his/her child’s terminal illness
b) in configuring the number of sick days according to this section, days taken in accordance with section 1 will be taken into account.

This law is meant to add to the employee’s rights and not deter from them. Any agreement at a place of work that is more favorable than the law shall stand and this law will not be applicable.

How much advance notice are you entitled to when terminated ?

Moshe

When an employee is terminated from his/her position they are entitled by law to advance notice from the employer. The amount of advance notice is based on an employee’s tenure with the employer as well as his pay rate.

For employees being paid at an hourly or daily rate the employee is entitled to:

During the first year = 1 day for each month worked.
During the 2nd year = 14 days + 1 day for each two months worked.
During the 3rd year = 21 days + 1 day for each month worked.
From 4 years and on – one month’s notice.

For employees being paid at a monthly rate, the employee is entitled to:
During the first 6 months = 1 day for each month worked.
From the 7th month until the completion of 1 year = 6 days + 2 1/2 days for each month worked.
After completion of 1 year tenure = one month’s notice.

May 11th, 2009 mini-seminar at the AACI, Jerusalem

Moshe

On May 11th at 19:30 there will be a mini-seminar at the AACI – 11 pinsker st. Jerusalem. The topic is “what does the employer need to put on the payslip”
speaker: Moshe Egel-Tal, CSPP

Don’t miss this important topic !