Contrary to reports: this is the real amount you will receive this month as a salary increase

If you were expecting to see an increase of hundreds of shekels in your next payslip following reports of the new convalescence pay agreement, you should cool your enthusiasm. Despite the declarations, celebrations, and agreements signed in the business sector, the Minister of Labor has not yet signed the extension order. The immediate implication is that in the upcoming salary, you will see only the old rates, but the good news is that the happy news has only been delayed, not canceled.

In recent weeks, many reports have been circulated about a dramatic agreement signed by the Histadrut and the Business Sector Presidency, according to which the daily convalescence pay rate would be significantly increased. However, for this agreement to be binding on all employers in the private sector, an official signature by the Minister of Labor, Yoav Kisch, on an extension order is required. But despite reports that this is merely an administrative procedure, it turns out that the situation is more complex: before the final signature, it must be published for public comment as required by law, but the public comment period has not yet ended. The end date is set for August 7, 2026, and only after that, provided there are no objections from the legal counsel, is the minister expected to sign the order. This means that the mentioned increase will not take effect in this month's payment, contrary to what was promised, and will be paid retroactively in the September salary, if approved.

Alongside the delay, there is a particularly important bright spot for employees. In the previous two years, in the shadow of the Iron Swords war, employees were required to give up one day of convalescence from their balance of days for the state budget, alongside a full freeze on the daily rate. This year, this measure has ended completely, and your balance of convalescence days has returned to its full format as usual according to the law and seniority, without any reduction.

Useful guide: everything you need to know about convalescence pay

As of the upcoming salary, the value of a convalescence day in the private sector remains 418 shekels, and only after the official extension order is signed will it jump to 451.5 shekels per day. In the public sector, the updated rate is already 511.6 shekels per day, compared to 471.4 shekels in previous years. It is important to emphasize that private sector employees will receive the difference for the summer months retroactively as soon as the order officially enters into force.

The number of days you are entitled to is determined solely based on the seniority you have accumulated at the workplace:

• First year: 5 days

• Second and third years: 6 days

• Years 4 to 10: 7 days

• Years 11 to 15: 8 days

• Years 16 to 19: 9 days

• From the 20th year onwards: 10 days

Part-time or hourly employees are entitled to proportional payment according to the scope of their position. The basic threshold condition for receiving the payment is the completion of one full year of work with the current employer. In most workplaces, it is customary to pay the amount in one installment in the payslip of one of the summer months, but the law allows the employer to divide the amount into 12 equal monthly payments provided they appear on a separate line in the payslip.

Convalescence pay is a mandatory right by law, meaning a protective right that the employee is not allowed to waive under any circumstances. In terms of taxation, convalescence pay is considered regular income from which mandatory deductions (income tax, National Insurance, and health insurance) are taken, but it is not included in the salary determining pension contributions or severance pay calculations.