Labour law7 min read8/31/2026

Pay or Shifts Were Cut: When Resignation Is Deemed Dismissal in Israel

A single inconvenient change in the work schedule is not enough: for purposes of severance pay, the deterioration must be substantial, and it must itself be the reason for the resignation. Written objection, giving the employer an opportunity to remedy the situation, and documents showing the loss of pay in shekels are all critically important.

Numbers and facts

•Minimum employment period required for severance pay — generally one year
•In the Golan case, the employee continued working for 8 months
•Ordinary waiting period for unemployment benefits in the case of voluntary resignation — 90 days
•When the workplace is relocated, the unemployment-benefit criterion — more than 60 km
•For a mother whose child is under 7 years old, the criterion — more than 40 km

When Resignation Becomes Resignation Deemed Dismissal

Under Section 11(a) of the Severance Pay Law, 5723-1963, resignation due to a substantial deterioration in working conditions or due to circumstances in which the employee cannot be required to continue working is deemed dismissal for purposes of severance pay. Employment for at least one year with the same employer or at the same workplace is generally required. The employee must prove three things: an objectively serious deterioration, a causal connection between it and the resignation, and prior warning to the employer if the violation can be remedied. A subjective feeling that working conditions have worsened is not enough.

Pay and Shift Cuts: Where the Line Is Drawn

A unilateral reduction in the agreed pay is a typical example of a potentially substantial deterioration. A reduction in shifts may also qualify if it significantly reduces the scope of employment and actual income, but not every change in the work schedule creates an entitlement to compensation. The Labor Court compares the previous and new conditions, the duration and extent of the change, the employee’s position, and its effect on the employee’s income. Other violations are also relevant: delayed payment of wages, degrading treatment, and failure to implement protective provisions in labor laws, a collective agreement, or an extension order. Before making a material change to pay, the scope of the position, the role, or the workplace, the employer must also hold a hearing and allow the employee to present their position.

How to Warn the Employer in Writing

The letter must state the specific change: for example, the date of the pay cut, the previous and new number of shifts, or the difference in shekels between pay slips. It must then clearly state that you do not agree to the deterioration, demand restoration of the previous conditions, and provide a reasonable opportunity to remedy the violation. It is advisable to warn that if the violation is not remedied, you will be forced to resign due to a substantial deterioration in working conditions and will demand that the resignation be deemed dismissal for purposes of severance pay. The legal provisions do not establish a uniform number of days for correction; the reasonableness of the period depends on the violation. If the employer is objectively unable to remedy the deterioration, or there is little likelihood that it can be remedied, prior warning may not be required, but the ordinary advance-notice obligation for resignation must still be observed.

What Evidence Should Be Preserved

Keep the employment contract, notices concerning working conditions, pay slips from before and after the change, attendance reports, shift schedules, and bank statements showing deposits. It is preferable to export correspondence with the manager from the workplace system and send the demand letter in a manner that allows proof of delivery. If you were informed of the change orally, immediately send a brief written summary of the conversation that includes the date and the substance of the decision. In the resignation letter, again state the specific deterioration, the prior warning, the fact that no correction was made, and the connection between these circumstances and the resignation. Wording such as “I am resigning for personal reasons” may conflict with a later claim that the reason was a cut in pay or shifts.

Why Silence and Continuing to Work Are Risky

The closer the resignation is in time to the deterioration in conditions, the easier it is to prove the causal connection, although the provisions do not establish an automatic maximum period. In the Yohanan Golan case, the National Labor Court considered a situation in which the employee objected to a unilateral change but continued working for 8 months under the worsened conditions without resigning or filing a claim. The Court viewed his conduct as consent to the new conditions. Nevertheless, under harmful conditions, the Court may take into account the vulnerability of minimum-wage workers who are forced to remain employed until they find another job. Therefore, delay does not always defeat the claim, but silence makes proof significantly more difficult.

FAQ

Can I resign and receive severance pay after a few shifts are cut?

Possibly, if the reduction substantially decreased the scope of employment or income and was not merely a minor adjustment to the work schedule. The old and new work schedules, attendance reports, and pay slips showing the actual impact of the change will be required.

What happens if the employer restores my previous pay after I complain?

If a remediable violation is corrected and the employee nevertheless resigns, entitlement to severance pay based on deterioration in conditions generally does not arise. The employer’s response and the actual restoration of the conditions should therefore be examined before submitting the final resignation notice.

Must a demand letter be sent first?

Yes, generally: reasonable warning must be given to the employer, along with an opportunity to remedy the violation. An exception may apply when correction is objectively impossible or when there is little likelihood that the deterioration will be eliminated.

Am I entitled to severance pay if I worked for less than one year?

Entitlement to severance pay due to a substantial deterioration in conditions generally requires at least one year of employment with the same employer or at the same workplace. Other rights may arise during a shorter period of employment, for example for wages not paid in full, but that is not equivalent to severance pay.

Can unemployment benefits be obtained without waiting 90 days?

Resignation under justified circumstances may sometimes allow the ordinary waiting period to be avoided, but the criteria for unemployment benefits differ from the rules applicable to severance pay. When the workplace is relocated, the criterion is more than 60 km from the home, or more than 40 km for a mother whose child is under 7 years old, subject to meeting the remaining eligibility conditions.

What to do next

First document the previous and new conditions, calculate the actual difference based on pay slips and shifts, and demand correction of the situation in writing. Do not sign consent to the change, and do not cite “personal reasons” if the true reason for the resignation is the deterioration in conditions. Before stopping work, it is advisable to separately verify the employment period, advance-notice rules, and evidence of the causal connection in light of your circumstances.

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