What a New Labour Court Ruling Says About the Position of Trust Exemption and Overtime
Many foreign companies employing people in Israel rely on a “position of trust” clause to keep senior staff outside overtime rules. On 10 September 2026 the Tel Aviv Regional Labour Court held that such a clause was worth nothing because the job itself did not match it. This article sets out what the court decided, why, and what it signals for employers, without giving legal advice on your own arrangements.
What is the position of trust exemption in Israel?
The position of trust exemption is a carve-out in section 30(a)(5) of Israel’s Hours of Work and Rest Law, 1951 (unofficial English translation hosted by the ILO). It removes from the Law’s protection employees in management roles, or in roles that require a special degree of personal trust. Where the exemption genuinely applies, the Law, including its overtime rules, does not apply to that employee.
For foreign companies employing in Israel, the clause is attractive. Senior hires often work long and irregular hours across time zones, and a contract line stating that the role is one of personal trust looks like a tidy way to settle overtime in advance. In the ruling discussed below, the court said these exemptions are construed narrowly, so that fewer employees fall outside the Law, and it placed the burden of proving the exemption on the employer.
The case: Avrahami v Ir HaShaashuim Ltd (Superland)
The Tel Aviv Regional Labour Court gave a partial judgment (פסק דין חלקי) on 10 September 2026 in case סע”ש 15845-09-22. The claimant, Matan Avrahami, worked for Ir HaShaashuim Ltd (עיר השעשועים בע”מ), which owns and operates the Superland amusement park. The panel was Judge Sharon Shavit Kaftori, with public representatives Avshalom Eisner (employees) and Dalia Kutai (employers).
The relevant employment period ran from 20 January 2014 to 19 July 2022. Mr Avrahami was first manager of the booths department and later manager of security, guarding and safety at Superland.
A note on names: some secondary coverage refers to the defendant as “כפר השעשועים”. The judgment itself names the company as עיר השעשועים בע”מ, and that is the name used here.
What the employer argued
The employer relied on a written employment agreement dated 8 August 2017. It stated that his was a senior role requiring a special degree of personal trust, and that the Hours of Work and Rest Law therefore would not apply.
The employer also paid him a global overtime component of roughly ₪1,000 to ₪2,000 a month. Mr Avrahami disputed ever signing the 2017 agreement, and both sides filed graphology opinions on the signature.
What the court held on the position of trust exemption
The court held that the employer failed to prove that Mr Avrahami held a management role, or a role requiring a special degree of personal trust, under section 30(a)(5). The court looked at what the job actually was, not at what the contract called it.
These were the court’s reasons, and they are the practical core of the ruling:
- Not senior management. He was not part of senior management, did not sit on the board, and was not shown to set company policy.
- No independent authority. He could not independently dismiss staff, set employment terms, approve budgets or bind the company.
- He reported upwards on site. He reported to a more senior manager on site, which undercut the claim that he sat in the senior management layer.
- Ordinary pay. His pay was not exceptional management-level pay, and the employer produced no data at all about what its actual management earned.
- His hours were recorded. The employer kept attendance records and he clocked in and out, so supervising his hours was plainly possible.
- The employer paid overtime anyway. Paying a global overtime component weakened the employer’s own argument that he sat entirely outside the Law.
- No training for the safety role. He received no training for the safety manager role.
- A distant witness. The employer’s only witness was not on site and was not his day-to-day manager.
Why the contract clause did not save the employer
The court did not decide whether the 2017 agreement was forged, because it did not need to. Even assuming Mr Avrahami signed it, a contract cannot contract out of cogent statutory rights where the statutory exception is not actually made out.
Put simply, the agreement can evidence what the parties intended, but it cannot override the Law. A position of trust clause is judged on substance, not wording. If the facts of the job do not meet section 30(a)(5), the clause does not carry the employer across the line.
Label versus substance: how the court weighed each factor
The table below sets what the employer relied on against what the court found. It summarises this judgment only and is not a checklist for any other role.
| Issue | What the employer relied on | What the court found |
|---|---|---|
| Written agreement | 2017 clause calling the role one of special personal trust | Cannot override cogent statutory rights where the exception is not made out |
| Seniority | Senior role | Not senior management, not on the board, reported to a more senior manager on site |
| Authority | Claimed management role | No independent power to dismiss, set terms, approve budgets or bind the company |
| Pay | No data produced on management pay | Not exceptional management-level pay |
| Supervision of hours | Role outside the Law | Attendance records kept and he clocked in and out, so hours could be supervised |
| Global overtime | Roughly ₪1,000 to ₪2,000 a month paid | Weakened the exemption argument, and was not shown to match hours worked |
| Breaks | Deduct one hour a day | Refused; no proof he actually had a real break in which he could disconnect |
Global overtime pay and attendance records: the uncomfortable part
Two very common employer habits worked against this employer. Keeping attendance records showed that his hours could be supervised. Paying a global overtime figure showed that the employer itself treated him as someone the Law applied to.
On global overtime specifically, the court held that where attendance records exist, it is not enough for an employer to say a global component was paid. The employer must show the component was fair, reasonable, transparent, and actually matched the hours worked. This employer showed no ongoing check of that kind.
On breaks, the employer asked the court to deduct an hour a day. The court refused, because the employer did not prove that he actually received a real break during which he could disconnect from work. General procedures, and documents about other employees, were not enough.
For foreign companies the point is direct. A position of trust clause, a clock-in system and a flat monthly overtime line can sit side by side in the same employment file. In this case, the second and third of those undermined the first. Whether that would happen in any other case depends on its own facts.
The outcome, stated precisely
The sum awarded is not final, and the ruling is a first-instance decision. Both points matter before anyone quotes a figure from this case.
- Overtime, Sabbaths and holidays: Mr Avrahami was awarded ₪253,157, less an offset for global overtime paid in months where he did not in fact work overtime. The final figure is not yet fixed. The parties have 30 days to file an agreed calculation, and the file returns for review on 29 October 2026.
- Breach of the Law and distress: his claim for ₪50,000 was dismissed, no separate damage having been proven.
- Wage Protection Law: this claim was dismissed. The court found the payslips were not fictitious.
- End of employment: he resigned on the strength of an occupational physician’s certificate that he was unfit for the role. This was not a dismissal, and he received no pay in lieu of notice.
- Employer’s counterclaim: the employer’s counterclaim for ₪38,439 (a ₪29,239 severance top-up plus ₪9,200 notice) was dismissed. The employer had known about the medical certificate at the time and chose to pay.
- Costs: ₪20,000 was awarded against the employer.
How much weight does this ruling carry?
This is a first-instance decision of a regional labour court, and there is a right of appeal to the National Labour Court. It is not settled law and it is not binding precedent. It is also a partial judgment, with the final overtime figure still to be calculated.
What it does offer is a clear, recent example of how a regional labour court tests a position of trust claim. The reasoning follows the narrow reading of the exemptions that the court described, and it focuses on the facts of the role rather than the words in the agreement.
What this signals for foreign companies and EOR buyers
The signal is that the exemption has to be earned by the job, not declared by the contract. A title, a clause and a reasonable salary did not carry this employer across the line when the employee had no independent authority, reported upwards, and clocked in.
CWS Israel is not a law firm and this is not legal advice. How any of this applies to a particular role depends on its facts, and anyone relying on a position of trust clause for Israeli staff should take advice from Israeli employment counsel on their own arrangements. For background on the wider compliance picture, see our guide to the HR compliance audit for Israel.
If you employ in Israel through an Employer of Record, the EOR is the legal employer and runs payroll, including how hours and overtime are recorded and paid. CWS Israel, an SIA member with 12 years’ experience and PwC-verified compliance, provides Employer of Record services in Israel and payroll outsourcing in Israel. Answers to common questions are on our EOR Israel FAQ.
Frequently Asked Questions
What is the position of trust exemption under Israel’s Hours of Work and Rest Law?
Section 30(a)(5) of the Hours of Work and Rest Law, 1951 excludes employees in management roles, or in roles requiring a special degree of personal trust, from the Law’s protection. In the Avrahami ruling of 10 September 2026, the Tel Aviv Regional Labour Court said these exemptions are construed narrowly, and the employer bears the burden of proving the exemption applies.
Can an employment contract exclude an Israeli employee from overtime pay?
In case סע”ש 15845-09-22, the court held that a contract cannot contract out of cogent statutory rights where the statutory exception is not actually made out. The agreement can evidence what the parties intended, but it cannot override the Law. The court reached that view even assuming the employee had signed the agreement.
Does paying global overtime protect an employer in Israel?
Not on its own, according to this ruling. Where attendance records exist, the court said the employer must show the global component was fair, reasonable, transparent, and actually matched the hours worked. Paying it also weakened this employer’s argument that the employee sat entirely outside the Law.
How much was awarded in the Avrahami v Ir HaShaashuim case?
The court awarded ₪253,157 for overtime, Sabbaths and holidays, less an offset for global overtime paid in months where he did not in fact work overtime. The final figure is not yet fixed. The parties have 30 days to file an agreed calculation, and the file returns for review on 29 October 2026. Costs of ₪20,000 were awarded against the employer.
Is this ruling binding on other Israeli employers?
No. It is a first-instance decision of the Tel Aviv Regional Labour Court, with a right of appeal to the National Labour Court, and it is a partial judgment. It is a useful illustration of how the court approached a position of trust claim, but it is not settled law or binding precedent.
Why did the court refuse to deduct break time?
The employer asked for an hour a day to be deducted, but did not prove the employee actually received a real break during which he could disconnect from work. The court held that general procedures, and documents about other employees, were not enough.
Employing in Israel? Talk it through with CWS Israel
We run compliant Employer of Record and payroll arrangements for foreign companies in Israel. For legal questions about a specific role, we will point you to take advice from Israeli employment counsel.
