Hiring guide in Israel

What should I know about hiring in Israel?

Hiring remote employees in Israel can be complex, with many regulations and requirements that employers must know. Several aspects must be considered while recruiting, including job contracts, working hours, social security contributions, and immigration regulations. 

Every employee in Israel is entitled to a written employment contract that outlines all of their employment details, including their pay, working hours, and notice requirements. Also, it’s critical to be aware that several Israeli businesses have collective agreements that specify the terms and conditions for workers, including pay and working hours. 

Social security in Israel, including healthcare, retirement, and unemployment insurance, is provided by the National Insurance Institute, to which all Israeli employers must make a mandatory contribution on behalf of their workers. To ensure a smooth and lawful employment process in Israel, it is essential to have a thorough understanding of and abide by these requirements.

Why is Israel a good choice for finding remote employees?

With a highly educated workforce, a vibrant startup ecosystem, and a strong culture of entrepreneurship, Israel offers a wealth of talented professionals with experience in the latest technologies and tools required for remote work. 

Israel has a long history of valuing work-life balance, making it an excellent place for telecommuters who love a balanced professional and personal life. 

Your remote workers in Israel will have access to lightning-fast internet thanks to the country’s well-developed network infrastructure. Additionally, Israel has a high level of English proficiency, making it easy to communicate with remote employees.

How can Native Teams help you hire in Israel

With a highly educated workforce, a vibrant startup ecosystem, and a strong culture of entrepreneurship, Israel offers a wealth of talented professionals with experience in the latest technologies and tools required for remote work. 

Israel has a long history of valuing work-life balance, making it an excellent place for telecommuters who love a balanced professional and personal life. 

Your remote workers in Israel will have access to lightning-fast internet thanks to the country’s well-developed network infrastructure. Additionally, Israel has a high level of English proficiency, making it easy to communicate with remote employees.

Hire your first Israelian employee with Native Teams.

Legal requirements for hiring in Israel

Minimum wage

Contributions & taxes

Employer tax

The total employment Cost is between 20.88% to 24.33%.

Corporate tax

The corporation tax rate in Israel is 23%.

Employee tax

The total employee cost ranges from 9.5% to 16.78%.

Income tax

Individual income tax rates are between 10%-47%.

To calculate the salary and taxes in Israel please click here.

Payroll cycle

The standard pay period in Israel is one month.

Is there a 13th salary in Israel?

In Israel, the law does not mandate a 13th-month salary, but workers are eligible for a Leisure Payment after a year of employment. The payout amount is set by legislation, is reviewed and revised every year, and is directly proportional to the employee’s length of service, with payments typically dispersed between July and September.

Labor rules

Probation period

Following Israeli law, probationary periods are permissible, and during this time, the worker is treated as a permanent employee. Probationary periods are typically outlined in an employee handbook or collective bargaining agreement.

Notice period 

In Israel, the length of notice depends on how long the person has been with the company.

• An employee has served 0 to 6 months of service, one-day notice is required for every month of service if the employee has been with the company;
• An employee earns an additional 2.5 days’ notice for every month of service beyond the sixth month through the first year;
• A 30-day notice is necessary after 12 months of employment.

Severance period

After working for a company for a year in Israel, an employee is eligible for severance pay in the event of termination. The amount of severance compensation is determined by taking the employee’s monthly wage times the number of years the company employed them.

Per the terms of the Section 14 Arrangement, the company will put aside a portion of each employee’s monthly compensation, equal to 8.33% of their base income, to be used for severance purposes. 

Working hours

The standard work week in Israel is capped at 43 hours. Workdays are scheduled to last 8.6 hours for those who work five days per week and 8 hours for those who work six days per week, with Fridays off. Nonetheless, some Israelis put in extra hours on Friday mornings, staying at the office until 12 a.m.

Leave and benefits

Public holidays

There are 9 official holidays in Israel:

• 1. First Day of Passover
• 2. Seventh Day of Passover
• 3. Yom Ha’atzmaut
• 4. Shavuot
• 5. Rosh Hashanah
• 6. Yom Kippur
• 7. First day of Sukkot
• 8. Shemini Atzeret
• 9. Simchat Torah

Sick leave

The maximum amount of sick leave an employee can accumulate is 90 days at a monthly rate of 1.5 days each month. The following schedule governs how long a sick leave can be paid out:

• The sick leave employee will not be compensated for the first day of sick leave;
• Employees are entitled to 50% of their regular pay for the second and third sick days;
• On the fourth day, the worker is due their full compensation. 

At the time of their return, the worker is expected to present a doctor’s note verifying their health.

Maternity leave & paternity leave

After working for an employer for a year, women are eligible for 26 weeks of maternity leave, which may take up to 7 weeks before the child is due and the remaining weeks after the child is born. If an employee is qualified, she will receive 15 weeks of fully paid leave and 11 weeks of unpaid leave during her maternity leave in Israel through the country’s Social Security system. 

Female employees with less than a year of service are only eligible for 15 weeks of maternity leave. In the event of multiple births or complications during delivery, an employee can receive an additional 3 weeks of paid leave. An employee can take up to 60 days of unpaid maternity leave following the birth of a child if the mother loses the baby.

A father may use sick leave to stay home from work for up to 24 hours after a child is born, beginning when their partner goes into labor.

Other leave

Bereavement leave

Israel’s law provides up to 7 calendar days of paid absence for mourning the loss of a close relative. After 3 months of employment, an employee is entitled to unpaid bereavement leave.

Parental leave

Fathers can take time off after the birth of a child; however, this time will be deducted from the mother’s paid leave.

What are the minimum vacation days?

Throughout the first 5 years, workers get 16 days of paid vacation. This increases to 18 days in year 6, 21 days in year 7, and finally, 28 days in year 8 and beyond. If an employee works a 6-day week, they can take off 6 days for every week of paid leave that is legally accrued.

Insurance

Health security & private insurance

Anyone who has worked for an employer for at least three months within the previous fifteen months is entitled to free medical and dental care through the Social Security Administration.

*Native Teams can support you in finding the best private insurance in the country. Contact us and we will send a comparison of insurance packages and prices.*

Visa

Relocation and work permits

Native Teams will apply for your work visa in the nation on your behalf and serve as your Employer of Record. All the required documents can be uploaded using our app. Until you have your work and residency visa, Native Teams will support you by providing you with frequent information on the progress.

How long is the visa/work permit process?

2 to 4 weeks depending on the authorities and provided documents.

Which documents do you need?

To apply for a visa/work permit in Israel, upload the documents from our onboarding list (relocation to log in/pricing).

Why use Native Teams for hiring in Israel?

Native Teams lets you employ team members ‘like a local’ meaning you get all the benefits of a global team, wherever you are based. Here are the reasons why you should use Native Teams for hiring:

• No paperwork: We will handle all the necessary paperwork for you.
• Save on taxes: We help you handle your taxes.
• No company set up: You can expand your business using our company entitles.
• Online onboarding: We’re here to ensure your onboarding process is trouble-free.
• No accounting: We will handle all of your accounting needs, including invoicing, payroll, and more.
• Increase your profit: We assist you in growing your business and maximizing your profits.
• Compliance expertise: we can assist your company in navigating the regulatory environments and ensure you meet all relevant requirements.
• Local support: We can assist you in understanding and complying with the relevant local laws.