Knesset Advances Legislation to Reimburse Employers for Reservists’ Pension Payments

The All-Israeli Association of Trade Unions, Histadrut, has made a plea to Deputy Israel Eichler, the Chairman of the Parliamentary Commission on Labor and Social Security, to take action on a bill that would reimburse employers for the pension contributions of workers called up for reservist duties. This initiative was spearheaded by Yossi Barabi, the head of the trade union representing employees in security companies, cleaning companies, and elderly care companies.

Barabi’s bill aims to address a gap in the National Insurance Law that currently compensates reservists based solely on their “gross” salary without taking into account any additional social conditions paid by their employers such as contributions to the pension fund, severance pay, vacation pay, health benefits, and sick days. These non-reimbursable costs can amount to 22%-36% of an employee’s salary.

The issue is particularly pressing in the field of safety and security where approximately 100 thousand people are employed and at least 20% of them are called up for reservist service. For security companies, paying 25% of the salaries of 20% of their workforce is a significant financial burden that can threaten their profitability.

This proposal is supported by both Ministers of Labor and Defense who recognize the importance of ensuring that workers who sacrifice their lives for their country are fairly compensated. The Ministry of Finance and Defense have been tasked with formulating legislation before two weeks or else Barabi’s bill will be tabled in Parliament.