Disability insurance for foreign workers in the construction industry
Jul 8, 2024
By: Shlomi Hadar, Attorney
Is someone who employs a foreign worker in the construction industry required to purchase disability insurance for him? The issue was examined in court.
background
The plaintiff arrived in Israel in 2006 after receiving a work permit in the construction industry, and began working for his employer, in a concrete factory, with a personal employment agreement being signed between the parties.
On 27.9.20, during a routine shower at the factory at the end of the workday, the plaintiff felt dizzy and fell. He felt weakness throughout his body, difficulty coordinating, and great difficulty speaking, so he was sent home by taxi. At home, he fell again and was rushed to a hospital, where he received emergency life-saving treatment. The medical diagnosis was that he had suffered a series of cerebral events. As a result, the plaintiff became completely dependent, requiring close supervision around the clock and permanently losing his ability to work.
By: Shlomi Hadar, Attorney
Is someone who employs a foreign worker in the construction industry required to purchase disability insurance for him? The issue was examined in court.
background
The plaintiff arrived in Israel in 2006 after receiving a work permit in the construction industry, and began working for his employer, in a concrete factory, with a personal employment agreement being signed between the parties.
On 27.9.20, during a routine shower at the factory at the end of the workday, the plaintiff felt dizzy and fell. He felt weakness throughout his body, difficulty coordinating, and great difficulty speaking, so he was sent home by taxi. At home, he fell again and was rushed to a hospital, where he received emergency life-saving treatment. The medical diagnosis was that he had suffered a series of cerebral events. As a result, the plaintiff became completely dependent, requiring close supervision around the clock and permanently losing his ability to work.
The parties' claims
According to the plaintiff, by virtue of the collective agreements and expansion orders in the construction industry, the defendant-employer was required to insure him with disability insurance despite the state's great helplessness, which does not take any action against insurance companies that refuse to insure foreign workers, which leads to an unacceptable result, according to which the foreign workers in the factory are disadvantaged, while the Israeli workers are insured with disability insurance and the foreign workers are not.
According to the employer, it did not violate any legal provision, and on the contrary, it acted fully in accordance with the legislator's instructions and the regulator's guidelines, all while taking into account the insurance companies' policy not to insure foreign workers with disability insurance. The defendant adds that even according to the relevant collective agreement, in the plaintiff's case, it was required to deposit only foreign workers, and that the deposit constitutes a substitute for a pension arrangement that includes disability insurance. The employer added and argued that in practice, the plaintiff is trying to indirectly attack arrangements established in primary legislation, and this should not be permitted.
According to the plaintiff, by virtue of the collective agreements and expansion orders in the construction industry, the defendant-employer was required to insure him with disability insurance despite the state's great helplessness, which does not take any action against insurance companies that refuse to insure foreign workers, which leads to an unacceptable result, according to which the foreign workers in the factory are disadvantaged, while the Israeli workers are insured with disability insurance and the foreign workers are not.
According to the employer, it did not violate any legal provision, and on the contrary, it acted fully in accordance with the legislator's instructions and the regulator's guidelines, all while taking into account the insurance companies' policy not to insure foreign workers with disability insurance. The defendant adds that even according to the relevant collective agreement, in the plaintiff's case, it was required to deposit only foreign workers, and that the deposit constitutes a substitute for a pension arrangement that includes disability insurance. The employer added and argued that in practice, the plaintiff is trying to indirectly attack arrangements established in primary legislation, and this should not be permitted.
The court's decision
The court ruled that there was no basis for the plaintiff's claim that his employer had a duty to insure him with disability insurance.
The combination of the provisions of the collective agreement (and the expansion order) and the provisions of the Foreign Workers Law leads to a clear conclusion that an employer of a foreign worker is not required to insure him with any pension insurance, and hence the conclusion that he is not required to purchase disability insurance for him, which is usually one of the components of pension insurance.
An employer who wishes to purchase disability insurance for his employee in addition to deposits into the deposit will also not be able to do so, for the simple reason that there is currently no insurance company or other company that manages pension funds that sells disability insurance to foreign workers.
At the same time, the court criticized the existing situation and determined that the current state of affairs, according to which foreign workers who come to Israel, unlike Israeli workers, are not entitled to any compensation in any case in which they contract an illness during their work that is not recognized as an occupational accident, is unsatisfactory, to say the least .
The court determined that the legislator would be right to act to correct the discrimination and injustice in this state of affairs, by establishing government insurance for loss of work capacity for foreign workers, or at least by creating mutual insurance that would provide a solution, even if only partially, and especially for cases not covered by National Insurance, in a way that would create the required equality of rights between foreign and Israeli workers .
We note that a similar issue was discussed in a proceeding in which an employer was represented by our office when the employee was Palestinian and the place of employment was in the West Bank, when insurance companies refused to insure employees of his type. An outcome of this proceeding, in which the claim ended with the employee's hands on his bottom, was a mechanism initiated by the state to deposit benefits for these employees into a fund from which they could be reimbursed if necessary.
Thus, employing non-Israeli workers raises difficulties and questions, both from the perspective of labor law and insurance. Since an event of loss of ability to work carries a very high potential for damage and risk to the employer, it is best to examine the employment of these workers and the manner in which they are employed.
The court ruled that there was no basis for the plaintiff's claim that his employer had a duty to insure him with disability insurance.
The combination of the provisions of the collective agreement (and the expansion order) and the provisions of the Foreign Workers Law leads to a clear conclusion that an employer of a foreign worker is not required to insure him with any pension insurance, and hence the conclusion that he is not required to purchase disability insurance for him, which is usually one of the components of pension insurance.
An employer who wishes to purchase disability insurance for his employee in addition to deposits into the deposit will also not be able to do so, for the simple reason that there is currently no insurance company or other company that manages pension funds that sells disability insurance to foreign workers.
At the same time, the court criticized the existing situation and determined that the current state of affairs, according to which foreign workers who come to Israel, unlike Israeli workers, are not entitled to any compensation in any case in which they contract an illness during their work that is not recognized as an occupational accident, is unsatisfactory, to say the least .
The court determined that the legislator would be right to act to correct the discrimination and injustice in this state of affairs, by establishing government insurance for loss of work capacity for foreign workers, or at least by creating mutual insurance that would provide a solution, even if only partially, and especially for cases not covered by National Insurance, in a way that would create the required equality of rights between foreign and Israeli workers .
We note that a similar issue was discussed in a proceeding in which an employer was represented by our office when the employee was Palestinian and the place of employment was in the West Bank, when insurance companies refused to insure employees of his type. An outcome of this proceeding, in which the claim ended with the employee's hands on his bottom, was a mechanism initiated by the state to deposit benefits for these employees into a fund from which they could be reimbursed if necessary.
Thus, employing non-Israeli workers raises difficulties and questions, both from the perspective of labor law and insurance. Since an event of loss of ability to work carries a very high potential for damage and risk to the employer, it is best to examine the employment of these workers and the manner in which they are employed.
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