If you’re hiring a cleaner for Passover, be wary: a recent survey has revealed that over 60% of employers expose themselves to severe lawsuits by overlooking the need to pay pension and insurance benefits to those they hire.
The findings come via a survey published by Workito, an Israeli company that provides digital payment services for employers of domestic workers. The survey, conducted by Midgam Project Web Panel, examined why Israeli employers don’t pay pension and national insurance to domestic workers.
The researchers polled 700 adult Israelis (aged 30 and above) who employ domestic workers in cleaning, nursing, babysitting, gardening and maintenance.
According to the findings, the main reasons that employers overlook pension and insurance payments are ignorance regarding the employer’s duties (44%), saving on employment costs (34%), paying in cash (33%), the red tape involved in the current payment mechanism (30%), and the employees’ refusal to receive those payments so as not to declare their incomes (29%).
“Non-payment of pension and national insurance to domestic workers, whether consciously or not, turns hundreds of thousands of Israelis into offenders exposed to monetary lawsuits that can reach hundreds of thousands of shekels,” said Workito CEO Doron Amir. “Just as important, this affects the social and pension security of the weakest employees in the labor market, further widening socioeconomic gaps in Israeli society.”
“To deal with the financial risks of non-payment, the state must raise public awareness of employers’ payment duties and the rights of domestic workers,” he added. “Such a move must be complemented by more accessible payment mechanisms. The applications that can already do it have been proven effective, and it is high time that their use be expanded on the national level.”
The respondents were asked what they thought was the most effective way to pay for pensions and national insurance for their domestic workers. According to the survey, streamlining the process using digital platforms (24%), reforming the income security mechanism (23%), raising awareness of the employers’ duty to pay (20%), and increased enforcement (13%) were the most effective.
In order to address the issue, Workito has announced that users will be able to pay pensions with their credit cards, instead of paying through a debit authorization or standing order, as has until now been the case.
Additionally, a new service will enable employers to use their smartphones to open an employer file for a domestic worker directly on the National Insurance Institute website and start paying immediately, without having to wait for approval.