Israel's Mass Coronavirus Layoffs Leaving Tens of Thousands Without Jobless Benefits

Pension-age workers, newly released soldiers and foreign guest workers don’t qualify for help when they’re laid off or out on unpaid leave

Empty streets in Jerusalem's Old City amid the coronavirus pandemic, March 20, 2020.
Ohad Ziegenberg

Among the hundreds of thousands who have been laid off or put on unpaid leave due to the coronavirus, there are perhaps tens of thousands who don’t qualify for unemployment benefits because they are past Israel’s official retirement age, are soldiers who have worked less than six months since they were discharged or are foreign guest workers.

“Unfortunately, the government has chosen not to include older workers above the official retirement age among the groups that qualify for unemployment benefits who are put on unpaid leave or laid off due to the coronavirus,” said MK Meirav Cohen (Kahol Lavan). “The decision to deny them jobless benefits will push them into a life of difficult poverty. An old-age allowance of 2,300 shekels [$637] won’t get them through the month.”

Haaretz Weekly Ep. 70Haaretz

As a result, said Alex Tenzer, the head of a nongovernmental organization that helps contract workers, because the figures don’t take into account people not entitled to jobless benefits, the number of people hurt by the recent wave of layoffs and unpaid leave is a lot higher than the state employment service's figures show.

As of early Sunday, that number had jumped to nearly 512,000, or 16.5% of Israel’s workforce, as industries such as travel and tourism languish during the global pandemic.

Shlomo, a 76-year-old musician from Tel Aviv, has worked for a decade in marketing for a company offering hair-removal services. He’s typical of the kind of Israelis left adrift by the sudden onset of layoffs and unpaid leave over the last two weeks.

“I’m working because I have no choice ... and this what lets me live with some dignity, said Shlomo, who asked to be identified by his first name only. “The minute this job ends, it’ll be a real problem. I admit I wasn’t cautious about ensuring myself a pension – I’ve only begun accumulating rights over the past 10 years. I declared bankruptcy a few years ago and have no safety net.”

According to the cleaning companies association, about 30% of all cleaning workers have lost their jobs or have been put on unpaid leave, and the number will only grow.

The association says older workers, who account for about a quarter of the total, should not have to go to work, because they are at a higher risk of contracting the coronavirus, but in many cases they are too old to qualify for unemployment benefits. Many have minimal pension benefits and would have to live on the government’s old-age allowance alone.

The Israel Security Association, an umbrella group of companies providing security guards, says about 40,000 workers in the sector have been put on unpaid leave or have been laid off. The industry employs many people of pension age.

It is believed that about 20,000 foreign workers in the tourism and restaurant sectors are now out of a job. They aren’t entitled to unemployment benefits if they have been put on unpaid leave and have no health insurance.

The Israel Restaurants Association has asked Finance Minister Moshe Kahlon to immediately release money that has been deposited by asylum seekers in a fund, instead of when they leave Israel, as is normally the case. The association says the fund would aid some 10,000 asylum seekers who were employed at restaurants and now have no means to support themselves.

“This is a grave injustice, both to the workers and to the businesspeople in the restaurant sector, who are facing very difficult times,” the association said in a letter to Kahlon.

Meanwhile, the NGO Physicians for Human Rights has appealed to the Capital Markets Authority to tell insurance companies to ease premiums paid by unemployed foreign workers for medical coverage.

“We’ve already been approached by hundreds of workers who’ve been laid off – from hotels, from restaurants that have already closed, and from nursing care workers who fear for their jobs,” the organization’s Zoe Gutzeit said in the letter. “In addition to the workers’ difficult financial circumstances, they now face the risk of losing their health insurance and, with it, access to medical care.”

Physicians for Human Rights estimates that about 100,000 immigrant workers and 30,000 asylum seekers in Israel are not insured by the state. Most of them have private policies designed for foreign workers by companies such as Harel, Menora and Ayalon. However, coverage is contingent on being employed.

A foreign worker between jobs can keep his or her policy for 90 days but must prepay for the entire period. Gutzeit said she was concerned that many would now lose their coverage because they aren’t aware of the 90-day rule and/or because they can’t cover the prepayment.

In any case, since no one can say how long the pandemic will keep them unemployed, they risk losing their medical insurance when the 90 days are up. Gutzeit is asking that coverage for the unemployed be extended for at least 180 days and that prepayment terms be eased.

She added that the health care system would benefit from enabling foreign workers to keep their coverage. In ordinary times, jobless guest workers often delay getting medical care until their situation deteriorates to the point that they end up in emergency rooms, at a high cost to the health care system.

“They not only pay dearly for their health, but it also creates a heavy economic burden on the hospitals costing about 60 million shekels annually,” she said.