General Collective AgreementWhat it is, how an extension order works, who it applies to · and NETO's commitment
A general collective agreement sets the terms of employment for a whole sector. Through an extension order it binds every employer in the sector · even one that is not a member of the organization. Here: what a general collective agreement is, the general collective agreement for manpower workers (2004), the employer's duties · and how NETO ensures full compliance with the rights of the workers it employs.
AI summary · general collective agreementClick to read the page summary
A general collective agreement is an agreement between an employers' organization and a workers' organization that regulates the terms of employment for a whole sector rather than a single workplace. It is defined in the Collective Agreements Law, 5717-1957, and is registered with the Labor Relations Officer. Through an extension order issued by the Minister of Labor, the agreement binds all employers and workers in the sector · even those who are not members of the signatory organization. In the manpower sector, a general collective agreement for the workers of manpower companies was signed on 16 February 2004, regulating a range of terms · wages, pension, recuperation, leave, sick days and more. NETO is a manpower contractor (license 1565) that employs workers and is bound by these rights.
- What it is · an agreement between an employers' organization and a workers' organization · regulates a whole sector.
- Extension order · applies the agreement to the entire sector, including non-signatories.
- Who it covers · workers of manpower companies placed with an actual employer.
- What it regulates · wages, pension, recuperation, leave, sick days, holidays and more.
- NETO · a manpower contractor, license 1565, an employer bound by these rights.
- This information is general only · not legal advice · the binding text was published in the Official Gazette.
- In brief
- What a general collective agreement is
- Extension order · how it binds everyone
- Who the manpower-sector agreement applies to
- The employer's duties · the main rights
- How NETO ensures compliance
- The collective agreement text (2004)
- Summary of the agreement's main points
- Frequently asked questions
- Disclaimer · general information only
In brief
A general collective agreement is a central tool in Israeli labor law: an employers' organization and a workers' organization sign an agreement that regulates the terms of employment for a whole sector. When an extension order is published over it, the agreement becomes binding on every employer in the sector. In the manpower sector there is a general collective agreement (2004) that enshrines many rights for workers placed with actual employers · and NETO, as a manpower contractor, is bound by it.
- Collective agreement · under the Collective Agreements Law, 5717-1957 · registered with the Labor Relations Officer.
- General vs. special · a general agreement regulates a sector · a special one regulates a single workplace.
- Extension order · the Minister of Labor applies the agreement to the entire sector, including non-members.
- Manpower workers · the 2004 agreement regulates wages, pension, recuperation, leave and more.
What is a general collective agreement
A collective agreement is a written agreement between an employer or an employers' organization and a workers' organization concerning terms of employment and its termination. It is governed by the Collective Agreements Law, 5717-1957, and is registered with the Chief Labor Relations Officer at the Ministry of Labor. The law divides it into two types.
Special collective agreement
Signed between a single employer (or a group of employers) and the workers' organization at the workplace. It applies to one workplace · for example, an agreement between a specific company and its workers' committee.
General collective agreement
Signed between an employers' organization and a workers' organization and regulates the terms of employment for a whole sector or a class of workers nationwide · for example the manpower, security or cleaning sectors.
Legal status
The provisions of the agreement concerning terms of employment become part of the personal employment contract of every worker it covers, granting rights that cannot be waived to the worker's detriment.
Extension order · how a sector agreement binds everyone
On its own, a general collective agreement binds only the members of the signatory organizations. To make it apply to the whole sector, the Minister of Labor publishes an extension order in the Official Gazette · and from that moment the agreement (or parts of it) binds all employers and workers in the sector, including anyone who is not a member of an organization.
Who issues the order
The Minister of Labor, under the authority of the Collective Agreements Law. The order is published in the Official Gazette and specifies which provisions of the agreement are extended and to which workers.
Who it applies to
All employers and workers in the sector to which the order is directed · even if the employer is not a member of the employers' organization and even if the worker is not a Histadrut member.
Why it matters
The order creates a uniform floor of rights for all workers in the sector, and prevents employers from competing on the backs of employment terms. This is the basis for enforcing rights in the manpower sector.
The general collective agreement for manpower workers was submitted for registration with the Labor Relations Officer, and the parties requested an extension order for the business sector · as expressly set out in sections 7.1 to 7.4 of the agreement itself. Further reading: Extension order in the manpower services sector and the law on employing workers through manpower contractors.
The agreement in the manpower sector · who signed it and who it covers
The general collective agreement for manpower workers was signed in Tel Aviv on 16 February 2004. It was intended to regulate the terms of employment of workers employed by manpower companies and placed with an actual employer.
The workers' organizations
The New General Histadrut · Trade Union Division, and the National Labor Federation · both together and each separately (the "Histadruts").
The employers' organizations
The Association of Human Resources Service Providers in Israel and the National Union of Human Resources Companies affiliated with the Federation of Chambers of Commerce (the "Organizations").
Who it covers
Every worker employed by a manpower company and placed with an actual employer in the business sector. Exceptions: in-house staff, nursing care, computing and personal contracts · as detailed in section 4 of the agreement.
Background: manpower service companies meet the needs of workers who want temporary work and the needs of employers for temporary work. See also: employing workers through a manpower agency and the rights of a worker employed via a manpower agency.
The main rights · what the agreement requires the employer to provide
The general collective agreement for manpower workers enshrines a long list of rights. These are the main duties the agreement imposes on the employer (the manpower company) · the figures are presented as they appear in the agreement, which is set out in full further down the page.
| Topic | What the agreement provides | Section |
|---|---|---|
| Wages | No lower than the minimum wage and the sector wage table (Appendix A) · updated with cost-of-living increments and extension orders. | 8.10 |
| Working hours | A 43-hour work week · overtime premium under the Hours of Work and Rest Law. | 8.2 |
| Shift work | Second shift 120%–125% · third shift 130%–150% (for those not subject to another arrangement). | 8.2.5 |
| Annual leave | From 11 days (first years) up to 26 days by seniority · in working days. | 8.4 |
| Sick days | 24 paid days each year, up to 130 accrued days · under the Sick Pay Law. | 8.3 |
| Recuperation pay | From 5 days in the first year up to 10 days for veterans. | 8.7 |
| Travel expenses | Participation in the cost of travel to and from work, in line with the sector agreements. | 8.6 |
| Pension insurance | After 9 months · employer contributions 12% (6% benefits + 6% severance) and worker 5.5% to a pension fund · or 13.33% for managers' insurance. | 8.13 |
| Study fund | If the actual employer is obliged to it under a collective agreement · after a 6-month waiting period. | 8.14 |
| Holiday gift | Twice a year · at Passover eve and Rosh Hashanah. | 8.12 |
| Prior notice | Prior notice of dismissal in accordance with the law. | 8.15 |
| Welfare fund | Establishment of a joint welfare fund with the Histadruts · support for workers in distress, illness, fertility and more. | 12 |
How NETO ensures compliance with the agreement and the worker's rights
NETO is a licensed manpower contractor and is the worker's employer in every respect · not merely an intermediary. That means every right under the collective agreement and protective legislation is calculated, set aside and paid through its system. Here is how it works, step by step.
A full employer-employee relationship
The worker is employed directly by NETO as a salaried employee · with a payslip, seniority and social rights · and placed to work with the actual employer under the agreement.
Wages and rights under the agreement and the law
Wages are no lower than the minimum wage and the sector wage table. Leave, sick days, recuperation pay, holidays and travel reimbursement are calculated by the worker's seniority and the agreement.
Social contributions on time
Pension insurance, severance pay and a study fund (where eligible) are remitted to the relevant institutions on time · at the rates set by the agreement.
A clear, detailed payslip
Every month a detailed payslip is issued covering all wage components and deductions · so the worker sees exactly what was paid and set aside for them.
Licensed and supervised operation
NETO operates as a manpower contractor under license 1565 and the supervision of the Ministry of Labor · the regulatory framework designed to ensure workers' rights are protected.
The general collective agreement · as signed (2004)
Below is the general collective agreement for manpower workers, as published by the authorities, presented in English. The text is arranged in expandable blocks following the structure of the agreement · open only what you want to read. All rights reserved to the New General Histadrut.
1. Preamble, interpretation and headings
1.1 The preamble and appendices to the agreement form an integral part of it.
1.2 The Interpretation Law, 5741-1981, shall apply to this agreement as if it were legislation within the meaning of that law, unless the context requires otherwise.
1.3 Section headings are provided for ease of reading and orientation only, and nothing shall be inferred from them regarding the interpretation of the agreement, its extension or its narrowing.
2. Definitions
"The Law" · the Employment of Workers by Manpower Contractors Law, 5756-1996, as in force at the date of signing the agreement and as in force from time to time.
"Collective agreement" · as defined in the Collective Agreements Law, 5717-1957.
"Placement" · placing a worker to work with an actual employer for the purpose of assessing their suitability for direct employment by the actual employer.
"Company / manpower company / employer" · a manpower contractor as defined in section 1 of the Law, that is a member of the Organizations.
"Work month / full-time position" · for the purpose of accruing social rights, a work month of 175 hours shall be counted as a full month.
"Client / actual employer" · as defined in section 1 of the Law.
"Worker" · any worker employed by a manpower company, unless it is determined that the agreement does not apply to them under section 4 below.
"In-house staff" · workers who perform their work directly at the company, as distinct from workers placed to work with a client.
"Pensionable wage" · as defined for the wage used as the basis for calculating severance pay under the Severance Pay Regulations, including a shift premium for workers who work shifts on a permanent basis.
The full definitions also include the "Histadruts", the "Organizations", "monthly worker", "daily worker", the "monitoring committee" and the "maximum lawful employment period".
3. General provisions
3.1 A worker shall be employed in the type of work, working hours, workplace and scope of work according to the client's needs and after coordination with the client. The worker has the right to decline a task/role offered to them, but must complete the work/role they are performing at the client, provided there is no material worsening of their employment terms.
3.2 Wages shall be paid to the workers at the time fixed in the Wage Protection Law, 5718-1958.
3.3 The employer shall deduct from the worker's wages all deductions required under any law and this agreement, and shall remit them on time to the body for which they were deducted.
3.4 The employer shall provide the worker, each month and no later than the wage payment date, with a payslip that includes a full breakdown of wage components and deductions.
4. Application
4.1 The agreement applies to all workers, except in-house staff, workers employed in providing nursing-care services, workers in computing roles as defined in the Law, workers on personal contracts as detailed below, and workers employed in caring for disabled veterans of the security forces on behalf of the Rehabilitation Division.
4.2 Every company may employ workers on personal contracts provided it is stipulated in them that the agreement does not apply, and provided it does not employ more than 10% of its workers on personal contracts, and provided the employer cost for a personal-contract worker is not lower than that under the agreement.
4.3 The agreement shall apply to manpower-company workers placed with actual employers in the business sector only.
5. Placement of workers with an actual employer
5.1 A manpower company shall place a worker with an actual employer only for work that is temporary/periodic by nature ("temporary roles").
5.2 Only the following shall be considered temporary roles: replacing a worker on maternity leave · replacing a worker on unpaid leave / sick leave / work accident / loss of earning capacity · staffing a time-limited project · temporary reinforcement due to seasonal needs · unforeseen work pressure · placement · staffing a new activity until it stabilizes · staffing positions requiring special skills in technology and science · and any additional category set in advance by the monitoring committee.
5.3 The parties share the view that action should be taken to prevent arbitrary dismissals or turnover of workers aimed at circumventing the statutory provisions on the maximum lawful employment period with an actual employer.
5.5 The parties agree that the provisions of sections 5.1 and 5.2 should be fully enforced and will act jointly to implement them.
6. Dispute resolution · parity committee and monitoring committee
6.1 The parties establish a parity committee, composed of one representative on behalf of the Histadruts and one representative on behalf of the Organizations.
6.2 The parity committee has exclusive authority to decide disputes between the parties or their members regarding the realization of workers' rights, the existence of an employer-employee relationship or its termination.
6.3 The committee shall hold and conclude its deliberations within 14 days of a request to convene it, and shall publish its decision within 7 days of the conclusion of the deliberation.
6.5–6.8 If the parity committee does not reach a decision · the matter shall be referred to the monitoring committee, which shall conclude its deliberations within 15 days. The proceeding in the monitoring committee is final and binding.
7. Registration of the agreement and issuance of an extension order
7.1 The agreement shall be submitted to the Chief Labor Relations Officer for registration as a general collective agreement.
7.2 The parties shall apply to the Minister of Labor and Welfare and request an extension order over the agreement for the business sector only.
7.3 The validity of the agreement is conditional on an extension order being issued over its provisions, including section 5, and for the business sector only. The condition has the status of a condition precedent under section 27(a) of the Contracts Law.
7.4 If no extension order is issued, the parties shall act in all necessary judicial instances to obtain it.
8. Terms of employment (a) · hours, holidays, sickness, leave, recuperation, travel
8.1 General · the terms of employment in the agreement relate to full-time workers. Part-time workers are entitled to the terms on a pro-rata basis. Rights that depend on seniority refer to seniority at the same workplace / with the same client / at the company.
8.2 Working hours · a 43-hour work week (or as customary at the client). Overtime premium under the Hours of Work and Rest Law, 5711-1951. Shift work · for those not subject to another arrangement · 120%–125% on the second shift and 130%–150% on the third shift.
8.2.6 Holidays · a worker employed for 3 full and consecutive months, who was not absent the day before or after the holiday, is entitled to holiday pay. A worker who worked on a holiday is entitled, in addition to full pay, to payment equal to a leave day. Non-Jewish workers are also entitled to paid absence on their own holidays, up to 9 days.
8.3 Sick leave · 24 paid sick days per year at the pensionable wage, but no more than 130 accrued days, under the Sick Pay Law, 5736-1976 and against medical certificates. Accrued sick days are not redeemable.
8.4 Annual leave · by the worker's seniority at the company, in working days:
| Seniority at the company (years) | 6-day week | 5-day week |
|---|---|---|
| First to fourth | 13 | 11 |
| Fifth | 14 | 12 |
| Sixth to eighth | 19 | 17 |
| Ninth onward | 26 | 23 |
8.5 Special leave · a worker after 3 months of employment is entitled to paid absence on the day of their wedding, their son's circumcision, the celebration of a daughter's birth, and a bar/bat mitzvah. A worker in mourning for a first-degree relative is entitled to absence according to the laws of their religion, up to 7 calendar days paid.
8.6 Travel expenses · the employer shall participate in the cost of travel to and from work, in line with the collective agreements between the Coordinating Bureau and the Histadrut. At a workplace where transportation to the client exists · the employer's workers are also entitled to use it.
8.7 Recuperation pay · a worker who has completed a full year of employment is entitled to recuperation pay:
| Seniority (years) | Recuperation days |
|---|---|
| First | 5 |
| Second and third | 6 |
| Fourth to tenth | 7 |
| Eleventh to fifteenth | 8 |
| Sixteenth to nineteenth | 9 |
| Twentieth onward | 10 |
8.8 Clothing · every worker is entitled to work clothing under the sector agreement / extension order / the agreement applying to the client, and as required by safety rules. 8.9 Meals · at a workplace where a dining room exists · the company's workers are also entitled to use it as customary at the client.
8. Terms of employment (b) · wages, holiday gift, pension, study fund, prior notice
8.10 Wages · every worker shall be paid wages according to their role, profession and experience, and no lower than the wage framework for the profession/sector in Appendix A. Wages shall be updated with cost-of-living increments and extension orders, and shall not fall below the minimum wage. Once a year a discussion shall be held on updating wages and rates.
8.12 Holiday gift · the employer shall give every worker a holiday gift twice a year · at Passover eve and Rosh Hashanah.
8.13 Pension arrangement · all workers shall be insured in an approved comprehensive pension fund, at the end of 9 months of employment (waiting period). Contributions are calculated on the basis of the pensionable wage: to the fund no less than 17.5% · of which 12% at the company's expense (6% benefits and 6% severance) and 5.5% benefits at the worker's expense. For managers' insurance, 13.33% at the company's expense (including up to 2.5% to cover loss of earning capacity for compensation of 75% of the wage).
8.13.9 The company's contributions to pension insurance shall come in place of severance pay under section 14 of the Severance Pay Law · up to 72% of the severance for the period of contributions to a pension fund, and up to 100% for the period of contributions to managers' insurance. A worker entitled to severance shall receive a severance top-up at a rate of 2.33% of their pensionable wage.
8.13.11 Until the pension arrangement is in place · the worker shall be insured under collective risk insurance: 100,000 NIS for death, and for loss of earning capacity, compensation at 50% of their wage (cost up to 0.5% of the wage at the company's expense).
8.14 Study fund · a company shall contribute to a study fund for the worker if the actual employer is obliged to it under a collective agreement · after a 6-month waiting period from the date the agreement applies to the actual employer, and at the rates set in it.
8.15 Prior notice · workers are entitled to prior notice of dismissal in accordance with the provisions of the law.
9–13. Training, strikes, membership dues, welfare fund, industrial peace
9. Training and qualification · the company shall train its workers and provide for professional development from time to time, at its expense. A company may require a worker who underwent training to remain employed for a reasonable period after the training.
10. Prohibition on strike-breaking · an employer shall not place workers in the place of striking workers and shall not act to break a strike. Company workers who are locked out due to a strike at the client · have the same status as the client's workers.
11. Membership dues / handling fee · union membership dues of 0.9% shall be deducted from the wages of workers who are members of the Histadruts, and an organizational-professional handling fee of 0.7% from non-members · and remitted to the account the Histadruts direct.
12. Welfare fund · every company shall establish a welfare fund jointly with the Histadruts. The fund shall run welfare programs and support workers during prolonged illness, fertility and pregnancy treatments, and distress. Every company shall pay the fund 0.1% of its workers' wages and deduct a further 0.1% from their wages.
13. Industrial peace · during the term of the agreement neither party shall resort to strike or lockout measures on matters regulated in the agreement. A strike at a workplace where the actual employer's workers are on strike is not a breach of this section.
14–16. Term of the agreement, expanding the circle of employed, enforcement
14. Term of the agreement · the agreement is made for a period of two years from the issuance of the extension order (except sections 11.1 and 11.3, which took effect on signing). The term shall be extended from time to time for two years, unless a party gives written notice 60 days in advance of its wish for changes. For the purpose of section 5.3 only · the agreement shall be treated as an agreement for an indefinite term under section 13 of the Collective Agreements Law.
15. Actions to expand the circle of the employed · the parties shall make efforts to highlight the sector's contribution to expanding the labor market, and shall invest efforts to promote vocational training and placement of young people up to age 30, family breadwinners, women and single parents.
16. Enforcement · the parties shall act to enforce the provisions of the agreement, including as stated in the appendix to the agreement. And in witness whereof the parties have signed.
Appendix A · wage table for skilled workers (in New Israeli Shekels)
Wage ranges by worker type · on an hourly basis and on a monthly salary basis · as set in Appendix A to the original agreement:
| Worker type | Hourly · from | Hourly · to | Monthly · from | Monthly · to |
|---|---|---|---|---|
| Metal workers (machinists, welders, etc.) | 18.87 | 30.60 | 3,509.82 | 5,691.60 |
| Para-engineering professions (technicians, draftsmen) | 19.89 | 35.70 | 3,699.54 | 6,640.20 |
| Engineering professions | 23.46 | 56.10 | 4,371.72 | 10,404 |
| Computer staff (programmers, systems analysts) | 22.44 | 51.00 | 4,151.40 | 9,454 |
| Secretarial and computerized office | 19.125 | 30.60 | 3,556.74 | 5,691.60 |
| Industrial and construction professions (intermediate levels) | 18.462 | 25.50 | 3,433.32 | 4,743 |
In sectors whose wage table was set/updated in a general (including sectoral) collective agreement · workers' wages shall not fall below the rates in those agreements, as updated from time to time. The amounts reflect the date the agreement was signed and have since been updated with cost-of-living increments and the minimum wage.
Regulations of the welfare and culture fund · and the monitoring committee's decision
Regulations for approving grants · the fund's management (a company representative and a Histadruts representative) is authorized to approve grants: purchase of medical devices for the worker or a family member · up to 2,000 NIS and no more than 50% of the expense. Assistance in a time of special personal distress · up to 3,000 NIS and no more than 50%. Loans to a worker · up to 5,000 NIS a year, guaranteed by the company, repayable over up to 12 months.
The grant shall be given once per budget year, the committee's decisions are made unanimously, and the grant amounts are updated according to the fund's financial position.
The monitoring committee's decision (section 5.2.9) · additional "temporary roles" were set: workers at telephone service centers (call centers) except at Bezeq · bank teller/current-account clerks ("tellers") · promoters and sales agents outside the employer's premises · couriers. The decision is valid for the term of the agreement.
Summary of the collective agreement's main points · in plain language
From here on is an explained digest of the main points of collective regulation · wages, welfare, gender equality and dispute-resolution mechanisms. The digest is provided to make the content accessible and is not legal advice; for a concrete right, refer to the agreement text and the relevant extension order.
Wages and social terms
A base-wage principle for all workers · indexation to the consumer price index once a year to prevent erosion. Contributions to pension, to severance pay and to a study fund.
Welfare and expense reimbursement
Participation in communications and travel costs, a budget for professional development, and a holiday gift twice a year · at Rosh Hashanah and Passover.
Gender equality and parenthood
Mechanisms to maintain gender balance in hiring, expanded parenthood rights (maternity leave and job protection) and the option of flexible hours for parents.
Job security
An orderly process before dismissal · feedback conversations, a probation period and involvement of a "manpower committee". Absence due to a parental obligation is not grounds for dismissal as long as a reasonable solution is found.
Dispute resolution
A structured mechanism for resolving disputes between the committee and management · negotiation meetings and a decision by the manpower committee or an expanded committee where needed.
Onboarding and departure
Appendices regulating the onboarding and departure procedures · the administrative and personal process on joining and leaving the organization.
General collective agreement · questions and answers
What is a general collective agreement?
A general collective agreement is an agreement between an employers' organization and a workers' organization that regulates the terms of employment for a whole sector or a class of workers across the country. It is governed by the Collective Agreements Law, 5717-1957, and is registered with the Chief Labor Relations Officer at the Ministry of Labor.
What is the difference between a general and a special agreement?
A special collective agreement is signed between a single employer and the workers' organization at the workplace, and applies to one workplace. A general collective agreement is signed between an employers' organization and a workers' organization and regulates a whole sector or a class of workers across the country.
What is an extension order and how does it work?
An extension order is an order published by the Minister of Labor in the Official Gazette that applies a general collective agreement (or parts of it) to all employers and workers in the sector · including anyone who is not a member of the signatory organization. This creates a uniform floor of rights for all workers in the sector.
Who does the collective agreement in the manpower sector apply to?
The 2004 agreement applies to workers employed by manpower companies and placed with an actual employer in the business sector. There are exceptions · in-house staff, nursing care, computing and personal contracts · as detailed in section 4 of the agreement.
What rights does a manpower worker receive under the agreement?
Among others: wages no lower than the sector wage table, overtime and shift premiums, annual leave by seniority, 24 sick days a year, recuperation pay, travel reimbursement, pension insurance, a holiday gift and prior notice. The full detail is set out in the "Agreement text" section on this page.
Is NETO bound by the collective agreement?
Yes. NETO is a manpower contractor (license 1565) and the worker's employer. As such it is subject to protective legislation and to the collective and sectoral regulation applying to the manpower sector, and it calculates, remits and pays the rights through its system.
When do pension contributions begin under the agreement?
Under the agreement, pension insurance begins at the end of 9 months of employment (waiting period), unless more favorable terms apply to the worker through the actual employer or a prior arrangement. The contribution rates are set out in section 8.13 of the agreement, and are subject to updates to the law and the mandatory pension in the economy.
Does a collective agreement override a personal employment contract?
The provisions of a collective agreement concerning terms of employment become part of the personal employment contract and cannot be waived to the worker's detriment. A personal contract may improve on the agreement, but it cannot reduce rights granted by the agreement or the law.
Related guides
More on employment through a manpower agency, the worker's rights and sectoral regulation.
Employing a worker? NETO takes care of the rights
As a licensed manpower contractor, NETO employs the worker and ensures compliance with the rights of the agreement and protective legislation · without you having to run a payroll and social-contributions operation yourself. Open an employer account or talk to us.
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