In short
When are wages considered late, and what compensation is due?
Under the Wage Protection Law, 5718-1958, a monthly salary is due by the 9th of the following month. After that the wages are late, and late-payment compensation is 5% for the first week and 10% for each additional week.
When Wages Are Considered Late
Under the Wage Protection Law, 5718-1958, a monthly salary is due at the end of the month for which it is paid. A salary not paid by the ninth day after the due date is a late wage (sachar mulan). For example, a January salary that was not paid by February 9.
Late payment is not only non-payment in full. A partial payment, a pay slip missing components such as overtime, or a deduction the law does not permit can create late payment for the amount that was not paid.
How Much Late-Payment Compensation Is Due
Late wages carry late-payment compensation (pitzuei halanat sachar): 5% of the late wage for the first week after the ninth day, and 10% for each additional week or part of a week. The calculation is based on the gross wage, without ancillary payments and expense reimbursements. Even a delay of a few weeks therefore adds up to a significant amount.
The Labor Court may reduce or cancel the late-payment compensation if the delay resulted from an honest mistake, from circumstances beyond the employer's control, or from a genuine dispute over the debt, provided that the undisputed amount was paid on time. In practice the courts often reduce the amount, and full compensation is usually awarded in serious cases.
Severance pay not paid within 15 days of its due date also carries compensation for late payment: from day 16 to day 30, linkage differentials, and beyond that an additional 20% per month. Here too the court may reduce the compensation.
The Deadlines to Claim Are Short
The wage itself can be claimed for up to seven years. Late-payment compensation is subject to much shorter deadlines. Where the wage was paid late, the compensation must be claimed within 60 days of receiving the wage, and the court may extend this to 90 days. Where the wage was not paid at all, the claim must be filed within one year of the day it became late. Where the same employer repeatedly pays late, the period is longer.
The same short deadlines apply to late severance pay. An employee who waits to see what happens may lose the late-payment compensation, even if the wage itself is not yet time-barred.
What to Do When Wages Are Not Paid
Contact the employer in writing and demand the payment and the pay slips. Keep pay slips, attendance reports, messages and bank statements showing when each payment came in. Sometimes a well-prepared demand letter is enough to have the payment made without a claim.
If the employer does not pay, a claim is filed in the Regional Labor Court, which hears claims for wages, late-payment compensation and other rights arising from the employment relationship. Late payment of wages is also an offense, but the claim is the way to get the money.
What the service includes
- Calculating the late wage and the late-payment compensation
- Reviewing pay slips, deductions and missing components
- Demand letter to the employer
- Late severance pay and final settlement
- Claims in the Regional Labor Court
When to contact us
- Your salary did not arrive by the 9th of the month
- You received only part of your salary, or components are missing from the pay slip
- You finished working and did not receive your final settlement or severance pay
- Your employer pays late again and again
What to bring to the meeting
- Pay slips
- Bank statements showing the payment dates
- The employment contract
- Attendance reports and correspondence with the employer
Late or Unpaid Wages throughout Israel
The firm represents clients from all over Israel: Jerusalem and the Shfela, Be'er Sheva, Ashdod and Ashkelon, Haifa and the North, the Sharon and Gush Dan. Meetings take place at our two Modiin branches, at the WE Towers branch in Tel Aviv or by video call, and documents can be sent in advance on WhatsApp. We represent clients in the courts, the Labor Courts and before planning committees throughout Israel. How we work with clients across Israel.
Frequently asked questions
When is a wage considered late?
When a monthly salary was not paid by the ninth day after the due date, which is the end of the month for which the salary is paid. For example, a January salary not paid by February 9.
How much late-payment compensation is due?
Under the Wage Protection Law, 5% of the gross wage for the first week after the ninth day, and 10% for each additional week or part of a week. The court may reduce or cancel the amount in the circumstances the law lists, such as an honest mistake or a genuine dispute over the debt.
How long do I have to claim late-payment compensation?
The deadlines are short. Where the wage was paid late, within 60 days of payment, with a possible extension to 90 days. Where the wage was not paid, within one year of the day it became late. The wage itself can be claimed for up to seven years.
My wages were not paid. Can I resign and receive severance pay?
Sometimes, yes. Non-payment of wages may be treated as a material deterioration in working conditions, which entitles an employee who resigned to severance pay. Under the case law, the employee usually needs to warn the employer first and give it an opportunity to fix the problem.
My employer says there is no money to pay salaries. Does that release it?
No. Financial difficulties do not cancel the duty to pay wages, and the wages are due in full. Where the employer becomes insolvent, there is a route for payment of part of the debt through the National Insurance Institute (Bituach Leumi).
