LEGALINK CROSS-BORDER LAYOFFS QUESTIONNAIRE
A COUNTRY BY COUNTRY SUMMARY OF APPLICABLE EMPLOYMENT LAWS
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ISRAEL(a) Advance Notice of Resignation and Dismissal Law 5761-2002 provides for a prior written notice of up to 30 days. In addition it is mandatory to conduct a hearing procedure according to the terms determined by various precedents. In case of layoff of an employee, severance payment equivalent to one month's salary per each year of employment is mandated under the Severance Pay Law 5723-1963 (b) The above shall apply also in case of a mass layoff. Under Sec. 37 of the Employment Service Law 5719-1959 an employer who gives termination notices to ten or more employees shall notify the competent Employment Service Office of such termination notices.
No specific requirements are specified in any applicable law, however such requirements may be inferred from applicable collective agreements.
(a) Under certain circumstances, potential laid-off employees may rely on several employment laws, which condition the termination of employment on the receipt of a specific permit from the relevant authorities. For example, in the case of a pregnant employee who has worked at least 6 months, the termination of employment during the pregnancy period, the maternity leave and sixty days thereafter is subject to a specific permit to be given by the Minister of Industry. Another example is the case of an employee who is in army reserve duty, whose dismissal during the period of service and 30 days thereafter is subject to a specific permit to be given by the authorized committee under the Discharged Soldiers (Reinstatement in Employment) Law 5709-1949. (c) Potential laid-off employees may also base their claim on the provisions of an applicable collective agreement in case the lay-off procedure is not conducted in the required manner. In the absence of permit and/or in certain cases of laying-off not in accordance with the relevant laws, the lay-off may be considered null and void and the court may order the reinstatement of employment of the employee. In case of other infringements of legal requirements and/or laying-off not in accordance with collective agreements the sanction may be pecuniary only. Compensation shall be determined by the Labour Court at its discretion and, except for unusual cases, shall amount to the actual loss of the employee's salaries up to a period of 12 months.
Lately the implementation of the rule of hearing has become more common; however there are still cases in which the court ordered compensation for unlawful dismissal only because of the absence of the requested hearing. In addition, sometimes only during the hearing is certain information obtained, which forces the employer to take different measures in order to implement the legal dismissal of the employee. It is therefore highly recommended to carefully follow the terms determined by the court regarding the hearing procedure including the hearing of the employee's arguments with an open mind and in good faith.
It should be noted that all the above provisions and prohibitions (including the requirement to obtain the necessary permits) shall apply also in case of the closing down of a company. Such is the case also when a company is purchased by another entity and the employees are dismissed and re-employed by the purchasing company as its employees.
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