Route 38 Blog
Our second networking event was a huge success! We learned all about saving for retirement from Motty Handler, while enjoying sushi, fresh fruit and candy. Most importantly, we met other professionals, traded advice and dreamed up new collaborations.
Check out these pictures from the event:
Do you know your rights as an employee? We recommend having a general working knowledge of the employment laws in Israel. Employees who are not well-versed in their rights can be taken advantage of, and this can easily happen to olim who don’t ask the right questions (or ask the right people).
Additionally, there can be specific issues that you need in-depth information on, such as the intricacies of termination, maternity pay and pensions. Our goal here is to provide as much helpful information as possible, but if you need greater detail, here’s how to get it.
The Kol Zechut (All Rights) website is partially translated from the Hebrew site and includes many articles on all aspects of legal rights, from health and disability to immigrants and old age. There are numerous articles about employment issues, such as pensions, National Insurance, income tax, labor laws and more.
Kav LaOved is an Israeli nonprofit organization which provides individual help to employees who suspect that their rights have been violated or who want to better understand their circumstances. The organization has office hours and a hotline and can also be contacted via email. The website provides some English language brochures about topics such as work accidents, hourly workers and women’s rights in the workplace.
For more general information, see Nefesh B’Nefesh’s online article on Employee Benefits. This article covers some of the basics of the employee-employer relationship and Israel labor laws.
The Human Resources representative at your company is also a useful resource. In larger companies, there may be an entire HR department, but even in smaller companies, someone is in charge of HR. If you don’t know who that is, ask. The HR representative should be able to explain your pay stub, assist with specific questions and provide you with necessary forms.
There is strength in community. You can easily get answers to employment questions by posting on olim social media groups, especially those that are dedicated to career discussions. Of course, not all these answers will be accurate, so take them with a grain of salt, but there is often a consensus on legalities and processes which can point you in the right direction. These groups can also provide firsthand experience of other olim, which is often invaluable.
Knowledge is power and this is certainly true in the realm of employee rights. Awareness can help you choose the right job, get what you deserve in your job and leave a job in the right way.
Route 38’s office space in Har Chotzvim, Jerusalem is available for rent. Choose a dedicated desk or a private office. Take advantage of the conference room, internet, printing facilities and free hot drinks.
Additionally, members of the Route 38 family may come and enjoy any of our hot desks for free , up to 20 times a year.
Prices for monthly rentals are as follows:
On March 9, 2022, Route 38 celebrated the opening of its new offices in Jerusalem with its first networking event. A light dinner was served in the lobby of the new co-working space in Har Hotzvim, accompanied by lots of schmoozing. This was followed by short presentations by Baruch Swinkin and Yael Frydman and a networking session by Helena Baker, in which she taught everyone how to give an unforgettable elevator pitch. And we will certainly not forget Mike Kashnow’s pitch!
Here are a few pictures from the event:
Are you a business considering hiring Israeli talent? You don’t want to miss this interview with Baruch Swinkin, CFO of Route 38. You’ll get the whys and the hows of hiring Israelis when you don’t have (or want) an office in Israel.
Mazel tov on setting up your new business! If you’re just starting out, chances are that you will be an “Osek Patur,” a business which is exempt from collecting and paying VAT. The following is a brief overview of what you need to know for your new Osek Patur.
Receipts can be issued in two ways:
The invoice must include the following details on the top:
Full name/Business name, Address, Phone number of the business and osek patur number (which is generally your teudat zehut number).
The receipt should provide information about the service provided and the method of payment (cash, bank transfer, check – including check number). If payment was in another currency, include the rate of exchange to shekels.
It is strongly advised to keep as many expense documents as possible. Any expense that you submit will save you from higher income tax and Bituach Leumi payments.
It is also advised to keep donation receipts in order to reduce tax payments (or receive a tax payment refund), if you have any. Please note that receipts must be from Chapter 46 recognized organizations,and their status must be noted on the receipt. This applies even in years that one did not make any tax payments, as donation receipts may be used for 4 years.
The following are considered direct business expenses, and are 100% recognized and deductible:
Indirect/mixed expenses, partially recognized:
Home expenses- 25%:
One is obligated to count all inventory in one’s possession on December 31st of every year, in the event that one has raw materials or equipment or other items for sale that require evaluation.
Sometime after the opening of your independent contractor tax file, Mas Hachnasa will request and require a Hatzarat Hon (financial statement) as of December 31st of the year that the tax file was opened. The statement details all the assets and liabilities of the business owner as of the date of the statement. Additional Hatzarat Hon requests are generally made once every 4-5 years.
It is generally recommended to submit this statement with the help of an accountant or tax consultant, since it can be complex. The first one should certainly be submitted with professional assistance, since it serves as the basis for all future statements.
Videographer and photographer Yirmiyahu Vann is an expert in visual storytelling. Listen to his tips on getting great headshots, creating meaningful videos to grow your business and mountain biking in Israel (VR camera in hand)!
Abby Weisz, LCSW, M. Ed, tells us about her work as a marriage therapist focusing on sexuality and intimacy: What made her choose this field, why she’s sad to have so much work and what rabbis say about what she does. Oh yeah, she also tells us why she chose to work with Route 38 in their Wellness Center division and how that helps her run a successful therapy practice.
One of the biggest challenges of moving to any new country is finding a job and aliyah to Israel is no exception. It can be daunting to seek employment in a country where the norms are different from your home country, the primary language is Hebrew and everyone else seems to know each other. But have no fear; many olim are gainfully employed in Israel and you can be too.
Your first step in your job search is to create a resume (or CV as it tends to be called here) that fits Israeli standards. CVs should be one page long and include a list of skills above your experience and education. If you’ve had many jobs, remove the oldest ones and the least relevant to the job you are applying for, so you can keep to the one page format.
Whether you need a Hebrew CV is dependent on the industry you work in and the type of job you are looking for. Even many Israelis submit English CVs, especially in the hi-tech industry. It’s best to ask around in your industry (you can easily do this on a Facebook or LinkedIn group if you don’t personally know anyone who works in the field) to find out what language your CV should be in.
Until recently, CVs always included personal information like marital status, children and home address, so you might be told to add these to your CV. But most experts in job hunting are now recommending against this, since these personal details can cause prejudice.
When sending a CV to a company, include a cover letter in your email of up to 5 sentences, detailing why you are the right person for this job. Your cover letter should be tailored to the job you are applying for, so send a different one for each application.
It’s important to have references prepared as companies will often ask for them. If there’s no room on your CV to list them, you can leave them out, but make sure that you have names ready and that you have asked for permission to share their contact information. Be sure to add a line on your CV that says “References available upon request.” If you are asked for references, provide names, phone numbers and email addresses.
One place to search for a job is online. There are a number of Hebrew job posting websites (some may require a paid membership) and the Nefesh B’Nefesh Job Board and Janglo website list jobs that are geared specifically to olim, many not requiring any Hebrew. Jobs are also listed on Facebook and LinkedIn groups, especially those catering to English speakers. Cities with large Anglo populations tend to have local Facebook groups which may have job opportunities and there are also groups devoted to job postings and career advice.
It’s true that a lot of Israelis find jobs through relatives and old army buddies. You may not have those, but you might have friends who made aliyah before you, acquaintances who are willing to lend a hand and Facebook friends or LinkedIn connections who are happy to support fellow olim. Put yourself out there by calling and posting on social media about the kind of job you are looking for. This is commonly done by Israelis, whether they are looking for their first job or have left their previous job for whatever reason. You may hear about positions that haven’t been advertised yet or get your CV on the top of the pile because of a personal recommendation, so this is well worth doing.
If there’s a company you would like to work for, you can reach out directly to their HR department and ask if they are hiring. Even if they aren’t, they will often keep your CV on file and contact you later if an appropriate position becomes available.
If you have previously worked in a company with offices around the world, find out if there’s an Israeli office you can apply to work at. You might even be able to transfer your existing position to the Israeli office. It is also possible to work for a company outside of Israel, if they are comfortable with hiring a remote employee. Many olim work from home or in a shared workspace for a company based in their home country.
This won’t always work, since many local subsidiaries of global companies are not interested in putting an employee of a foreign subsidiary on their books due to factors such as budget, headcount restrictions and payroll imbalance. It never hurts to ask, though!
Depending on your industry, you may find that a headhunter can help match you with a position that’s right for you. Headhunters specialize in helping companies (usually large ones) find the right employee. They are paid by the firm which is hiring and do not take payment from job seekers.
Career consultants help people navigate the job search. They are paid for their time and expertise, regardless of whether you find a job. According to Marna Becker of MRB Consulting, career consultants can help you by sharing their built-in network, improving your CV, boosting your networking skills and troubleshooting why you’re having trouble finding a job.
Career consultants are especially useful if you are looking for your first job in Israel, don’t have a strong network here and are not familiar with the norms and company culture in the country. They are also helpful if you’re just entering the workforce and need help deciding what profession to pursue based on your skillset, personality traits etc. Additionally, a career consultant can be of great assistance if you’re contemplating a career change and aren’t sure what you want to do or how to transfer your skills to a new field.
There are also human resource companies which specialize in placing employees in positions. Be aware that these companies are sometimes also the employers, and the salary and perks of the job may differ from those offered to the employees of the company proper.
If you’re making aliyah now, be aware that Israeli companies tend to want their employees to start sooner rather than later, so searching for a job months before moving to Israel is likely to be futile. Use that time to check out the job market in your field and make some connections, and start applying shortly before aliyah or once you are already here.
If you are currently employed in Israel, make sure you know how much notice you need to give your current employer, so you don’t end up in a situation where you can’t take a job you were offered due to an early start time. (The notice period is generally a month if you have worked at a job for at least a year.) If you’re on maternity leave, start looking for work close to when you are willing to start a new job.
An exception to this rule is if you are in a field where contracts are on a set schedule, like education. Conventional wisdom is to start searching for a position in education around Pesach time, in order to start in September.
Job interviews are often less formal and this can take some olim by surprise. Questions might range from the professional to the personal, and don’t be surprised if there’s some Jewish geography mixed in. Candidates are often asked what their salary expectations are. You can sometimes turn the question on them and get them to tell you what they want to pay, but this won’t always work, so be prepared with a range and be open to negotiation.
Job hunting in Israel may take some time, but the jobs are out there and you can certainly find one. Wishing you a successful and smooth job search!
Israeli labor law has determined a minimum number of vacation and sick days, but company policies may differ and you may be entitled to more benefits than legally required. Here we delineate what is legally required.
Employees are entitled to up to 9 paid vacation days for national holidays, assuming these days fall on a weekday. These holidays are religion-dependent. For Jewish workers, the days are:
Employees who usually work on Fridays or Shabbat get paid for these vacation days if they fall on a weekend, but employees who work Monday-Thursday are not paid extra for national holidays that don’t fall on a work day.
Additionally, there are other days which are not national holidays but which any Jewish employee can take as one of their accrued vacation days (up to one day per year). These are called “Yemei Bechira” (chosen days):
An employee’s allowance of vacation days depends on whether the job is full or part time, how long the employee has worked at the company and how many days a week the job requires. The minimum number of annual vacation days for a full time employee is 12.
It is within the employer’s rights to determine when an employee can take vacation and it is legal for the office to be shut down for a specific time period and all employees required to take their vacation at that time. If the enforced vacation is for 7 days or more, the employee must be informed at least two weeks in advance.
Employees are entitled to take one vacation day a year at any time, without need for the employer’s consent, on the condition that the employee notified the employer thirty days in advance.
Employees who are absent for reserve duty, a worker’s strike (unless they are government employees), maternity leave, mourning/shiva or national elections do not have these days deducted from their annual vacation days.
A salaried employee who works full time at once place of employment is eligible for 18 sick days a year (1.5 per month). Sick days can be used for one’s own sickness or in order to care for a family member who is sick. Legally, the employee isn’t paid for the first sick day. The second and third days are 50% pay and the fourth and on are 100% pay. In order to be eligible for this payment, the employee must provide a sick note from a doctor.
Some companies stipulate in their contracts that the employee is entitled to more sick days, that they pay for the first sick day as well or that they offer more vacation days than stipulated by law. When negotiating a contract (either for a new job or in the case of a promotion) these stipulations can often be negotiated. Sometimes, despite a company standing firm on the salary they are offering, they are flexible on vacation and sick days. It is considered acceptable to bring this up in salary negotiations and may result in an improvement in working conditions.
Yael Frydman, COO of Route 38, knows almost everything there is to know about employee rights and she shares what you should be aware of.
If you’re just entering the workforce in Israel, you may find that the company culture here is different from what you are used to in your home country. Not every company in Israel is the same, and there are differences between industries and locations, but a group of working women in Israel who belong to the ImaKadima Facebook group have helped us compile a list of characteristics that you are likely to encounter in the Israeli workplace.
Bear in mind that Jerusalem offices tend to be more toned down than offices in the Tel Aviv area. Jerusalem offices are often more heavily religious and that affects workplace culture as well. Some of the characteristics described below are true across the board, while others are more likely to be experienced in the Merkaz (center of the country).
Israel tends to be less formal in general and this is never more true than in the workforce. It starts with the way people dress and talk and even affects management.
Most companies do not have a dress code and casual dress is the norm. There are very few companies where people wear suits to work and many workplaces where jeans and flip-flops are perfectly acceptable.
Israelis tend to speak at work in the same way they speak to their friends or random strangers on the bus. You might be surprised to hear people speaking loudly, very directly and even sounding like they are having an argument, but none of these things are considered rude in Israel. It’s likely that you will be expected to make your opinions known and not beat around the bush.
There is less deference to hierarchy at Israeli companies. Management tends to be more accessible and more open to socializing with employees. Bosses (or their HR departments) often organize mandatory “fun days,” which can be very informal. Alcohol is often served at company events and people are encouraged to let their hair down a bit.
Israeli law requires minimum vacation days, but employers can dictate when those vacation days take place. Some companies have mandatory shutdowns during periods when many employees want to take off or when productivity is low. So you may find that your company is closed on chol hamoed or during the last two weeks of August. In some companies that stay open, there is a much smaller staff since a lot of employees choose to take their vacation days at those times.
A large number of Israelis serve in the military reserves (miluim) until their early forties. So your colleagues might be off of work for an extended period while they are in the IDF.
International travel has become popular in Israel in recent years, and it’s not unheard of for employees to take off for a week or two in order to vacation outside the country.
If you’re used to very strict boundaries between your personal and professional life, aliyah is a good opportunity to let go of them. Coworkers tend to be open about their personal lives, discussing children, spouses and even politics. Colleagues invite each other to family simchas and give each other gifts for events.
Hot topics like politics or religion are not taboo and heated discussions can happen, with everyone still staying on friendly terms. Coworkers may share their feelings and be more free with hugging and kissing. Sometimes personal discussions veer into gray areas, such as asking a woman about her plans regarding getting pregnant. You don’t have to answer any questions that make you uncomfortable or could lead to discriminiation, but it’s best to avoid them elegantly.
In many workplaces, it is acceptable for family and friends to come by to say hello. Even children are welcome in these offices, as long as they aren’t too disruptive.
The Israeli work week is fairly long. A full time job (without overtime) is 42 hours. Many companies work Sunday to Thursday, which translates into nine-hour days. Some companies (and especially governmental institutions) have shorter hours for working mothers.
If you get a job offer with a global salary, this means that you are expected to work overtime. The exact details must be laid out in your contract and adhere to the laws on compensation for overtime.
Some workplaces have electronic time-clocks, where you clock in when you arrive and clock out when you leave. The time clock protects both you and the employer in case of a dispute about work hours. Mas Hachnasa (Israel Tax Authority) requires that hours worked appear on your monthly pay stub.
Salaries are paid monthly (by law they must be paid by the 9th of the next month). This might be a culture shock if you are used to getting a paycheck every two weeks. Most employers will take your bank account information and pay you by direct deposit.
It is common for employers to give their staff presents before Rosh Hashanah and Pesach. These might be gift baskets, housewares or a gift certificate. Some companies allow their employees to choose a gift from a list of options. Other employers will not give gifts at all or will give something symbolic, like a bottle of wine. Note that gifts from employers are often taxable.
Smoking is ubiquitous in Israel and with it cigarette breaks. Coworkers may use their smoking breaks as a time to socialize or to talk business. Lunchtime is also a social occasion at Israeli workplaces. Colleagues tend to eat together, talking, laughing and getting to know each other. Employees may order in, get takeout from a nearby restaurant or bring their own food.
Some companies (especially in the hi-tech industry) provide their employees with lunch cards such as 10bis and Cibus, which give them free meals at certain establishments. (The amount on the cards is considered taxable income, since, after all, there is no such thing as a free lunch.) There are also workplaces which provide catered lunches for their staff. Some even stock the fridge with breakfast foods and snacks, so employees never have to leave the building during the workday.
Israeli employers are generally respectful of family obligations and events, such as bar mitzvahs, britot, weddings and funerals, and will understand when an employee takes off time to attend them. When there is a death in an employee’s family, this will be announced to all the workers and some of them will make the effort to attend the funeral and/or shiva. An employee sitting shiva is legally entitled to all those days off.
Depending on the location and the people who work at the company, the environment might be more or less religious. But even the most secular workplaces are likely to hold holiday parties before major Jewish holidays. Most companies will make arrangements for kosher food at parties and other events if they know that this is important to some of their employees. Even if you are the only kosher-eating person in your office, there’s no need to be shy about asking for consideration of kashrut restrictions. Legally, Jewish holidays on which work is prohibited by Jewish law are considered paid vacation days.
Olim are sometimes surprised to find out that the customer isn’t always right in Israel. This is true as a consumer but also as an employee. You may find that your bosses are working under the impression that they know what’s best, even if customer feedback seems to be saying something different.
Organized methods and deadlines are not always a feature of the Israeli workplace. On the other hand, both management and employees tend to be extremely dedicated to getting the job done, even if it requires working crazy hours or pulling people off other projects to complete a goal.
We already mentioned the lack of formality in speech and this includes using casual army slang and references, swear words and divulging TMI (too much information). Israelis talk fast and interrupt each other and this is not considered rude. They do small talk and Jewish geography, but just as often will cut out the small talk to get to the main point as quickly as possible. Who you know is more important than what you know, so it’s important to establish connections, even if it’s as remote as your niece’s neighbor serving in the army with your colleague’s daughter. And don’t be surprised if your coworker offers to set you up with his best friend’s son.
You may find that your office relies less on email and more on WhatsApp and direct communication. A lot of offices prefer task management apps in order to cut down on email but important information may still be relayed informally. This preference for direct communication leads to meetings which may seem unnecessary to you, but which are considered vital by management.
It will be much easier to get used to the differences in company culture if you come with an open mind and a readiness to learn. Let go of the ideas you brought from your home country and pay attention to how your colleagues behave. Before long, you will find yourself acting like an Israeli and wondering how you ever did business any other way!
Helena Baker of English Speaking Networking shares the do’s, the don’ts and the OMGs of networking, as well as the trials and tribulations of a new olah restarting her career in Israel.
If you’ve owned a business in another country or seen firsthand how a foreign business is managed, you may be surprised at some of the business practices which are common in Israel.
One of the most surprising (and challenging) aspects of doing business in Israel is the concept of shotef plus – delayed payment. Many organizations and businesses don’t pay immediately upon receipt of an invoice. In 2017, a law was passed in the Knesset requiring most institutions and businesses to pay up to 45 days from receipt of an invoice. If you expect payment sooner, this should be included in your service agreement/contract, but don’t be surprised if you are told that the institution simply can’t pay earlier. These payment terms are usually based on cash flow issues (i.e. they are also being paid late), so you may have to accept these terms if you want to work with certain clients.
Acceptable forms of payment are cash, bank transfer and checks. Checks have become less popular in recent years and they aren’t worth the hassle if you can avoid them. Your clients may want to pay with Paypal, Paybox or Bit. Check fees and ease of use to decide which of these you choose to accept. You can also sign up for a paid credit card processing app and accept payments through it. Keep in mind that the easier you make it for clients to pay you, the sooner you will receive the money.
If you supply services or goods to another business, they might ask you for your Nikui Mas BaMakor and Ishur Nihul Sefarim. The Ishur Nihul Sefarim states that you keep your books according to the regulations of the Israeli Tax Authority. Nikui Mas BaMakor instructs the paying entity whether they are required to withhold tax and at what percentage. These documents can be obtained from your accountant or via the Israeli Tax Authority website.
In keeping with the informality prevalent in Israeli culture, business culture can be pretty informal too. Clients often prefer to communicate via WhatsApp or Facebook Messenger and some eschew use of email entirely. If you find that this way of communicating wreaks havoc on your business processes and organization, consider signing up for a task management system. There are lots of free options out there, and you can keep everything organized in one place, regardless of the form of communication utilized by your clients.
Haggling over price is a time-honored Middle Eastern tradition and Israelis are well-versed in the art. You can choose not to work with clients who bargain or you can quote a higher price and expect to lower it in negotiations. In either case, you don’t want to lower your price below what your work is worth or to an amount that doesn’t leave you enough profit after taxes and expenses. A strategy that reduces the chance that a client will haggle is to let them know what they are getting for this price so that suddenly the amount seems low.
Meetings at coffee shops are totally acceptable in Israeli business culture. It’s understood that you may work from home or have an office space that’s not set up for hosting and your client or colleague may be in a similar situation. Etiquette requires that if you are the one who has asked for the meeting, you pay for the drinks or meals. Location should be closer to the person who was invited to the meeting and the initiator should check about dietary restrictions, including kashrut, before choosing a cafe or restaurant.
Most clients will ask you for an invoice before they send payment for a service. An official invoice is called cheshbonit mas, and it obligates the business owner to pay VAT once issued. Therefore, many business owners will send a “drishat tashlum” or “cheshbon iska” which is not an official document, in order to avoid getting stuck with a VAT expense before receiving payment. However, your client may fear making a payment and then getting stuck tracking the official cheshbonit mas. They are allowed by law to request the official, numbered cheshbonit mas before issuing payment and you must provide it.
Some clients are prompt in their payments but others may need a little nudging. Sometimes clients will even ask to pay in installments or reduce the payment that was already agreed on. Stand firm when necessary and choose clients wisely to avoid these issues as much as possible.
Once payment is made, if you are an Osek Patur, a receipt (kabala) is issued. If you are an Osek Murshe, you will need to issue a cheshbonit mas, which is a legal document and must be numbered. The ORIGINAL is what has value, so when using officially printed books the original document must be given to the payee. A digital copy is not enough for the payee to claim the VAT back on the expense.
In many cases, especially when funds are exchanged at the time services are provided, these documents are issued together in what’s called a cheshbonit mas kabala.
If you are using an electronic invoicing system, it’s easiest to create the payment request in the system and transform it into a receipt once payment has arrived.
Receipts are legal documents and it’s important to use a government-approved electronic system or an official printed booklet. Clients generally prefer to receive receipts electronically, so if you use a printed book, take a picture or scan it to send immediately and then send the paper one in the mail afterwards.
In some countries, the lines between work and life are sharply defined, but they are a bit blurrier in Israel. Business owners may tell you why they can’t provide a service as quickly as they usually do – for example, they are taking a vacation, their baby is sick or they are dealing with a family crisis. It is assumed that you will be understanding, and that, if your project isn’t urgent, you will wait a little longer. If you feel comfortable, you can also let clients know how life events affect your productivity. Constant excuses won’t go over well, but an occasional hiccup is understood and accepted.
One of the things you learn quickly in Israel is flexibility. Plans tend to change at the last minute, rules aren’t necessarily law and the food tastes nothing like it did in your home country. At the beginning of life here, these things can be frustrating, but soon you will start to see the benefits of agility and adjustment.
One of the ways in which Israelis are flexible is in the definition of their careers. There are many Israelis who have one conventional career and stick to it, of course. But there are also a lot of Israelis who work more than one job in order to make a living. There’s the office worker who teaches exercise classes in the evening, the teacher who tutors on the side and the translator who also runs a marketing business, to name a few.
When you have two (or more) jobs, there are some Israeli laws you need to be aware of.
If you are a salaried employee, the Income Tax Authority (Mas Hachnasah) provides guidelines to your employer for how much tax to withhold from your salary. Without instruction from Mas Hachnasa, when your employer becomes aware that you are receiving another salary, they are obligated to withhold the maximum amount of taxes.
In order to prevent most of your income going to taxes, you need to coordinate your income tax in a process called Teum Mas. You can apply for a Teum Mas online by providing information about your income sources, although it may be worth your while to stop by your local Mas Hachnasa office and walk it through with an agent. This may take more time, but oftentimes saves headache down the road due to misunderstandings or typos. You will need certain details from your employers, such as their Mispar Tik Nikuim (payroll tax number) and your expected annual income. Register at the Income Tax Authority in order to access the form for Teum Mas. The Teum Mas will arrive within a week or two of applying and you should then send this report to your payroll or HR department so they know the proper amount of taxes to be withheld.
In some cases, you may also need to communicate your dual income to Bituach Leumi. If you didn’t do so and you overpaid, you can request a return.
Working a second job doesn’t disqualify you from unemployment benefits. If you worked for two employers and one of them laid you off, you can continue to work at the second job and collect unemployment from the first one if you qualify. Your benefits will, of course, be lower than if you were laid off from your only job and were no longer working at all. You’ll need to submit pay stubs from your employer each month.
If you have multiple clients and don’t receive a salary, you must open a business with independent contractor files at the VAT office, Income Tax Authority and Bituach Leumi. You report your income and pay income tax, Bituach Leumi and VAT (if relevant) according to your total income from all your clients. This involves paperwork and it is recommended that you hire a tax consultant (Yoetz Mas) or accountant to help you with this.
It is also possible to receive a salary from an Employer of Record such as Route 38. In that case, the clients pay the EOR and you receive a salary based on revenue collected. Payments and taxes are automatically withheld, just like they are for every other salaried employee.
If you’re supplementing a salaried job with a side business, you need to open files with the VAT office, the Income Tax Authority and Bituach Leumi. Your payments to Bituach Leumi will be deducted automatically from your salary and additional payments will be owed from your freelance income, taking into account what you have already paid as a salaried employee.
As a freelancer, you are required to report your income to the Income Tax Authority. There is no need for a Teum Mas, unless you have more than one salaried position in addition to your freelance earnings. When filing your end of the year report, include your income as a salaried employee so your income tax is calculated correctly. This report should also include funds deducted from both the job and the business for pension or Keren Hishtalmut (education savings fund), as they will reduce your taxable income.
Israeli employment law protects pregnant women in several ways. In fact, there are some benefits that start even before pregnancy if a woman is undergoing fertility treatments. Full days off for fertility treatment are treated as sick days and individual hours can also be deducted (up to 40 hours a year for a full time employee). A woman cannot be fired or have her salary changed during an absence due to fertility treatments.
A woman is obligated to inform her employer of her pregnancy during her fifth month. Likewise, a woman who is hired at a new job while pregnant doesn’t have to disclose her pregnancy prior to accepting the job, unless she has reached month 5. Some women choose to let their employer know earlier, either because they are feeling sick and may not be performing at optimal level or in order to give their bosses more time to find a maternity leave replacement. The law allowing women to wait till five months protects them against discrimination, so each employee should consider carefully when the best time to disclose a pregnancy is.
Discrimination against pregnant women, in the hiring process or in the workplace, is illegal. A woman who was discriminated against can sue her employer in the labor court. This includes a prohibition of firing a pregnant woman because she is pregnant. If a company wants to fire a pregnant woman for a different reason, and that woman has worked at the company for more than 6 months, the employer must obtain special permission to fire her. A common case would be a company that is laying off many workers due to budget cuts and wants to include a pregnant woman in the general layoff. If a pregnant woman was fired without special permission, it is considered as if she was never fired.
Employers are also prohibited from lowering the salary or work scope of a pregnant woman, regardless of how long she has worked at the company.
It is prohibited to require a pregnant woman to work overtime or night shifts. However, she can work overtime if she has consented in writing and provided a letter from her OB/GYN that there is no need to refrain from overtime. A woman can be asked to work at night (at least two hours between 10 PM and 6 AM) but she is within her rights to refuse in writing.
If a woman has a documented high-risk pregnancy and is absent from work for 30 days or more, she is entitled to a Bed Rest Benefit from Bituach Leumi.
A pregnant woman can be absent from work for routine pregnancy tests for up to 40 hours (for a full time employee). These hours are paid for by the employer as if she worked. A part time employee is entitled to this benefit as well, relative to the number of hours she works on a regular basis.
The spouse of a pregnant woman is entitled to use 7 days of their sick days due to her pregnancy or childbirth. This includes accompanying her to appointments and being present for childbirth. He can also utilize 3 vacation days after the birth of the child. If he wishes to take 4 or 5 days, those extra two days can be considered sick days. These days are not considered maternity leave and don’t negate the spouse’s right to split maternity leave with his wife.
For more information on the rights of pregnant women in the workplace, see the Kol Zchut website.
Shuey Fogel of Fogel CFO & Management Services gives some of the best advice you will ever get about aliyah, opening a business in Israel and pivoting your career. You’ll also hear how a bloody nose in a basketball game can change your life and how a book signing can make a lasting impression.
CFO Baruch Swinkin talks to financial consultant Rifka Lebowitz, about the opportunities and challenges of aliyah. Rifka reveals some of the results from her recent survey and Baruch tells us what happened when he accidentally told someone he was a taxi driver.
In his incredible commentary on Rav Kook’s Orot HaTeshuvah, “Song of Teshuvah,” Rav Moshe Weinberger brings to light Rav Avraham Yitzchak HaKohen Kook’s groundbreaking approach to the concept and process of repentance. Rav Weinberger cites over and over again Rav Kook’s message that repentance is not intended to be a burdensome process, rather a joyous, restorative process. As our Sages state, the creation of repentance preceded the creation of the world and represents our soul’s desire and yearning to return to that point, to a place in time where there is an understanding and appreciation for Truth, to a place and time before the veil of the physical world shrouded us and obscured us from that Truth. It’s a healing process and not a punitive process. Kaparah is classically translated as atonement, but it literally means to wipe away. We are literally cleaning our souls and we should approach the repentance process not with trepidation, but with enthusiasm. It is a hard and rigorous process, but it should be embarked upon with a sense of renewal and hope.
Additionally, a person’s desire to make the world a better place and specifically any activism, advocacy and efforts in the advancement of the Jewish people is a form of repentance. The Jewish people are different from any other nation. We are made up of individuals, but our heart also beats as one. When any part of the nation is suffering, we all suffer. We see examples of this all the time. Therefore, when one takes the lead in improving the lot of the nation, in any way, they are actively engaged in bringing us back to our original pure state, which is the essence of repentance. Every person who leaves his or her home country, makes aliyah to Israel and contributes to the welfare of the Jewish people and its homeland is engaging in a form of repentance.
The beauty is that Hashem created lots of us, each with our own personalities, character, strengths and weaknesses. We see this clearly in the myriad ways that you – our clients – choose to serve the Jewish people and boost the Israeli economy. No matter how you look at yourself, as long as your focus is on doing good, you can take whichever approach fits you best. Or, more practically, blend of approaches. As long as we recognize our True purpose in this world, we can then go about the process of working on ourselves in whichever way speaks to each of us.
5780 was really challenging. COVID hit us like a brick wall. We had hoped for better in 5781. And in some ways it was. Because we learned to cope with this ever changing pandemic. But we also suffered tremendously as a nation. The losses that we endured this year were obviously meant as messages to us. Without a prophet, there is no way to know what that message is, but it’s clear that we have lots of work to do. If everyone takes upon themselves to make 5782 a year of repentance, step by step, day by day, baby steps each day – a year of positivity, a year of growth, a year of unity – not just 10 days or one month, but an entire year, then hopefully we can stand together on the eve of 5783 with a real call for everyone to return to our home in the land of Israel.
We wish you a shanah tovah umetukah, a year of blessings and success, a year of health, of endless nachas from our families and only joy, a year in which all our wishes come true.
The Route 38 Team
One of the great things about living in Israel is that there are endless ways of making a living. Olim are often surprised to discover that their new neighbors are working in many different types of jobs and that they are not necessarily working full-time jobs at established companies. They may be freelancers, small business owners or founders of start-ups. The Israeli economy and social structure promote creativity, flexibility and out-of-the-box thinking about careers.
You don’t always have a choice on how to structure your career path, but there are some circumstances in which you will have to choose whether to be an employee, a freelancer or a business owner:
Here are the some of the differences between employees, freelancers and business owners:
| Employee | Freelancer (atzma’i – osek patur or osek murshe) | Business owner (b’am) |
| Taxes and social benefit obligations are deducted automatically | Taxes and social benefit obligations are paid independently | Taxes and social benefit obligation payments are set up as automatic deductions by the company accountant |
| Minimum sick days and vacation days provided by law | No sick days or vacation days | You are your own boss. You make the rules. |
| Keren hishtalmut savings plan may be included | Keren hishtalmut savings plan can be set up independently | Keren hishtalmut savings plan can be set up via the business |
| US citizens will not owe a 15% Social Security (FICA) tax for filing as an independent contractor | US citizens will be taxed 15% of their income to Social Security | US citizens will not owe Social Security |
| No accountant needed to file an annual return, assuming no other reportable income | Accountant strongly recommended for the end of the year report. Osek murshe has additional, periodic reporting requirements over the course of the year (best done with an accountant). | High accounting fees. Monthly, bi-monthly and annual reporting requirements |
| No additional administrative or accounting responsibilities | Minimum level of administrative responsibilities in addition to tax reporting responsibilities indicated above | Significant additional administrative responsibilities and required understanding of Israeli corporate income tax requirements in addition to tax reporting responsibilities indicated above |
| Receives maternity leave and maternity payment (after accrual of minimum required months on payroll) | Receives maternity leave and maternity payment (after accrual of minimum required months reported) | Receives maternity leave and maternity payment (after accrual of minimum required months on payroll) |
| Work schedule determined by employer | Self-determined work schedule | Self-determined work schedule |
| Payment generally deposited directly into employee’s bank account | Payment collected directly from client(s) | Payment collected directly from client(s) |
One of the reasons that we founded Route 38 was because being an employee in Israel is legally and financially simpler than being a freelancer or opening up a company. We are the employer of record for people who work for foreign companies or provide services to clients and are not employed by another Israeli company. Our solution allows people to focus on their work without spending time and resources on collection of funds, paperwork and government reporting. In many cases, the employees retain control over their schedule and choose which projects they want to work on, while enjoying the benefits of an Israeli pay stub.
There are career paths which don’t lend themselves to the Route 38 employer of record service. In fact, every case is different, and professional advice is highly recommended before making a choice that has long-term effects. We provide objective and professional advice to help you make the choice that’s best for you. Email us at info@route38.co.il with information about your situation and we will get back to you as soon as possible.
Mazel tov on your new baby! In between changing diapers and feeding this adorable munchkin, you may be worried about how you receive your maternity leave benefits. The good news is that you probably don’t have to do anything to make that happen, but of course, there are some exceptions.
Maternity leave refers to the amount of time your employer is obligated to hold your job for you. If you have worked for a year for the same company, you are entitled to a maternity leave of 26 weeks, only some of which is paid. If you have worked for your current company for less than 12 months, you are entitled to 15 weeks of maternity leave, all or some of which is paid. Your employer cannot prevent you from taking maternity leave or begin the termination process for a period of 60 days after your return.
If you were employed by the same employer for a year before becoming pregnant, you will have pensions contributed on your behalf for the first 5 weeks of maternity leave. You must also deposit 6% during this time (usually laid out by the employer and deducted from your pay upon your return to work).
If you’re self-employed, you don’t need anyone to hold your job, so this is not relevant to you, but you do receive maternity pay from Bituach Leumi.
A woman who worked 10 out of 14 months or 15 out of 22 months prior to her birth is eligible for 15 weeks paid maternity leave from Bituach Leumi. A woman who worked 6 out of 14 months prior to her birth is eligible for 8 weeks paid leave.
According to the Kol Zchut website, “The maternity allowance is computed per day according to the gross salary of the employee in the three months preceding the first of the month in which the leave began, divided by 90, or according to the total income in the six months which preceded that day, divided by 180 (whichever is higher, up to the maximum established amount).”
If you’re self-employed, payment is based on the three months preceding your maternity leave or the same three months in the previous year, whichever is higher. If you’re both a salaried worker and self-employed, maternity pay will be based on both incomes.
If you’re a salaried worker and your employer has an arrangement with Bituach Leumi, you will automatically receive your maternity pay in a one time payment during your maternity leave. If you are self-employed, you will get a payment based on your advance payments to Bituach Leumi and adjustments will be made later if necessary. If you were receiving bed rest benefits or unemployment, you will also receive your maternity pay automatically.
If you don’t fall into any of these categories or you gave birth at home and not in the hospital, you will need to file a claim with Bituach Leumi. This can be done up to 9 weeks before the due date by mail, fax or at a local branch, or after birth online. These are some of the documents you may need:
In most cases, maternity pay arrives automatically in a new mother’s bank account. If you fall into one of the categories that require filing, the process is fairly transparent and shouldn’t be too difficult. You’ll have plenty of time to focus on yourself and your new baby.
Baruch Swinkin, CFO of Route 38, talks aliyah, succeeding financially and mountain biking as he explains what Route 38 is all about.
Financial advisors will tell you that pensions are just as important as salaries, and for good reason. Although it seems counter-intuitive, retirement expenses are just as high if not higher than what you are spending now. This is because of new expenses such as medicine and medical treatments and increased spending on things like transportation and food. Taxis often replace driving, busing or walking and the ability to get to discount stores may be curtailed. Some retirees are still marrying off children or helping out their young adult kids. And basics like phones, electricity and home maintenance don’t change.
That’s why smart financial planning includes planning for retirement and luckily, the Israeli government has regulated this so that every citizen has some form of pension.
All citizens who have contributed to Bituach Leumi for 12 years are eligible for a state pension. Israeli residents start paying into Bituach Leumi at the age of 18 (unless they are in the army or National Service). If you are working, this payment is deducted automatically from your paycheck. If you are a business owner, the government collects this payment from you directly. The basic pension starts at 1,558 NIS a month per person and 2,430 NIS for a couple, so while this is a nice amount to have, it’s not going to go very far in covering your living expenses. Furthermore, the amounts paid out by Bituach Leumi might be reduced due to actuarial issues.
Your employer is obligated to set aside at least 6.5% of your salary or the average wage in the economy (whichever is lower) every month for pension insurance. You also pay into the insurance, at the rate of 6% of your salary.
Your employer is also obligated to set aside severance pay to the amount of 6%, or 8.33% if you have signed a Chapter 14 clause. A Chapter 14 clause states that the employee is entitled to receive exactly what is in the fund (no more and no less) at the time of termination, regardless of whether the parting of ways was initiated by the employee or the employer. If you don’t use your severance pay, it becomes part of the pension paid out to you in retirement.
Just like Bituach Leumi, employees have their pension deducted automatically from their paychecks, while business owners have to set this up on their own.
Many companies choose a pension provider for their employees and this may result in one person having several pension plans. In recent years, the government has mandated that an employee can choose which plan he wants to contribute to, regardless of the company’s official provider. So if you get a new job but already have an existing plan, you can continue to contribute to it and don’t have to open a new one.
If you do have multiple pensions, check whether you are paying fees on each one. If that’s the case, you may be better off consolidating them into one, although there are cases where it makes sense to keep them separate. If you merge the plans, make sure that your pension is now being paid into the consolidated plan.
It’s important to check that your pension is actually being deducted, because if a mistake is made you may find yourself suddenly losing most of your salary to a retroactive pension payment.
In general, we recommend looking at your payment stub (tlush maskoret) carefully each month, to check that everything is in order. Payroll mistakes can happen and if you’re only looking at the final number at the bottom, you may miss them.
There are many pension providers and it can be extremely confusing to understand the differences between them. Revenues, management fees, level of investment aggression, annuity vs. lump sum payments, various insurances connected with the policies and more differences need to be taken into account when choosing a plan. To complicate matters further, insurance agents are often representatives of one specific company, so they aren’t giving you objective advice.
If you’re starting fresh or want to switch pension companies, it is advisable to consult with an independent insurance agent who can explain what your options are and recommend a plan that meets your needs.
Thank you to Motty Handler, registered insurance agent, hmotty@gmail.com, for his help in writing this article.
As telecommuting has become more prevalent around the world, more American companies have begun to hire people in Israel to join their staff. There are four main reasons why companies choose to do this.
Israel is called the Start Up Nation because of the ingenuity and talent of its best and brightest. Many Israelis have learned specialized skills during their army service and have been taught to think out of the box and dream big. Companies looking for exceptional talent will often find it in Israel. This is especially true in the hi-tech industry but by no means limited to it.
Israeli salaries tend to be slightly lower than American ones, so it can sometimes be less expensive to hire someone in Israel to do the same job. Of course, salary is very much dependent on industry and experience, and not every Israeli will work for a lower salary than his or her American counterpart.
Certain industries, such as medicine and customer support, require staff to work overnight. Israel is 7 hours ahead of the US, so an Israeli employee can provide services during his daylight hours while his American colleagues get a good night’s sleep.
For instance, JTA reported that Dr. Warren Isakow, an intensive care physician, works from 4 AM to 4 PM Israel time for hospitals around the US. Using software developed for this purpose, he directs procedures from his home office in Modiin, Israel, half a world away.
Another reason that American companies employ Israeli workers is that they had an excellent employee who wanted to move to Israel and they didn’t want to lose him or her. Instead of giving up on an outstanding asset, searching for and training someone new, they prefer to switch to a remote work arrangement with their current staff member. This arrangement is often mutually beneficial to both employer and employee and can last for many years.
Outsourcing to Israel has all the advantages listed above but it also comes with challenges. These are some of the issues to consider:
An American company hiring an Israeli must take into consideration that the Israeli government may call this an Israeli office and tax the company accordingly. Some companies solve this by having the employee set himself up as an independent contractor or business owner in Israel, with the American company billed as a client.
An arrangement where the employee becomes an independent contractor is beneficial to the American company, but it comes with serious drawbacks for the employee. This is because American citizens residing outside of the US are still obligated to file taxes and will have to pay 15% Social Security as independent contractors. Many dual citizens will balk at this arrangement and prefer to work for an Israeli employer in order to avoid these payments.
A less expensive and more efficient solution to this problem is to hire Route 38 to provide services to the American company. A dual citizen wishing to work for this company becomes an employee of Route 38, which pays his salary and deducts all the taxes and payments required by the Israeli government. This is a win-win, because the employee doesn’t owe Social Security to the US government and has a smoother transition into Israeli life, while the American company doesn’t have to open an entity in Israel, with all its implications.
Remote work is a different animal than office work. Particularly at the beginning, it may be difficult to communicate effectively in order to get things done efficiently and well. This problem is exacerbated by the time difference. Luckily, technology has advanced enough that task management software, virtual meeting platforms and social media make it easier to stay in touch. The 7-10 hour time difference does allow for some overlap between American and Israeli work hours, and Israelis are often flexible with their schedules in order to accommodate their overseas colleagues.
Is outsourcing to Israel a good idea? If the last few years have taught us anything, it’s that agility and flexibility are key to a successful business. If a company can tap into new talent pools, save money, cover nighttime hours or keep a good employee, outsourcing to Israel is certainly an excellent option.
The 9-5 office of the past has gradually transformed into a much more fluid work environment, in which remote working has a place of honor. There are, of course, jobs that can’t be done remotely, and employers who don’t allow it even though it could technically work, so remote working in Israel isn’t an option for everyone.
But if you’re thinking about aliyah or are considering a career change in Israel, remote work might be on your radar. Let’s start with the ways it can be awesome:
Not everything is rosy in the world of remote working, of course. Here are some things to consider that make working remotely a little less attractive:
We’d love to hear from you. If you decided to work remotely, what were the deciding factors? What do you miss about working in an office and what aspects are you glad to be rid of?
The change in lifestyle and culture that the pandemic has brought to the world has brought much chaos and challenge to the world. But change also creates opportunity. One such opportunity that now exists is for employees to follow their dreams and move to locales never before possible while continuing to work remotely and provide even better service to their employers with a balanced work/life model that fits their needs and keeps them satisfied and eager to prove themselves. Working remotely from Israel with a 7-10 hour time difference to the States has now become acceptable and brings about a preferred lifestyle for many.
If your employee would like to move to Israel, there are three ways that this can be accomplished.
The first option is that the employee continues to work for their US employers as a W-2. This option would require the employer to open a tax file in Israel – not a highly recommended course of action for any company who does not want to create nexus in a foreign country.
The second and more feasible option is for your employee to open a personal tax file as an independent contractor, requiring the service provider to hire an accountant to open the files with the relevant authorities and file an annual return, along with a small handful of other possible other reporting obligations. It’s pretty straightforward and may not take much time, but it can still be a burden on your employee. The financial downside to this approach for Americans is that, as they are reporting as an independent contractor, they will be required to report as such in the US as well, kicking in a 15% flat Social Security tax, that is not covered by the US-Israeli tax treaty, nor can any deductions be taken. Your employee may very well be reluctant to choose this option, due to the burden of reporting in Israel and paying Social Security in both countries.
The third way to continue to employ an Israeli resident is through our payroll service. Our service allows your employee to continue to work for you, but as an employee of our company, Route 38 Professional Services LTD. The benefits are that we take care of all of their accounting requirements here in Israel, helping them to continue to work seamlessly with you. Additionally, as an employee of our company (even though it is a foreign company) when the individual files their US return, they will no longer be liable for the Social Security tax.
Our association with your organization will be through our US company, Route 38 LLC. This allows us to have a completely domestic relationship and act as a straight 1099. We invoice on a monthly basis and you can pay us via our BOA account using most electronic means.
A brief run-down on mandatory Israeli employer costs might give you some reference point on the cost of employing someone in Israel. They are as follows:
– National insurance – approximately 7%-9% of gross salary
– Pension – 6.5% of gross salary
– Severance – 8.33% of gross salary
There are also a couple of optional benefit options, primarily a study fund benefit in which you could add an additional 7.5% of gross salary for funds to be deposited in an investment vehicle that can be tapped into after 6 years.
You should also be aware of certain differences in employment law in Israel versus the US – specifically protections for employees for termination (a hearing needs to be proposed and happen and only after that can an up to 30 day notice period start) and maternity (pregnant women can almost never be terminated, job must be available upon return from leave and employer cannot start the termination process with the employee for at least 60 days upon return.)
If there is any other information that we can provide, feel free to reach out to us at Route 38: info@route38.co.il. We look forward to hearing from you.
I have a somewhat quiet passion for puzzles. My family just finished a 3,000 piece puzzle. It took around four months and lots of time spent trying to jab pieces into places that just didn’t fit. Some pieces you just know are supposed to go in certain spots and you try dozens of times to make them fit…to no avail. It’s only when the puzzle is complete that you can look back and find those “trouble” pieces and see that they actually belonged somewhere completely different. Sometimes, you can struggle to find one piece for days, and then someone else comes in and in twenty seconds, they say, “Were you looking for this?” With a look mixed with incredulousness and self-doubt you sheepishly respond “Uh, yeah…”
Life is obviously one huge ever growing puzzle that we are constantly trying to get ahead of and complete. There are some challenges that interlock neatly and we are able to move on from quickly and effectively and there are some challenges that we keep on trying to solve the same way over and over and over, until finally, we figure out that our approach was completely wrong.
Making a living is a challenge that is constantly evolving and requires constant energy and focus. We are given many hundreds of “pieces” – resources and assets – in order to complete the puzzle. They are all multi-colored and many do not seem to fit anywhere and are left unused for long periods of time. We sometimes try to use the same resource, the same mindset over and over again and can’t figure out why it doesn’t “fit.” Oftentimes, we need to stand back and look at the picture from afar to see that we were way off in our assessment and we need to recalibrate. Many times, we need an outside perspective to come in and direct us to where that piece should have gone the whole time.
The world is rapidly changing and more and more people are starting to think about coming home. The aliyah process is a ginormous puzzle, with dozens, if not hundreds, of moving parts. One of the biggest sections of that puzzle is making a living in Israel. At Route 38, we can help you recalibrate your focus. Maybe the piece that you have been searching for is right under your nose.
Could I really, possibly keep my job and just continue to work remotely (now that the pandemic has proven that it’s possible)? What are the ramifications for my employer and for me? How do I report and pay my taxes in either country? How do I approach my employer? What tools do I need to make this happen? If I absolutely cannot bring my job with me, what is the business landscape like in Israel? How do I operate a business? If I am looking for a new job, what do I need to know? What is accepted and how do I know that I am not being taken advantage of?
There are so many questions. Route 38 has the answers. Our team of experienced American-Israeli professionals can help guide you through these concerns and map out a plan. Our vast network of service providers in dozens of industries can answer your industry-specific questions. We will give you the tools to take a step back and make guided informed decisions in order to complete the backbone of your aliyah parnassah puzzle. Contact us today to schedule an appointment.
As we all know, everyone falls and makes mistakes. The Talmudic commentator Rabbeinu Yonah points out that it’s one’s reaction to those transgressions that makes the person. If a person’s attitude is of horror and shame and he does teshuvah (he repents) then he has learned from his sin and will actually grow from it. If his reaction is – “this is cool, I’m going to try again,” or “I just can’t deal with this desire or need and I am just giving up on this battle,” well, for that our sages have some pretty tough words.
G-d knows that he created us as fallible human beings. We make mistakes. We have our ups and downs. We are going to trip and do things that we are not proud of. That’s not good, but it’s acceptable, as long as we learn from those mistakes and grow from them. Hashem wants our hearts. He wants us to be focused on the true purpose of our existence, the true essence of our being, which is to serve him, build positive loving relationships in this world and create and build lasting sustainable good. That is what He desires from us. Those are all part of a long journey, replete with hiccups along the way. If we stumble and get back up, we are viewed with the same loving kindness. If we fall and sink, Hashem still gives us an opportunity to get back on track, but we are now going to have to work much harder to get ourselves there.
Elul and Tishrei are usually times to look back at the year and focus on many of the things that we would like to change. 5780 was really, really challenging (understatement of the year). Many lost loved ones after long and protracted battles. Many went through their own health battles, whether COVID-19 related or not. Many lost their livelihoods or faced extreme uncertainty as to how they were going to move forward. Many had ambitious projects and plans that were collateral casualties of the pandemic. Anxiety and depression were probably more common than not. And no one has any idea what tomorrow or next month or 5781 will bring. We’ve all made some mistakes and said things that we really would like to take back. Many of those were born out of maddening frustration and dread.
But introspection also requires us to look back and appreciate all of the good that happened in 5780. We had the opportunity to really focus on our families. We remembered both the importance of our community, but also that we are individuals who can manage on our own. Many that were not able to be with their children received constant reminders of their families’ love. Zoom made us want to throw away our computers, but also brought family reunions with long lost cousins that we had not connected with in years. We had opportunities over the year to do things we never thought possible. Many began to realize that the borders of Israel were closed and began the journey of planning or at least considering Aliyah so that they could be inside instead of out. Countless acts of tzedakah and chesed that never would have come to the fore were enabled by the challenges that we faced. Many difficult interpersonal relationships were mended. And on and on.
See, we can focus on the daily drama and challenge and reflect on 5780 as a nightmare. Or we can choose to focus on what went right. We can focus on our overall outlook.
We generally focus during this time of year on all of our faults. We do still need to work on those. But maybe it would be healthy this year to focus on all of the good that we have accomplished. Not to be haughty. But to present to Hashem – See? I’m growing. I’m learning. I’m striving. I’m doing my very best to fight through the hurdles that You have presented me so that I can be the best spouse, parent, sibling, friend, neighbor, community member, Jew that I can be. Here are my credentials. Please allow me to continue on this path, only maybe lighten up the hurdles in 5781. Please. I might stumble again, but I will not waiver in my commitment to You. Because ultimately, this is what Hashem wants from us.
We wish you a sweet new year, full of blessings, success, health and joy from your family. May this be the year that the entire Jewish people find their home and livelihood in Israel.
Whether you have lived in Israel for a number of years, are considering aliyah or are packing up to make the big move, one of your biggest concerns is surely how to make a good living in Israel. Stanley Fisher, former President of the Bank of Israel, famously remarked that he couldn’t understand his own salary slips. Salaries in Israel are made up of a number of components and understanding them is key to analyzing your financial situation.
Let’s clarify some of the basic terms that are used to describe the required and optional tax and social benefit obligations in Israel.
Ø Bruto – Gross salary. Generally the base salary that is offered to you in a contract.
Ø Neto – The amount of money actually deposited in your bank account on a monthly basis, after deductions of income tax and other required payments are removed. Note that the Israeli standard is to be paid monthly, not bi-weekly or bi-monthly.
Ø Mas Hachnasa – Income tax. Incurred at a graduated rate. Income tax is removed automatically from your salary, and in most cases, there is no need to file taxes at the end of the year. Income taxes are calculated on an annual basis, yet paid out on a monthly scale. We will dissect this area in a later post.
Ø Bituach Leumi – National Insurance coverage. Often compared to US Social Security benefits, but they are actually very different. (I’ll compare these two institutions in a future article.)
Ø Keren Pentzia – Pension fund deposit. This is a mandatory benefit requiring the employer to pay a minimum of 6.5% of the monthly bruto total and the employee to deposit a minimum of 6% of bruto. Each employee has the ability to choose the investment option they prefer. This will also be the subject of a later post.
Ø Kupat Gemel – Mutual fund investment. Similar to a pension fund in structure and purpose, but not mandatory.
Ø Bituach Menahalim – Pension for managerial positions and above.
Ø Keren Hishtalmut – Translated as a “Study Fund.” The initial purpose was for an employee to accumulate a base in order to apply for continuing education. In reality, it now acts as an additional, optional short term tax free savings vehicle. Some employers offer this as an added benefit, but it is not available across the board.
Ø Ovdan kosher avodah – Additional, optional long term disability insurance. This perk is generally only offered in the hi-tech sphere.
When you are offered a job in Israel, you will be told what the bruto salary is and what additional benefits (if any) are provided. An employer will not be able to tell you what your neto take home pay will be, since this is based on many factors outside his control. You can get an idea of what your neto salary will be by using this calculator.
Got any more questions about how your neto salary is determined? Comment below and I will respond.