Moral Damages and Breach of Good Faith — A Growing Trend in Israeli Labor Court Rulings
In recent years, Israeli labor courts have increasingly awarded compensation for emotional distress (agmat nefesh) and breach of the duty of good faith, especially in cases where the employer has violated the employment contract and failed to uphold the employee’s statutory rights.
In case Saa”sh 49832-04-19, decided on October 25, 2021, Hon. Judge Boaz Goldberg of the Haifa Regional Labor Court ruled in favor of an employee who resigned under the doctrine of constructive dismissal due to a substantial deterioration in employment conditions.
The employer:
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Did not make pension contributions,
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Deducted amounts from payslips but failed to transfer them,
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Violated the employment contract and the duty of good faith.
The court recognized that the employee had to seek basic rights through litigation. Considering that he had worked for 22 years, held a senior position, and suffered significant shortfalls in rights — including incorrect salary calculations — the court ordered ₪20,000 compensation for emotional distress.
Moreover, the court pierced the corporate veil, holding both the company owners and affiliated entities personally liable for statutory obligations.
📌 Conclusion:
Employees can now seek not only:
✔️ Statutory entitlements (pension, overtime, severance),
but also:
✔️ Damages for emotional harm and breach of good faith.
If you’ve experienced a similar situation, we are here to help.
Attorney Yaakov Shnitman — professional, dedicated representation in labor law.
