Employing a foreign worker through a subcontractor
Sep 18, 2024
By: Shlomi Hadar, Attorney*
The Regional Labor Court in a decision regarding the liability of main contractors in relation to subcontractor employees.
In February 2024, a ruling was issued in the Regional Labor Court (Honorable Judge Ido-Ben Tzur) in a lawsuit by a foreign worker (" Plaintiff ") against a company engaged in the construction industry (" Defendant ", " Company "), in which the defendant , which it claims is not the plaintiff's primary employer , was held liable for unlawful dismissals and employment conditions.
By: Shlomi Hadar, Attorney*
The Regional Labor Court in a decision regarding the liability of main contractors in relation to subcontractor employees.
In February 2024, a ruling was issued in the Regional Labor Court (Honorable Judge Ido-Ben Tzur) in a lawsuit by a foreign worker (" Plaintiff ") against a company engaged in the construction industry (" Defendant ", " Company "), in which the defendant , which it claims is not the plaintiff's primary employer , was held liable for unlawful dismissals and employment conditions.
The facts of the case
The defendant is a private company engaged in the construction industry, which carried out a project in the Lehavim settlement (the " Site "), within the framework of which the plaintiff was employed, according to the company , through a subcontractor to work on the site.
The lawsuit began after the plaintiff was unlawfully dismissed by the defendant after 20 months of work in which he was employed under conditions that were inconsistent with his basic rights as an employee.
The defendant is a private company engaged in the construction industry, which carried out a project in the Lehavim settlement (the " Site "), within the framework of which the plaintiff was employed, according to the company , through a subcontractor to work on the site.
The lawsuit began after the plaintiff was unlawfully dismissed by the defendant after 20 months of work in which he was employed under conditions that were inconsistent with his basic rights as an employee.
According to the plaintiff, he was employed directly by the defendant and did not receive from her the minimum social conditions to which he is entitled as an employee. On the other hand, the defendant claimed that there was no employee-employer relationship between it and the plaintiff, since the construction work on the site was carried out by subcontractors, who employed the workers. However, the company was unable to identify the subcontractor who actually employed the plaintiff.
The parties' claims
The discussion
The Regional Labor Court ruled that in this case, where the identity of the subcontractor could not be determined, the company would be liable as the main employer. It was also determined that the company was required to issue pay slips and deposit amounts for the employee into the Foreign Workers Deposit Fund, as required by law. In addition, the company was ordered to pay compensation for unlawful dismissal and lack of a hearing, convalescence pay, holiday pay, and overtime pay. In total, the employee was awarded compensation in the amount of approximately NIS 84,000, including NIS 32,000 for pension provisions and severance pay, and NIS 13,845 for overtime.
Author's notes:
A lawsuit of this type demonstrates the great importance of labor laws in the employment of foreign workers and the additional importance of employment agreements with subcontractors within the framework of various projects. In the above matter, it must be assumed that if it were possible to indicate the identity of a subcontractor and present an agreement that regulates the division of responsibility between the main contractor and the subcontractor, the result would be different and the exposure of the main contractor would be small.
· Partner at John Geva, Hadar & Co.
The Regional Labor Court ruled that in this case, where the identity of the subcontractor could not be determined, the company would be liable as the main employer. It was also determined that the company was required to issue pay slips and deposit amounts for the employee into the Foreign Workers Deposit Fund, as required by law. In addition, the company was ordered to pay compensation for unlawful dismissal and lack of a hearing, convalescence pay, holiday pay, and overtime pay. In total, the employee was awarded compensation in the amount of approximately NIS 84,000, including NIS 32,000 for pension provisions and severance pay, and NIS 13,845 for overtime.
Author's notes:
A lawsuit of this type demonstrates the great importance of labor laws in the employment of foreign workers and the additional importance of employment agreements with subcontractors within the framework of various projects. In the above matter, it must be assumed that if it were possible to indicate the identity of a subcontractor and present an agreement that regulates the division of responsibility between the main contractor and the subcontractor, the result would be different and the exposure of the main contractor would be small.
· Partner at John Geva, Hadar & Co.
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