Labor Minister Yoav Ben Tzur. Photo: Knesset Spokesperson
Labor Minister Yoav Ben Tzur (Shas) signed last night (11.3.24) on raising the level of the minimum wage in the economy. Starting next month, April 1, the new minimum wage will be 5,880 shekels per month, compared to 5,572 shekels as of today. This is an increase of regarding 5.3%.
In two-hour terms, the minimum wage until now was NIS 30.61 per hour, and from April 1 it will rise to NIS 32.3 per hour. For the purpose of calculating the minimum wage, a working month includes 182 working hours.
Disability benefits are not linked to the minimum wage. General disability allowance and disabled child’s allowance are linked to the average wage in the economy, and as a result the allowances increased in January 2023 by approximately 9.5%, and in January 2024 by another 5.6%. This is an addition of many hundreds of shekels to these allowances over a period of two years. In contrast, work accident disability allowances are linked to the consumer price index, and therefore increased in January 2024 by approximately 3% – the rate of increase of the index in the previous year.
Who is going to be affected now by the increase in the minimum wage? The former are many instructors who work with populations of people with disabilities, including in hostels, mental health centers, community homes and employment centers, who usually earn minimum wage. These workers will now receive a 5.3% increase in their wages.
In addition, disabled workers who earn an adjusted minimum wage will also benefit from the increase. These are actually people with reduced work capacity compared to workers without disabilities in a similar position, or in other words: their work output is less compared to their counterparts. In their case, the minimum wage is adjusted to their ability to work and is calculated as a percentage of the normal minimum wage.
The determination of the adjusted salary for an employee with a disability is done through a diagnosis in the workplace, which is done in relation to employees without disabilities in a similar position in the same organization. To carry out the salary adjustment, the employee, the job candidate or a proxy on his behalf must submit an application below for the integration of people with disabilities in the labor market. The employer, it should be noted, is not allowed to submit a form on behalf of the employee or job candidate.
The diagnosis is carried out following at least 3 months have passed since the beginning of the employee’s employment at the workplace, to allow a period of adaptation and learning for him and the employer. The decision letter is sent to the employee or a person on his behalf who submitted the request, and the employer is sent a notice of the amount of salary he must pay the employee.
Now, following the increase in the minimum wage, even workers on adjusted wages will receive a 5.3% increase in their wages compared to what they have been earning up until now. For example, an employee with a work ability rate of 19% to 30%, was entitled to a salary of 30% of the minimum wage, and in numbers regarding NIS 1,671.5 per month. As of April 1, this employee will earn NIS 1,764 – an increase of NIS 92.5.
On the other hand, an employee who has a work ability rate of 70% to 80% and is entitled to a salary of 80% of the minimum wage, will benefit from a more significant increase starting next month. If until now his salary was 4,457 shekels per month, then from April 1 he will earn 4,704 shekels – an increase of 247 shekels.
It should be noted that for many years there has been strong criticism of the payment of adjusted wages to employees with disabilities, both in Israel and in many countries overseas. Last month it was reported in “Svivim” Because in Kansas, in the USA, a new law was passed designed to incentivize employers who pay employees with disabilities a wage lower than the minimum wage (adjusted wage) to increase it to at least the minimum wage, and this through a tax benefit for employers. Today, the policy in the US in general allows the payment of adjusted wages to people with disabilities, but from now on, businesses in Kansas that pay in this way will not be able to benefit from a tax credit.
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Kansas: New law will increase the wages of people with disabilities