Dear Clients and Friends,
Against the background of the continuing emergency period and its ongoing impact on the workplace, we would like to share with you an important client update addressing key developments relevant to employers. The memorandum below reviews the main provisions of the new extension order regarding reservists and their spouses, including expanded protections in the context of dismissal and unpaid leave, new paid absence entitlements, annual leave accrual rules, and an important update regarding employer indemnification for social benefit costs during reserve duty service.
A New Extension Order to a Collective Agreement Regarding Reservists, Their Spouses, and Annual Leave Accrual for 2026 Onward
Further to our publication of March 9, 2026, regarding the intention to issue an extension order to the collective agreement on April 28, 2026 an extension order to a general collective agreement was signed regarding reservists, their spouses, and annual leave accrual under the Collective Agreements Law, 1957 (the “New Extension Order”).
The New Extension Order expands the provisions of the general collective agreement signed on February 23, 2026, and provides that its provisions will apply to all employees and employers in Israel, except for employees and employers to whom a collective agreement in the public sector dated March 26, 2026 applies, or will apply, on the same subjects.
Applicability of the Order
As a general rule, the New Extension Order applies as of January 1, 2026 and for an unlimited period. However, it is important to note that the expanded protection against dismissal (Section 5 of the Order), as detailed below, applies only from the date of publication of the Order onward, namely as of April 29, 2026.
Main Provisions of the New Extension Order
1. Extension of the Protected Period Against Dismissal
As a reminder, the Discharged Soldiers (Reinstatement in Employment) Law, 1949, provides that an employer may not dismiss an employee during reserve duty service, nor during the 30 days following the end of such service, unless a permit is obtained from the Employment Committee at the Ministry of Defense.
The provisions of the New Extension Order add to and expand this protection: an employer of an employee who was absent due to reserve duty for at least 60 cumulative reserve duty days in a calendar year, and who served at least seven consecutive days, may not dismiss the employee during an additional 30-day period following the 30 days after the end of reserve duty under the law, unless special reasons exist and the requested dismissal is not due to the reserve duty service.
2. Prohibition on Placing an Employee on Unpaid Leave During the Extended Protected Period
The New Extension Order includes a provision prohibiting an employer from placing on unpaid leave an employee who was absent due to reserve duty, including during the additional 30-day period, unless one of the following applies:
- Special reasons exist; the requested unpaid leave is not due to the reserve duty service and it is with the employee’s consent; or
- The employee wishes to take unpaid leave, even if related to the reserve duty, and both parties agree to the unpaid leave arrangement.
3. Supervisory Committee Regarding Dismissal or Unpaid Leave
The New Extension Order provides that a Supervisory Committee under the Collective Agreements Law will serve as the body for resolving disputes relating to dismissal or placement on unpaid leave during the protected period, to the extent such disputes arose on or after the publication date of the Order.
An employer seeking to dismiss or place on unpaid leave an employee serving in reserve duty during the protected period is required to apply to the Supervisory Committee. The Supervisory Committee must decide within 14 days from the date the application is filed, after receiving the employee’s response, and the dismissal or unpaid leave will not take effect until its decision is rendered. If the Supervisory Committee finds that no dispute exists between the parties, it will not examine the matter on its merits and will notify the parties accordingly within 5 days.
It is important to note that even in the case of an agreed application, the employer must still apply to the Supervisory Committee; however, in such circumstances the Committee is not required to decide the matter on its merits, but only to notify the parties that no dispute was found.
4. Prohibition on Deterioration of the Reservist’s Terms of Employment
The New Extension Order provides that an employer may not impair the terms and conditions of employment of a reservist – including by transferring the employee to another position, adding duties, or removing duties – including during the additional 30-day period following the 30 days after the end of reserve duty service.
However, not every change will be deemed a prohibited impairment. The following will not be regarded as an impairment of employment terms:
- A reduction in income applicable in the workplace by virtue of law or a collective agreement;
- A reduction in a salary component paid based on work output, provided that the decrease in output was not caused by reasons dependent on the employer.
5. Paid Absence Days for the Spouse of a Reservist
The New Extension Order provides that the spouse of a reservist is entitled to paid absence days, depending on the number of cumulative reserve duty days in a calendar year:
| Cumulative reserve duty days in a calendar year | Paid absence days for spouse |
| Up to 30 days | No entitlement |
| 31 – 60 days | 2 days |
| 61 – 90 days | 4 days |
| 91 – 120 days | 6 days |
| 121 days and above | 8 days |
Who is eligible?
The entitlement is intended for a “spouse of a reservist” (including a common-law spouse, same-sex spouse, and a co-parent in joint custody), who falls within one of the following categories:
- A person who has at least one child under the age of 14;
- A person who has a child under the age of 18 who has a malignant illness or is undergoing dialysis;
- A person who has under his or her exclusive care or supervision a relative who is a person with a disability; or
- A person whose parent, or whose spouse’s parent, is ill as defined by law.
Under what circumstances may the days be used?
The absence days may be used in one or more of the following circumstances:
- Illness of a child under the age of 14;
- Treatment of or exclusive supervision over a relative who is a person with a disability;
- Illness of a child under the age of 18 who has a malignant illness or is undergoing dialysis;
- Care for an ill parent;
- Extension of the spouse’s maternity and parenthood leave period;
- Supervision of and care for a child;
- Absence required due to the spouse’s departure for active reserve duty, for essential arrangements relating to the management and maintenance of the household that can only be performed during working hours;
- Other absences, in coordination with the employer.
Additional points regarding the paid absence days
- The absence days may be used only during the spouse’s active reserve duty service.
- They may also be used partially, as hours of absence, and not only as a full working day.
- Use of an absence day due to a child’s illness, care for a relative with a disability, or care for an ill parent is subject to presentation of a medical certificate close to the time of use.
- The right does not accrue beyond December 31 of the relevant calendar year and may not be redeemed for payment.
- Days used during 2023-2025 pursuant to previous arrangements do not reduce the entitlement under the New Extension Order.
- The New Extension Order expressly clarifies that the entitlement to paid absence days, including the option to use them as accumulated hours, also applies to a spouse of a reservist employed part-time. The value of an absence day is equivalent to vacation pay (including sick pay).
- For a spouse of a reservist whose annual vacation entitlement exceeds 35 days in a calendar year, the paid absence day entitlement will be half the number of absence days set out in the table.
Retroactive Application of the Paid Absence Day Entitlement
As noted, the New Extension Order generally applies as of January 1, 2026. Accordingly, transitional provisions were established regarding absence days used in the period from January 1, 2026 until before publication of the Order:
- If absence days were used and full salary was paid in respect thereof, such days must be restored to the spouse’s sick leave and/or annual leave balance no later than the salary payment for the month following publication of the Order.
- If absence days were used but full salary was not paid in respect thereof, they must be restored to the balance from which they were taken, and the remaining salary must also be paid, likewise no later than the salary payment for the month following publication of the Order.
Important to note: absence days restored as aforesaid will be counted against the paid absence day entitlement granted under the New Extension Order.
6. One Hour of Absence for the Spouse of a Reservist
The New Extension Order provides that the entitlement to one hour of absence under Section 7(c)(6) of the Women’s Employment Law will also apply where the spouse is employed full-time across several employers, proportionately with each employer, provided that supporting documentation is presented regarding the actual scope of employment with all employers combined.
7. Annual Leave Accrual
The New Extension Order provides that, notwithstanding any law, an employee may accrue the balance of annual vacation days even without the employer’s consent, and attach them to vacation to be taken in the following two working years, if during a calendar year one or more of the following occurred:
- The employer did not grant the employee vacation during that calendar year in which one of the decisions enumerated in the Order applied, including a declaration of a special situation on the home front, issuance of a reserve duty order under Section 8, declaration of a civilian emergency event, or declaration of a contagious and dangerous disease;
- The employee was absent due to reserve duty for at least ten consecutive days;
- The employee was absent from work or did not perform work due to the circumstances detailed in the Protection of Employees in Emergency Situations Law;
- The employee was called for labor service in an essential enterprise or an enterprise providing essential services in accordance with the Emergency Labor Service Law;
- The employer employed the employee pursuant to an employment permit under the Hours of Work and Rest Law or the Youth Employment Law, which was granted or amended due to the emergency situation.
Employer Indemnification for Social Benefit Costs During Reserve Duty Service
As a reminder, already shortly after the outbreak of the war, many employers expressed concern that under the existing law they bore a heavy burden, since they were entitled to reimbursement from the National Insurance Institute only in respect of the gross salary paid to employees during reserve duty periods, but not in respect of the full costs of employing reservists, including pension contributions, National Insurance payments, and ancillary benefits.
On April 29, 2026, the National Insurance Law (Amendment No. 265), 2026 was published, anchoring the said indemnification mechanism as a permanent arrangement. The main points of the amendment are as follows:
Effective Date of the Amendment
The provisions of the amendment will enter into force on the date of publication of the law or on the date of publication of the State Budget Law for 2026, whichever is later, and they will apply with respect to reserve duty service from April 1, 2026 onward.
Indemnification Rate
20% of the employee’s daily income amount, multiplied by the number of reserve duty days served by the employee, provided that it does not exceed the maximum benefit as defined in Section 270 of the National Insurance Law. The indemnification is intended to cover payments made by the employer to a provident fund, pension fund, or similar fund, as well as insurance contributions paid by the employer for the same period.
Exceptions
The amendment does not apply to a “public employer” – the State, a budgeted body or a healthcare corporation as defined in Section 21 of the Foundations of the Budget Law, 1985, as well as a health fund. In addition, indemnification will not be granted if the employer was entitled, in respect of the same payments and the same period, to indemnification under Section 376 of the National Insurance Law.
Reminder Regarding the Retirement Age Law (Parent Whose Child Has Died), 2017
We would like to remind you that as of January 1, 2025, the temporary provision in the Retirement Age Law (Parent Whose Child Has Died), 2017, was anchored as a permanent arrangement, such that an employer employing more than 25 employees may not require an employee who is a bereaved parent, who has been employed at the workplace for at least five consecutive years immediately prior to reaching mandatory retirement age, to retire due to age during the four years following his or her attainment of mandatory retirement age. The law does not apply to a pilot employed in a position for which a maximum age lower than mandatory retirement age has been determined, a firefighter, police officer, prison guard, employee of the Israel Security Agency or the Institute for Intelligence and Special Operations, or a security guard of the Witness Protection Authority. As part of the amendment, the seniority requirement for eligibility was also updated, so that five years of service are now required instead of seven years.
This memorandum is written in the masculine form for convenience only, but is intended for all genders alike. We invite you to contact us as needed with respect to implementation of the matters set out in this memorandum.
Kind regards,
Labor Law Department
