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  • ACRI

Forfeiture of Migrant Workers’ Contributions

In 2019, ACRI joined the Worker’s Hotline in a petition (filed first with the District Court and then with the High Court of Justice) against the practice of forfeiting migrant pension and severance contributions held in a fund. The law requires employers to make contributions to a pension and severance fund for migrant workers who are entitled to receive these funds upon departure from the country. The law further stipulates that if a migrant worker fails to leave the country at the appointed time, they can be fined up to the total sum of these contributions. In other words, the law and the regulations enacted pursuant to it allows stripping migrant workers of their socioeconomic rights if they overstay their visas.

In the petitions, the organizations argued that these provisions are unparalleled anywhere in the world, and an arrangement whereby a person loses their old age pension over failing to leave the country is unheard of. The organizations further argued that the penalty is disproportionate to the offense: A migrant who worked lawfully for 12 years will have accumulated a very large sum of money that would be forfeited if they did not leave. A migrant who lawfully worked for only one month and then remained in the country for 12 years without a permit, would lose only a few hundred shekels, deposited during that first month, while the employer would have to pay the pension accumulated the rest of the years directly as the law requires the employer to pay a pension.

A similar arrangement, approved in a High Court judgment in 2020, has been put in place for asylum seekers, though with several differences. Most importantly, according to the law, contributions made for asylum seekers are higher, and the fine applies mostly to the portion provided on top of the mandatory contributions. In other words, asylum seekers who do not leave on time (and none have had to leave yet) may lose additional contributions made by employers but will get to keep most of their severance and pension pay. This is not the case for migrant workers who lose everything.

On February 9, 2002, the High Court issued an order instructing the state to show cause as to why the law should not be repealed. On November 15, 2002, a hearing was held before an extended panel.

On July 12, 2023, the High Court issued a ruling, striking down the relevant section of the law. The court ruled that a deduction arrangement that could result in all contributions being denied to a migrant worker who worked in Israel lawfully but did not leave on time disproportionately violates the constitutional right to property. The court ordered the Knesset and the relevant ministers to formulate an alternative scheme within six months; otherwise, the deduction arrangement would be revoked.

Case No. 51191-07-19 Zhu Longjun v. Minister of Interior; Case No. 6942/19 Chavano v. Minister of Interior; Case No. 6948/19 Zhu Longjun v. Minister of Interior

Attorneys: Michal Tajer (Worker's Hotline), Oded Feller (Association for Civil Rights)

Case No. 51191-07-19

Court Ruling, October 7, 2019 (Hebrew)

Case No. 6942/19, Case No. 6948/19

State's Response, December 2021 (Hebrew)

Knesset's Response, December 2021 (Hebrew)

Petitioners' Response, January 2022 (Hebrew)

Decision (Conditional Order), February 9, 2022 (Hebrew)

Court Ruling, July 12, 2023 | Summary of Court Ruling (Hebrew)


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