Employer of Record (EOR) in Israel

Hire in Israel in days, with no entity and no exposure to getting Bituach Leumi, mandatory pension, or dismissal procedure wrong. We place you with the right vetted EOR partner, at pricing you will not get going direct, and stay on your side for the life of the relationship.

  • Independent advice
  • Vetted partners
  • Operational in days

What an Employer of Record does for you in Israel

An Employer of Record is a company that legally employs your Israeli staff on your behalf. You choose the person and direct their work day to day. The EOR is the legal employer on paper, which is what lets you build a team in Israel without forming your own company.

In practice the EOR partner takes on everything that needs an Israeli legal entity and local expertise: a compliant employment contract, monthly payroll with income tax, Bituach Leumi (National Insurance) withholding across both contribution brackets, the mandatory occupational pension and severance-fund (pitzuim) contributions, and every statutory benefit Israeli law requires, from annual leave to a lawful pre-dismissal hearing if an exit ever becomes necessary.

01

Legal employer, on paper

A compliant Israeli employment contract, with all statutory terms correct from day one.

02

Compliant from day one

Monthly payroll, income tax, Bituach Leumi withholding, the mandatory pension and severance-fund contributions, and all statutory filings to the Israel Tax Authority and the National Insurance Institute.

03

No entity required

Statutory benefits, annual leave, notice and severance under Israeli law, and a lawful pre-dismissal hearing (shimu’a) if an exit is needed. You get a working team in days; the EOR carries the legal weight.

How it works: four steps to a compliant hire

From first call to a compliant Israeli hire at work, usually in days.

01 – Scope & quote

We map the role, salary, and start date, and come back with a clear all-in monthly cost. No guesswork, no hidden extras.

02 – Compliant contract

Your employment contract is drafted to Israeli standards by the partner, and we sanity-check the terms and pricing before you sign. Compliant from day one.

03 – Onboard in days

A correct Israeli contract is issued, with all statutory terms from day one. Your hire can start in days.

04 – Payroll & compliance run

Income tax, Bituach Leumi, and the mandatory pension and severance-fund contributions calculated and withheld, payslips issued, statutory filings made to the Israel Tax Authority and the National Insurance Institute. You direct the work; the compliance just runs.

What EOR in Israel costs

Two parts: the statutory cost of employing someone, and the EOR partner fee. In Israel the statutory employer cost runs through Bituach Leumi’s two-tier bracket structure, plus a separate mandatory pension and severance-fund contribution, rather than one flat rate. We make both transparent before you commit, so there are no surprises.

Employer Bituach Leumi

4.51% of pay up to NIS 7,703/month, rising to 7.6% above that (to a NIS 51,910/month ceiling). On top of that, a separate mandatory 6.5% pension and 6-8.33% severance-fund contribution apply on salary up to the average wage. Predictable and fully costed before you commit.

Minimum wage (2026)

NIS 6,443.85 per month from 1 April 2026, one national rate with no regional variation.

Income tax (employee)

Progressive scale from 10% to 47%, plus a 3% surtax above NIS 721,560/year (50% effective top rate). Withheld monthly at source from the employee’s pay under the PAYE-style nikui mas bamakor system. Borne by the employee, not added to your cost.

EOR partner fee

A transparent per-employee monthly fee. We benchmark across our vetted network, typically 15 to 25% below going direct, and renegotiate for you at renewal.

Why run it through Bradford Jacobs

We know which EOR partners are genuinely strong in Israel, by sector and by complexity. We place you with the right one, at pricing you will not get going direct, and stay on your side for the life of the relationship.

Independent, not a single provider

We are independent: we assess what you actually need, place you with the right vetted partner, secure pricing you will not get going direct, and stay on your side to escalate or renegotiate. You get advice, not a product pitch.

  • Independent advice
  • Vetted partners only
  • On your side at renewal

Pricing you can’t get direct

Israel’s employer cost splits across a two-tier Bituach Leumi bracket, plus a separate mandatory pension and severance-fund contribution, which makes it easy for an unfamiliar quote to under- or over-price a monthly fee. We benchmark across our partner network for rates typically 15 to 25% below going direct, and renegotiate on your behalf at renewal. Most companies do not know how much room there is to negotiate. We do.

  • 15-25% below direct
  • Network benchmarking
  • Renegotiated for you

Straight to the top when it matters

When something needs resolving, and in global employment it sometimes does, you come to us. We escalate directly, past the helpdesk, to people who can actually move it.

  • Direct escalation
  • No support queues
  • Named account contact

Two decades across markets

Two decades placing and managing EOR arrangements across global markets, with the local knowledge of Bituach Leumi’s contribution structure, the mandatory pension and severance fund, and Israeli dismissal procedure that keeps you compliant.

  • EOR specialists
  • Bituach Leumi & pension
  • Risk removed

Built for conversion to your own entity

Most companies use EOR for 12 to 24 months, then move to their own Israeli Ltd. We plan that crossover and manage the transition when the economics justify it.

  • EOR to entity path
  • Transition managed
  • Crossover planning

Why an EOR is the fastest compliant way into Israel

Two things slow foreign employers down in Israel: the time to incorporate, and the risk of getting the mandatory pre-dismissal hearing, notice, and severance rules wrong. An EOR removes both.

Working time, leave & contracts

Compliance handled under Israel’s protective statutory framework. Israeli employment law requires mandatory Bituach Leumi contributions, a mandatory occupational pension, and a pre-dismissal hearing (shimu’a) before any termination, rather than at-will exit. An EOR carries all of it correctly from day one, so a wrong assumption never becomes a liability.

Operational in days, not weeks

Incorporating an Israeli Ltd typically takes one to two weeks via the Registrar of Companies, and you cannot legally employ anyone until registration completes. An EOR removes that wait entirely: a compliant Israeli contract is issued and your hire starts in days. You prove the market first, then incorporate later only if the headcount justifies it. This is the real value of EOR in Israel: speed into a talent-dense, dual-bracket market, with the compliance carried by an expert.

Everything your Israeli EOR covers

One transparent monthly fee per employee covers all of this. No hidden extras.

Compliant Israeli contract

A compliant Israeli employment contract, issued and maintained for you.

Payroll, Bituach Leumi & pension

Monthly payroll run, with income tax, Bituach Leumi, and the mandatory pension and severance-fund contributions calculated, withheld, and filed correctly each month.

Statutory benefits

All statutory benefits administered: paid annual leave, public holidays, maternity and paternity leave (funded by the National Insurance Institute), and a lawful pre-dismissal hearing and statutory notice on exit, since Israel is not at-will. Employee Bituach Leumi and health tax run 1.04% National Insurance plus 3.23% health tax (4.27% combined) up to the reduced-rate threshold, then 7% National Insurance plus 5.17% health tax (12.17% combined) above it, deducted from salary, not billed to you.

Compliance & support

Ongoing HR compliance and a single point of contact, for the life of the engagement.

Your questions answered

Straight answers on how Employer of Record works in Israel.

Is my hire employed by Bradford Jacobs or by me?

Legally, your hire is employed by the Israeli EOR partner we place you with, which is what keeps you compliant without an entity. Day to day they work for you: you set the work, the goals, the relationship. You get the team; the partner carries the legal employer obligations.

Usually within days once the role and salary are agreed, with a compliant Israeli contract from day one. Compare that to the one to two weeks Registrar of Companies incorporation can take, during which you cannot legally employ anyone.

Predictable, but bracketed: employer Bituach Leumi runs 4.51% up to NIS 7,703/month and 7.6% above it, plus a separate mandatory 6.5% pension and 6-8.33% severance-fund contribution. Add the transparent EOR partner fee and you have your all-in cost.

Yes, when done properly. The EOR is a real Israeli legal employer meeting all Bituach Leumi, pension, tax, and dismissal-procedure obligations. The risk is using an under-resourced partner, which is exactly why we place you with vetted partners and stay on your side.

The compliant contract, monthly payroll (income tax, Bituach Leumi, and mandatory pension/severance-fund withholding), employer contributions, statutory benefits and leave administration, and ongoing HR compliance. We give you one all-in monthly figure up front, with no hidden extras.

Yes, and most companies do once the headcount and permanence justify it. We manage the transition from EOR to your own Israeli Ltd, and can support the incorporation itself. Most use EOR for 12 to 24 months first.

Ready to hire in Israel?

Tell us the role and we will come back with a compliant, all-in monthly cost and the right partner, usually within a day. No entity, no lock-in, no pitch, just the fastest compliant way to get your person working in Israel.

Tax and labour data verified July 2026 (Bituach Leumi / National Insurance Institute, Israel Tax Authority, PwC). Figures change; we confirm the current position when we scope your hire.