This summary of age discrimination in Israel has been prepared by Herzog Fox & Neeman www.herzoglaw.co.il.

Overview

Israel has an extensive regime of statutes prohibiting employment discrimination. The central anti-discrimination statute in Israel is the Employment Equal Opportunities Law, (1988) (“Equal Opportunities Law”), which prohibits employment discrimination in relation to hiring, terms and conditions of employment, benefits, promotions, vocational training, termination and severance pay, and retirement benefits, all on the basis of gender, race, age, nationality, country of origin, religion, place of residence, sexual orientation, parental status, fertility treatments, marital status, political affiliation, viewpoint and  military reserve service. This list is not exhaustive. In addition to the Equal Opportunities Law there are other legislation that refers to equality in the workplace, such as Equal Pay Law- 1996 and Equal Rights Law for Disabled Persons – 1998.  

Age discrimination has been prohibited under the Equal Opportunities Law since 1995. Unlike in some other countries, the protected group is not defined in terms of a specific age threshold, but rather any classification based on age is susceptible to a claim of age discrimination.

In bringing a claim of age discrimination, an individual need not show a concrete reason for the discrimination, but merely demonstrate that specific "less favourable" treatment occurred. The employer must then show that there is a legitimate reason for its actions. An employee/candidate can also bring a complaint of age discrimination where the employer's actions are indirect. For example, terminating the most expensive employees in a redundancy exercise may amount to indirect discrimination against older employees who are longer serving and may therefore have higher salaries.  

Who is covered?

The Equal Opportunities Law covers all employees as well as job applicants. In addition, the Equal Opportunities Law prohibits an employer from discriminating against any employee who has been placed with the employer by a manpower contractor, as defined under the Employment of Workers by Manpower Contractors Law (1996), or who was referred by the manpower contractor to the employer, in regard to accepting the work assignment, completing the work assignment and the conditions of the work place, arising from the abovementioned criteria.

What enforcement/remedies exist?

Liability for a violation of the Equal Opportunities Law attaches to the "employer," be it a person or a legal entity.  When a legal entity is the one that breaches the Equal Opportunities Law, any manager or official of that entity may also be regarded as responsible for the breach, unless he or she proves that the breach was without his or her knowledge or that he or she took all appropriate steps to prevent such breach.

The principal remedies for discrimination are monetary damages or injunctive relief. Although Israel is a common law legal system, which usually rejects enforcement of employment relationships, the Equal Opportunities Law provides for such enforcement when circumstances permit. The Equal Opportunities Law provides for statutory damages without proof of loss.

As well as an employee or candidate, an employee representative body in the workplace (or if none, a union to which an employee belongs) may bring a civil claim against an employer in respect of a breach of the Equal Opportunities Law. 

Any individual may also submit a written complaint to the Regional Commissioner of the Equal Opportunities Commission ("EOC"), a body established under the Equal Opportunities Law, regarding a breach of the equality at work legislation. Following an investigation, the Regional Commissioner may file a claim against the employer (on behalf of the complainant or on behalf of the EOC). Following a request from the EOC, the court also has power to order an employer to take certain action to comply with the legislation.     

A breach of the Equal Opportunities Law may also form the basis of a class action, as well as exposing the employer to potential criminal liability.

How common are claims?

Claims based on age discrimination are relatively common.

What claims are most common and what are the trickiest issues for employers?

The most common claims brought by employees on the basis of age relate to termination and retirement benefits. 

Are there any specific exceptions in your law? 

A statutory defence is available to employers when they can demonstrate that a decision based upon an otherwise discriminatory ground is justified due to a bona fide occupational necessity. This defence has been interpreted extremely narrowly by the courts. Such justified occupational necessities have included safety reasons and role model considerations in religious educational institutions.  

Retirement

Under the Retirement Age Law, (2004), ("Retirement Age Law"), mandatory retirement is legal when an employee has reached the age of 67, although following case law (see below), this is subject to certain procedural requirements. The High Court of Justice in Gavish and others v the Knesset (21 April 2016) HCJ 9134-12 has determined that having a legal mandatory retirement age per se is not unconstitutional.

Under the Retirement Age Law, as a general rule, an employee may choose to retire voluntarily and receive retirement benefits at the age of 67 for men, and between 62 and 65 years old for women, depending on the employee's date of birth.

Interesting cases

The case of Ephraim Recanat v. National Labour Court, (10 December 2000) 4191/97 concerned a provision under a collective agreement applicable to the airline El Al and its employees, under which flight attendant staff were compelled to retire at the age of 60, whilst the retirement age for other employees was 65. The grounds for such distinction was that the role of a flight attendant required an “attractive physical appearance” and a high level of physical strength. In a further hearing before the Supreme Court, it was held that this constitutes prohibited age discrimination under the Equal Opportunities Law. The Supreme Court held that the retirement age must be equal for all employees of the employer, unless an employee's position justifies setting a different retirement age. The relevant test for this is an objective one:  whether the requirements of a specific position are reasonably required. In this regard, the employer's views are not regarded as decisive but only constitute one of the factors that the court should consider. With regard to the physical strength requirement, the Court stated that this can be assured by a physical examination of an individual. With regard to this specific position, an “attractive physical appearance” cannot justify a separate retirement age. Although an attractive or youthful appearance of a flight attendant was likely to have commercial advantages for El Al, nevertheless, to prefer youthful flight attendants is also the result of the discrimination that has prevailed in the past against the aged, and such discrimination should not be justified in the future. Even if in the short term this may affect the company’s profitability, this was a price that El Al, as with any other employer in Israel, should pay. The promise of equality costs money. However, the demand for equality constitutes a key value not only in public law but also in private law, and this is a price worth paying. In addition, the Supreme Court ruled that discrimination on the grounds of age is also contrary to public policy. Accordingly, despite the fact that the Equal Opportunities Law only added the prohibition of discrimination on the basis of age in 1995, the right against discrimination on the basis of age was also invalid prior to that time, given that it contradicted public policy.

In the case of Board of Agudath Israel Gardens Network v. Simcha Busey (2 October 2011) LA 203/09, Gardens Network was facing severe financial deficits. In order to facilitate the continued operation of the network, a recovery plan was developed, which included, inter alia, the dismissal of all senior female workers who had accumulated over 25 years of seniority. The National Labour Court dismissed the appeal and ruled that layoffs according to seniority, falls under the "compatible age" category and therefore constitutes age discrimination. The entire burden of the deficit, and the need for recovery, should not be mainly placed on the senior female workers.

In December 2012, the National Labour Court in Weinberger v Bar Ilan University (6 December 2012) LA (National) 209-10, handed down a significant precedent, determining that an employee who reaches mandatory retirement age may not be forced to retire automatically. The ruling stated that, in light of the obligations of good faith and decency, the principle of equality and the prohibition on age discrimination, employers must consider an employee’s request to continue working after reaching mandatory retirement age and conduct a hearing on the matter. Only after a hearing has taken place with the employee should the employer reach a final decision about the retirement. As such, the ruling does not prohibit an employer from using age when considering an employee's continued employment, but requires it to exercise discretion and look at each case on its merits, taking into account the employee's personal circumstances and the objective needs of the business.

In December 2016, the Regional Labour Court in Tel Aviv held in the case of Bat Sheva Simchi v Ma'abarot Products Ltd. (4 December 2016) LD 49821-01-16, that even where an employee's specific role is redundant, it is necessary to consider the employee's age, and the possibility of finding alternative work for an employee of an advanced age. The court emphasised that since in this case there was a reduction in force that was due to the employer's needs and not the employee's conduct, the employer was required to consider the employee's age in her favour - it was not enough that her age was not considered negatively.  Not relating to the issue of age, or relating to it neutrally, makes the decision discriminatory. In these circumstances, the employer was required to pay damages of 12 months' salary, in addition to NIS 50,000 damages without proof of loss. The judgment highlights a trend of requiring employers to demonstrate that not only should they not consider discriminatory criteria against an employee when deciding upon termination, but rather they should consider special circumstances, such as age, in an employee's favour to meet their legal obligations.

Most recently in January 2018, the National Labour Court in Katz v El Al Israel Airlines Ltd. 43426-08-14 held that not placing a pilot as a "captain" after reaching the age of 65, and reducing his salary and employment terms as a result, did not constitute age discrimination. This took into account that the Aviation Regulations (Licenses for Aviation Workers) comply with the international standards set out in the Chicago Convention, which prohibit a pilot of this age from serving as a captain. The National Labour Court held that this lawful restriction required the company to change the employee's role from captain to co-pilot, to meet international legal requirements and standards. In this regard, the National Labour Court emphasised that the mere change in salary and employment terms on reaching the age of 65, since the employee could not continue to perform his role as a captain under the Aviation Regulations, was not prohibited discrimination. This was due to the fact that the changes in employment conditions and salary stemmed from a legal restriction, and met the tests of reasonableness and proportionality. It was found to be unreasonable to require the company to absorb the cost involved in restricting a captain over the age of 65 from carrying out his full role as captain and it was therefore unreasonable to require the company to continue to pay his salary as a captain. The situation necessitated the adjustment of salary and employment terms to the position that he could do after the age of 65.

Also in January 2018, the National Labour Court in Shmuel Vagman V. Galil Engineering Ltd. 67949-09-16 held that in certain cases involving termination due to redundancies or organizational changes, prior to commencing the hearing process, employers may face an additional requirement. In this regard, the National Labour Court emphasised that employers have a duty to make an effort to locate an alternative position for certain group of employees (such as employees who are close to retirement age), before proceeding to termination. The court noted that the scope of this duty and the efforts it requires, will vary from case to case and that that duty stems from the duty to act in good faith in the scope of labour relations. It is important to note that the court does not view this requirement by virtue of the result (i.e., whether the employee was indeed transferred to an alternative suitable position or terminated due to the lack thereof), but rather, whether the employer carried out a real and honest process to examine whether there is an alternative position.