Israel: Employment during an Emergency and Granting Benefits during Unpaid Leave

Employment during an Emergency:

On March 22, 2020, emergency regulations on limiting market activity and limiting the number of employees in the workplace were published.

The regulations regarding limiting market activity provide, inter alia, that going out into public spaces from a place of residence or other place of permanent dwelling shall be done only for certain needs, among them an employee’s travel to and from the workplace.

In addition, in the workplace, a distance of two meters between people must be maintained as much as possible.

Travel by car is also limited to two persons only, except in the following circumstances: (1) essential necessity, or (2) when an employee of an essential workplace travels to and from work. In such cases, it is permitted for more than two people to ride in the same car.

As of this time, these regulations remain in effect until March 28, 2020.

The regulations regarding limiting the number of employees at a workplace stipulate that up to ten people or up to 30% of all employees, whichever is higher, may be present in the workplace. Employees informed by the employer that they may not be present at the workplace due to this restriction shall not arrive at work. Any employer who permits employees’ entry into or presence at the workplace beyond the maximum number of employees allowed to be present at one time may be punished by imprisonment or fine.

However, some employers are exempt from the regulations and may employ employees beyond this limit:

• A workplace in the field of construction or infrastructure that does not include congregation in an enclosed space may employ 100% of its employees. In this context, an enclosed space is a building where 70% of doors and windows have been installed.
• Companies with a special permit to employ employees during the weekly rest hours, granted in accordance with section 12 of the Work and Rest Hours Law 1951, in order not to compromise the work process, may employ employees at the number specified in the permit or up to 30% of all employees, whichever is higher.
• Companies that provide “essential services” (as defined in the Emergency Work Services Law).
• Companies that constitute a preferred factory as the term is defined in section 51 of the Encouragement of Capital Investments Law.
• Additional employers exempt from the regulations are corporations working in the financial sector, the energy (gas and electric) sector, the food and beverage sector, freight services, storage and customs, agriculture, toiletries, cleaning and cosmetics, ports and ships, transportation, media and communications, communication technology, computer and support services, maintenance, database maintenance, digital and development services that cannot be done remotely, delivery and messengers, health services, optics and pharma, and construction and infrastructure support. For the full list of exceptions, see here.

Even in workplaces where employees may be employed above the limits set in the regulations, the number of employees must be reduced to the minimum possible, so as to ensure only essential activity.

In addition, in order to ensure the effectiveness of the regulations and prevent the spread of the virus, to the extent the workplace constitutes several buildings, the employee must, as much as possible, work to spread out the employees between the various buildings (as long as this does not compromise the continuity of the work.)

To date, the regulations are in effect until April 16, 2020.

Giving Retirement Insurance and Car Use Benefits during Unpaid Leave

During unpaid leave, employees are not entitled to payment of salary and benefits, including pension insurance. However, some employers provide employees during leave with cars, phones, and laptop computers, and some are interested in continuing to pay employees their social rights (deposits toward pension insurance) even though there is no obligation to do so.

As a general rule, the reported income of an employee during unpaid leave is deducted from any unemployment funds the employee receives. However, in accordance with a clarification given by the National Insurance Institute on March 19, 2020, a benefit paid to an employee during unpaid leave by virtue of his actual period of employment with the employer shall be attributed to the previous work month before the commencement of unpaid leave. Therefore, the benefits shall not reduce the amount of unemployment or eliminate the entitlement to it, and thus the rights of employees shall be preserved during the unpaid leave. In our estimation, these benefits may help in obtaining employees’ consent to take unpaid leave.

The amount of benefits provided during this time and attributed to the month prior to the unpaid leave shall be considered the basis for calculating salary-replacing benefits, like unemployment payments.

Additional information on reporting such benefits to the National Insurance Institute can be found here.

Additionally, it is possible to deposit during the period of unpaid leave the employee’s share of pension insurance, with the employee’s advance consent, and to deduct the deposit upon return to work, as well as to calculate the employee’s share of tax for use of the car left in his possession during the period of unpaid leave.