Are unused sick days paid out when employment ends in Israel?

The Sick Pay Law lets an employee accumulate 1.5 sick days per month, up to a ceiling of 90 days, to draw on when unable to work due to illness. The statute frames sick leave as protection against loss of income during illness, not as deferred compensation, so there is no statutory right to convert unused days into money on resignation, dismissal, or retirement. This contrasts sharply with the Annual Leave Law 5711-1951, under which untaken vacation days must be paid out (pidyon chufsha) at the end of employment. Many employees are surprised that years of unused sick days simply lapse with nothing to show for them.

For a foreign employee planning to leave Israel, the takeaway is to distinguish the two balances on your final pay slip and Form 161. Demand payment for unused annual leave, which is owed, but do not expect compensation for unused sick days, which is not. The one place to look is your specific contract or any applicable collective agreement (heskem kibbutzi), because some sectors and employers voluntarily allow employees to redeem a fraction of unused sick days, often a percentage payable only on retirement or after long service. If your employer offered such a benefit, get the formula in writing before your last day, since it is contractual rather than statutory and is easy to overlook in the exit settlement. Our guide to sick leave and employee rights explains the underlying accrual rules.

From the full guide: Sick Leave and Employee Rights in Israel

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