By Shai Nimrodi, Partner

In 2018, the Population and Immigration Authority issued Directive No. 5.3.0043 outlining procedures for handling requests from tech and cyber companies seeking to employ foreigners in Israel. According to this directive, a company registered as an Israeli company in the Israeli Companies Registrar is entitled to submit an application to employ a foreign expert as a specialist in the tech company. Submission under this directive grants the company several advantages, including the ability to employ a foreign academic graduate according to the terms specified in the directive.

Eligibility Criteria for Tech Companies

Firstly, as mentioned, the company must be recognized as a tech company according to the regulations of the Ministry of the Interior and the Innovation Authority. For this purpose, an application must be submitted with an appropriate declaration, and only after the company has been classified as a tech company by the Innovation Authority, can it proceed to submit requests under this directive.

Employment of Foreign Academic Graduates

According to Section V.3 of the directive, the company is entitled to employ a foreign academic graduate (“the graduate”) without the obligation to pay expert wages (i.e., double the average wage in the economy) if the foreign candidate meets the following conditions: they have completed studies and received an academic degree in one of the tech fields from an Israeli institution of higher education, not more than 3 years have passed since the completion of the degree, and the tech company has committed to paying them a salary of at least 150% of the average wage in the economy starting from the seventh month of their employment. During the first six months of employment, the tech company must pay the graduate a salary not less than the minimum wage, and all other relevant employment conditions are subject to Israeli labor laws. It should be noted that this directive limits the quota for employing foreign academic graduates and foreign students by tech companies, with a maximum quota of 500 permits in total.

Application Process for Employing Foreign Tech Graduates 

Among other documents that the tech company must complete and submit as part of the application, it must also include confirmation from the institution of higher education in Israel that the graduate whose employment is sought is entitled to a degree in one of the tech fields and includes the date of entitlement to the degree.

Ministry of the Interior Review

After the application is submitted, the Ministry of the Interior will examine the documents, and if necessary, the company will be asked to complete missing documents or correct deficiencies within 21 working days from the date of receipt of the request by the Ministry of the Interior. Generally, a decision by the Ministry of the Interior regarding the matter will be made within 30 working days from the completion of the document submission process, and in case additional documents are recommended by an advisory committee or upon the committee’s request, the processing time will be extended by an additional 30 days.

Work Permit and Extensions

If the application is approved and a work permit is issued for the graduate, the permit will be granted for a period of up to three years from the date of the graduate’s degree completion, and after receiving the permit, the company and the graduate will approach the Ministry of the Interior to issue a Type 1 work permit (academic graduate), which will be issued once a year and can be extended according to the permit’s validity period.

As long as the graduate resides legally in Israel, there will be no need for them to leave Israel to obtain a Type B-1 work permit, and after three years from the date of their degree completion, the tech company will be entitled to submit an application to the Ministry of the Interior for a work permit for them as a foreign expert under the Expert Route for Tech Companies.

Specialized Legal Assistance

Kan-Tor & Acco law firm specializes in finding solutions for cases that do not fit these regulations specifically and has extensive experience in applying the regulations to both startups and more established technological companies.