Dear Clients and Colleagues,

In time for Spring, we would like to share the following recent updates in the field of Labour law:

A. Increase of the minimum wage to 5,571.75 NIS, beginning April 1, 2023:

• The Minimum Wage Law, 5747-1987 (the “Minimum Wage Law“) establishes that employees have a right to a wage not less than the minimum set by law. The purpose of the Minimum Wage Law is to ensure a relatively minimal standard of living for all workers. This is a cogent law, and therefore, the rights thereunder cannot be waived. The amount above set for the monthly minimum wage also influences the amounts of daily and hourly minimum wages.
• On March 23, 2023, the Minister of Labour signed an order as per which, beginning on April 1, 2023, the monthly minimum wage will be raised to 5,571.75 NIS (in place of the monthly minimum wage of 5,300 NIS in effect since December 2017).
• Accordingly, as of April 1, 2023, you should ensure to update the wages of those workers earning minimum wage. Similarly, we recommend checking if the increase in minimum wage will impact your engagements with service providers, for example cleaning, security, or catering services.

B. Update to the levels of financial sanctions that may be imposed under the Law to Strengthen the Enforcement of Labour Laws, 5772-2011:

• The Law to Strengthen the Enforcement of Labour Laws, 5772-2011 (the “Strengthening Enforcement Law“) is intended to strengthen and optimize the enforcement of Labour laws via, among other means, an administrative proceeding in which the Ministry of Labour may, under its authority, impose financial sanctions on employers and service user who violate employee rights. Schedule 2 of the Law includes three lists of laws the violation of which exposes the employer to such sanctions, and details the amount of fines to be imposed on the employer for these violations.
• As a result of the increase in the Index Rate announced in December of 2022 as compared to the Index Rate announced in June 2012 (which is when the Strengthening Enforcement Law took effect), the amounts of the financial sanctions set in Section 3 of the Strengthening Enforcement Law have been updated, as of January 1, 2023, as follows:

C. Publication of a report of pay gaps between female and male employees by June 1, 2023:

• In August 2020 we provided you with an update regarding an amendment made to the Law of Equal Pay for Female and Male Employees, 5756-1996 (the “Equal Pay Law“), which imposed an obligation on public sector employers as well as employers of more than 518 employees, to publish an annual report detailing the average pay gaps between men and women.
• In that context, it was determined that the employer must produce an internal report, which includes, among other items, detailed data regarding the average monthly salary of female and male employees, by segment, detailing the salary gaps, in percentages, for each group of employees. In addition, the employer must publish a public report available to the general public, which includes general information regarding the average pay gap between female and male employees in percentages. This will be based on the internal report, provided that the provision of this information does not violate any other law. The reports for the year 2022 must be prepared and published by June 1, 2023.

Employers who wish to prepare for the production of the reports are invited to contact us for individual advice.

D. Holding the implementation of the Procedure for Setting Conditions of Geographic Scope and Legal Permits of Asylum Seekers and Migrants:

• In June 2022 the Population and Migration Authority published the “Procedure for Setting Conditions of Geographic Scope and Legal Permits of Asylum Seekers and Migrants” (No. 10.1.0025), that was amended on August 31, 2022 (the “Procedure“).
• The purpose of the Procedure was to forbid the employment of migrants or asylum seekers who had residency permits (which are not work permits) under Section 2(A)(5) of the Entry to Israel Law, 5712-1952, in 17 cities. These cities include Or Yehuda, Azor, Eilat, Ashdod, Bat Yam, Givatayim, Herzliya, Holon, Kfar Shemaryahu, Netanya, Petah Tikva, Kiryat Ono, Ramat HaSharon, and Tel Aviv-Yaffo. In parallel, exceptions were put in place on the applicability of these geographic limitations on migrants or asylum seekers, based on established criteria such as field of employment, age, and individual circumstances.
• At this time, the implementation of the Procedure has been delayed due to a pending appeal to the Supreme Court.

We will continue to provide you with updates of any developments
and would be happy to assist in implementing the relevant legal changes.

We wish you all a Cheerful Spring !

The Labour & Employment Department
Herzog, Fox & Neeman