National minimum wage in detail

There is a duty to pay a full-time adult employee the minimum wage, currently a gross monthly amount of NIS 5,300. Due to the shortening of the workweek which entered into effect in April 2018, the hourly minimum wage has effectively been increased from NIS 28.49 to NIS 29.12 (calculated by dividing the monthly minimum wage of NIS 5,300 by the reduced number of 182 monthly hours of work). Part-time employees are entitled to a partial minimum wage to be calculated pro rata.

The law describes the limited payments that may be included within the minimum wage, as follows: basic or ‘combined’ wages (combined wages being basic salary plus a supplement normally determined by the employee’s seniority); a cost of living allowance (if not included within the combined wages) and any fixed additional amount paid to the employee as a consequence of his or her employment, with certain exceptions set out in law.

The law also determines different minimum wages for special categories of employees, such as minors, workers with disabilities and security guards and cleaners who are employed through cleaning service companies.

The minimum wage must be paid in cash unless an applicable collective bargaining agreement or the employment contract permits other means. A small portion of the wage may be paid in kind (e.g. in food or accommodation) if this has been agreed upon by the employee or is envisaged under an applicable collective bargaining agreement.

The minimum wage is periodically increased by either the government or parliament. There is no specific schedule for such increases. 

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Author: Herzog Fox & Neeman

Date: April 2020

Note: For specific advice on any particular issue, please consult the relevant firm. The law is stated as at March 2019.