Israel Operating a Business

flag Israel Israel: Operating a Business

In this page: Legal Forms of Companies | The Active Population in Figures | Working Conditions | The Cost of Labor | Management of Human Resources


Legal Forms of Companies

Public limited company (business corporation)
Number of partners: minimum 2 partners
Capital (max/min): no minimum capital
Shareholders and liability: liability limited to the amount of contributions in share capital.
Limited Liability Private Company (SARL)
Number of partners: No minimum
Capital (max/min): no minimum capital.
Shareholders and liability: liability limited to the amount of contributions in share capital.
General Partnership
Number of partners: minimum 2 partners in partnership.
Capital (max/min): no minimum capital.
Shareholders and liability: unlimited liability for debts and obligations of the company.
Enterprises Federation

Business Setup Procedures

Setting Up a Company Israel Middle East & North Africa
Procedures (number) 5.00 8.00
Time (days) 21.00 23.00

Source: Doing Business.

For Further Information
Consult Doing Business Website, to know about procedures to start a Business in Israel.
The Competent Organization
Registrar of Companies, Ministry of Justice.

Recovery Procedures

Enforcement Law in Israel is often criticized. The creditors argue that the system is inefficient and does not provide legal instruments for collecting debts.

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The Active Population in Figures

Labor force 3,492,0003,269,0003,493,000

Source: CIA - The world factbook

Total activity rate -57.10%57.30%
Men activity rate 62.50%62.40%62.40%
Women activity rate 51.90%52.50%52.50%

Source: UN - United Nations

Employed Persons, by Occupation (% of Total Labor Force) 2008
Manufacturing 15.2%
Real Estate, Renting and Business Activities 14.0%
Education 12.6%
Health and Social Work 9.9%
Transport and Storage 6.3%
Construction 5.4%
Hotels and Restaurants 4.7%
Agriculture, Hunting and Forestry 1.7%
Households with Employed Persons 1.7%
Electricity, Gas and Water Supply 0.7%
Mining and Quarrying 0.2%

Source: International Labor Organization (ILO)

For Further Statistics
Bureau of statistics
For Further Information About the Labor Market
Labor market database

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Working Conditions

Opening Hours
  • Legal Weekly Duration
Maximum 45 hours per week
  • Maximum Duration
8 hours per day with a break of 3/4 hours out of which 1/2 hour for meals.
  • Night Hours
Between 22:00 hours and 06:00 hour.
Working Rest Day
Saturday, the Shabbat is the legal weekly day off (waiver for non Jews).
Paid Annual Vacation
Between 14 and 28 days of annual paid leave (based on seniority) the holidays corresponding to Jewish and national festivals are added to this.
Retirement Age
From 60 to 65 years for women and from 65 to 70 years for men.
Child Labor and Minimum Age For Employment
16 years (14 years for vacant jobs).

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The Cost of Labor


Minimum Wage
ILS 4,100 per month (source: ILO, 2011).
Average Wage
Gross average monthly wage of men: ILS 9,720 (source: ILO, 2010);
Gross average monthly wage of women: ILS 6,386 (source: ILO, 2010).
Other Forms of Pay
  • Pay For Overtime
125% for the first two additional hours, 150% for the hours which follow.
  • Pay For Rest Days Worked
  • Pay For Night Hours
from 16 years between 2200 hours and 0600 hours on the following day, 7 hours per night
  • Pay For Overtime at Night
125% for the first two additional hours, 150% for the hours which follow.

Social Security Costs

The Areas Covered
All the Israeli residents are insured with Bitouah Leumi (Social Security) who are salaried, independent, retires, students or unemployed aged 18 to 60 years (65 years for women). The sectors covered are : maternity, industrial accidents, family allowances, unemployment and retirement.
Contributions Paid By the Employer: 6.5%
Contributions Paid By the Employee: 9.70%
Competent Organization
Bitouah Leumi (Social Security)

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Management of Human Resources



Method of Recruitment
The candidatures are made more and more through the internet.
Recruitment Agencies
Recruitment agencies : Get a Job in Israel, Amal, Jobtov, Enosh, ORS, Dan HR, Tafkid Plus, Kedumin, Manpower.


Recruitment Websites
Jobs in Israel

The Contract

Type of Contract
The employment contract is drawn up through legal provisions and to a lesser extent through collective agreements. The employment contract can be written or oral. It can be for indefinite, definite or temporary duration.

Breach of Contracts

  • Retirement
The retirement generally takes place at 60 years for women and 67 years for men.
  • Dismissals
Dismissal does not have to be justified in Israel. However, there are limits as for example the case of a pregnant woman who has reported her pregnancy or the period which directly follows her return to work.
  • Other Possible Methods
Labor Laws
Labor Law on the website of the Ministry of Industry, Trade and Labor
Consult Doing Business Website, to obtain a summary of the labor regulations that apply to local entreprises.

Social Partners

Social Dialogue and Involvement of Social Partners
Most of the unions belong to Histadrut (General Federation of Labor in Israel), or to a much smaller rival federation, the Histadrut Haovdim Haleumit (the National Labor Federation). Negotiations are carried out at the national and sectoral level.
Unionization Rate
Unionization rate in percentage of the labor market population in Israel : 15% in 2014.
Regulation Bodies
Ministry of Industry, Trade and Labor

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Last Updates: October 2014