New and Important COVID-19 Guidelines for the Israeli Labor Market

The State of Israel continues to cope with the COVID-19 crisis and its implications for the workforce. In recent days, new and important guidelines were updated for the Israeli workforce’s handling of the coronavirus crisis:

 1) Restrictions on Entry to Israel: Entry of Foreign Experts to Israel Significantly Restricted

In March 2020, Israel prohibited the entry of foreigners who are not citizens of the state or its residents. The Administration of Border Crossings, Population and Immigration is now outlining the cases where an extraordinary request may be submitted and the required procedure for doing so. Insofar as foreign experts are concerned, it was clarified that entry will be permitted in extremely extraordinary cases, if shown that the expert’s entry is essential to the Israeli market. Permission for foreign experts to enter Israel is subject to the recommendation of the relevant government ministry and the approval of the Administration of Border Crossings, Population and Immigration. As ever, one must secure a work visa before entry into Israel.

Additionally, in accordance with the rules currently in effect, in the absence of a special permit, international conferences and gatherings in Israel are also prohibited. Further, any person arriving from abroad into Israel is required to self-quarantine for 14 days from the day of arrival.

2)  The Impact of the COVID-19 Crisis on Pension Insurance Coverage

In order to preserve insurance coverage for provident fund members in light of the COVID-19, the duties to provident fund members were expanded. Respectively, so was insurance coverage. Therefore, for instance, the time frame in which the cost of insurance coverage may be deducted from the accumulated balance was extended, and a duty was imposed upon the bodies managing the provident fund to give written notice as to, inter alia, the period of time for which the insurance coverage shall remain in effect, the member’s deposit entitlements, and expected collection matters. Additionally, a mechanism to preserve insurance coverage in instances of wage reduction, under certain circumstances, was also established.

3)  Revoking Entitlement to Unemployment Funds for Corona-Based Unpaid Leave

The rules regarding the entitlement to unemployment benefits established at the height of the coronavirus crisis have since expired. Therefore, currently, an employee put on unpaid leave is not entitled to unemployment payments unless all of his or her available accumulated vacation leave has been redeemed first. This also applies to an employee who did not meet the eligibility period of 12 months’ insurance through the National Insurance Institute in the 18 months prior to his or her unpaid leave.

4)  Grants for Employers Who Have Hired Employees after the Crisis

This June, the Employment Encouragement Grant Law was published. It is designed to encourage the hiring of employees by granting financial incentives to employers. Receipt of a grant is subject to meeting several requirements:

• The employer “opened” its business before the COVID-19 crisis began and did not “close” it afterward. To fulfill this requirement, the employer must meet several cumulative conditions: the employer reported to the Israel Tax Authority the opening of its business before February 29, 2020, and did not report the closing of the business before May 31, 2020; the employer reported to the National Insurance Institute the opening of a deductions file before February 29, 2020, and did not report the closing of the deductions file before May 31, 2020; and, if relevant, the employer upheld its duty to keep books in accordance with the Income Tax Ordinance for the fiscal year 2019.

• The employee fulfills the requirements under the definition of “entitling employee” and meets the following cumulative conditions (but for several exceptions listed in the law):

1. The employee’s monthly salary is at least NIS 3,300 per month;
2. The employee is a resident of Israel; and
3. One of the following conditions is also met:
4. The employee is at least 18 years old and has yet to reach retirement age. Also, one of the following also applies: the employee was registered as seeking employment in the Israeli Employment Service between January 1, 2020, and February 29, 2020, and did not actually work until April 30, 2020, or was laid off or put on unpaid leave in the period between March 1, 2020, and April 30, 2020, or was on maternity leave on such dates;
5. The employee was entitled to a special adjustment grant or income security grant or unemployment payments for May 2020.

• The grant shall be paid in four installments (June through September 2020/July through October 2020). This in order to ensure the continued employment of the employee. The grant funds shall be as follows:
  • A total grant of NIS 3,500 shall be paid for employees returning or beginning to work prior to June 1, 2020 (according to the dates detailed in the law), in monthly installments of NIS 875.
  • A total grant of NIS 7,500 shall be paid for employees returning or beginning to work on or after June 1, 2020, in monthly installments of NIS 1,875.

• Currently, it is not yet possible to submit an application to receive a grant. It will be possible to do so within 30 days of the law’s publication. The application shall be made online via the Israeli Employment Service’s website.