ISRAEL Law and Practice Contributed by: Tal Keret, Shira Lahat, Neta Goshen Brami, Shira Cohen-Mazor and Shirly Mahlab Hefetz, Arnon, Tadmor-Levy
1. Employment Terms 1.1 Employee Status
a specific task). In the case of a fixed-term contract, the employer is obligated to work until the end of the period stipulated in the contract. Even if an employer chooses to terminate the employment before the end of the fixed period, it may be obligated to pay the employee’s wages until the end of the fixed period. At the end of the fixed period, the employment contract automatically expires and the employment relation - ship ends. In any other case in which an employer wishes to terminate the employment of an employee – whether it is a fixed-term contract or an open con - tract – a full and proper dismissal process must be fol - lowed, including a hearing before a decision is made. The purpose of the hearing is to allow the employee to present their claims and defend their rights before a final decision is made in their case. 1.3 Working Hours According to Israeli law, the length of a standard full- time workday in places that operate five days a week is 8.6 hours. On one day of the week, an employee is entitled to a shortened workday of 7.6 hours. The total duration of a typical full-time workweek is 42 hours. Employees are of course permitted to work overtime. According to the general permit applicable in the Israeli labour market, employees can work up to 12 hours a day (including overtime) and up to 16 hours of overtime per week. Overtime must be compensated at a higher rate – 125% of the regular wage for the first two hours and 150% for each additional hour thereaf - ter. Certain categories of employees, such as those in managerial positions or “trust roles,” may be exempt from the entitlement to overtime pay. Flexible work arrangements are possible and can be agreed upon between the employer and the employee, provided they meet the legal requirements and do not waive any mandatory rights. Part-time employment con - tracts must specify the scope of employment, includ - ing the number of weekly or monthly hours, and the employee’s rights (such as wages, benefits, and time off) are calculated on a daily basis and proportionally to those of full-time employees. 1.4 Compensation In Israel, the minimum wage is set by law and updated periodically by the government. As of 2025, the legal minimum wage is NIS6,247.67 per month for full- time employees, or NIS34.32 per hour. Employers are
The expression “manual labour” is referenced in sev - eral Israeli legislative texts, yet it lacks a formal legal definition. Under Israeli law, the generally accepted distinction is that a blue-collar worker (ie, a manual labourer) is an employee whose work is primarily the product of physical effort. In contrast, a white-collar worker may use their hands in the course of their duties, but the essence of their work is not the result of manual or physical labour. Importantly, even work that is not inherently physi - cal may, in certain circumstances, be classified as manual labour. However, for several specific occupa - tions, Israeli regulations and case law have explic - itly determined that these do not constitute manual labour. Examples include administrative or clerical work, technical roles involving training and installa - tion of electronic products, electronics technicians, cleaning staff, and caregivers. A key legal implication for blue-collar workers is their entitlement to a work break at an earlier stage of the workday, as established under labour laws such as the Working Hours and Rest Law. Beyond the blue-collar/white-collar distinction, Israeli labour law recognises additional employee statuses, including: • full-time v part-time employees; • managerial or “position of trust” employees (with unique terms regarding working hours and over - time pay). Each classification may influence the applicability of certain labour rights and protections. 1.2 Employment Contracts According to Israeli law, employees can be employed under two types of contracts: an indefinite contract (ie, work without a predetermined termination date) or a fixed-term contract (for a predefined period or for • permanent v temporary employees; • salaried v hourly wage employees; • outsourced (agency) workers; and
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