What are the standard working hours in Israel?

In Israel, the standard work week consists of 42 working hours, distributed as follows:

• 8.6 hours worked for four workdays.
• 7.6 hours worked for one workday.

Is overtime governed by law in Israel? If so, what are the specifics outlined by law?

In Israel, overtime is indeed governed by law and is permitted only under limited circumstances. The specifics of overtime regulations are as follows:

• Any working hour in excess of the 42-hour full-time work week is considered overtime.
• Employees may work a maximum of 15 hours of overtime per week.
• Certain roles, such as managerial positions or those involving special fiduciary duties, may be exempt from overtime pay.

To streamline overtime compensation, a global overtime policy can be adopted. This involves dividing the total salary into two parts:

• Base salary: commonly 68% to 80% of the total salary.
• Global overtime compensation: making up the remaining 32% to 20%.

The base salary allocation corresponds to a specific number of overtime hours:

• 80% base salary typically equals approximately 36 overtime hours per month.
• A 68% base salary corresponds to around 64 overtime hours per month.

Generally, overtime compensation is included in the employee's monthly remuneration through the Global Overtime Compensation system. A specific clause addressing this is added to the employment agreement unless the customer asks for it to be removed. If removed, overtime will be compensated in accordance with applicable legislation.

How is overtime payment calculated in Israel?

Overtime payment in Israel is calculated using two primary methods:

• Actual Overtime Hours: Employees receive compensation based on the actual overtime hours worked. The rate for the first two hours of overtime is 1.25 times the employee's hourly wage, while any additional hours are compensated at 1.5 times the hourly wage. The maximum allowable overtime is 15 hours per week.

• Global Overtime Compensation (GOC Arrangement): This method involves a predetermined gross monthly amount designated for a certain number of overtime hours. It is commonly included in Israeli employment agreements. For the GOC Arrangement to be valid, it must meet specific criteria:
• It should reflect the average overtime worked by employees.
• The overtime amount should be separately listed on the employee's pay slip from the base salary.
• It cannot cover hours beyond the legal maximum.

Employees may be eligible for additional payments if they can prove they worked more overtime hours than covered by their employment agreement.

In Israel, the workweek comprises 42 hours, typically 8.6 hours for four days and 7.6 hours for one day. Employees receive overtime pay for working beyond these hours on a weekly or daily basis. Special overtime rates apply for work on a rest day. The typical salary distribution for overtime includes 80% base salary and 20% GOC, equivalent to approximately 36 overtime hours per month. The maximum distribution is 68% base salary and 32% GOC, corresponding to 64 overtime hours per month.

How many days before the actual start date should the employment agreement be signed for payroll purposes in Israel?

In Israel, the supported employee can sign the employment agreement up until their start date, provided their hiring documents are available by the payroll deadline processing.

Can employment agreements be backdated in Israel?

Yes, in Israel, employment agreements may be backdated. This practice is legally permitted.