Working in Israel for a US company (salary question)

amother

Tue, Feb 20 2024, 9:37 am

I realize that US companies like to hire employees from Israel because they can then pay a lower rate- but I'm curious if there is any justification for this?

I work for a successful US business. The management lives in Israel but the company earnings are USD. Is there any reason for me not to be paid according to US standards?

Success10

Tue, Feb 20 2024, 9:45 am

It's a big topic of debate also in the world of freelancers. My personal opinion is yes it's fair to pay people in Israel less money because people in Israel are generally happy with the lower salary as it can go further over here. And furthermore, why should people overseas hire someone in Israel if for the same money they can hire someone locally on the same time zone. It doesn't make sense. They are compromising to some extent.

shabbatiscoming

Tue, Feb 20 2024, 10:20 am

amother OP wrote:

Yes, you are paid israeli standards because you live in israel and the management is in israel.
Its just the way it is. Is it fair? Well, if you thought the salary wasnt fair, you didnt have to take the job.
I workee for 2 such companies over the last 20 years. The salary was always low. But I needed a job and irmt was what I found.

amother

Tue, Feb 20 2024, 10:34 am

Success10 wrote:

actually they say that they want employees from Israel so that the team can meet in person

Success10

Tue, Feb 20 2024, 11:21 am

amother OP wrote:

actually they say that they want employees from Israel so that the team can meet in person

Interesting. Definitely different than what I was referring to. It's basically an Israel based company. So you're paid according to Israel salary standards, which also makes sense.

amother

Tue, Feb 20 2024, 12:03 pm

Success10 wrote:

Interesting. Definitely different than what I was referring to. It's basically an Israel based company. So you're paid according to Israel salary standards, which also makes sense.

But they have US consumers and their products are priced according to the US market.

amother

Lightblue

Tue, Feb 20 2024, 12:07 pm

If you live in israel, and you work for an israel based company, you get paid according to israeli market value. Same way if you live in florida and work for a floridian comapany, even if they service new yorkers, you will be paid according the the florida market, not the new york market. It's just how it works.

amother

Impatiens

Tue, Feb 20 2024, 12:29 pm

amother OP wrote:

You have to look at it like youre a mexican. Its very hard for americans to find jobs in israel so american companies use that to their advantage and hire them and pay horribley low salaries, just like apple hires indians to do the rep jobs.

amother

Marigold

Tue, Feb 20 2024, 12:39 pm

What you have is different then the usual companies

An Israel based company will pay according to Israel based salary - especially because that means they are also paying Israeli taxes, which is a brutal tax code for businesses.

What is unfair and taking advantage, is when you have an american company in the US outsourcing to israel paying minimum Israeli wage because often Americans in Israel don't have many job options, while the people working in the american office are making salaries much higher then the american minimum wage, and are getting more then double for the same work.

I once worked for a company like this - they where paying me minimum israeli which was 9$ an hour. Now I know that Israeli employer requirements are higher so it costs them 25% more then my salary - so I cost them about 12$ an hour.
Meanwhile, in the american office my coworkers where being paid $30-35 an hour, for the sme work, working for the company for the same amount of time!
If I would have been paid 22-25$ an hour, it would be fair - the being out of office/out of the country a payout makes sense. But taking advantage pf me like that was just not ok - I left and was promptly hired by another american company for 22.5$ a hour with a really nice yearly raise...

amother

Marigold

Tue, Feb 20 2024, 12:47 pm

amother OP wrote:

I appreciate the replies.
I don't think it's good that we allow these companies to take advantage in this way.
Can anyone recommend an online salary calculator (for average pay based on experience)?

I think you are not being fair to the company.
Reality is supply and demand. Companies will pay the lowest they can for the quality of work they need. If the salary is not subpar on Israeli standards I don't see it as taking advantage when they are completely based here.

BTW
It is really hard to be an Israeli based company selling products in the states. They have to pay taxes in both countries (even though there is a treaty, it gets complicated when there are big sums of money involved)

The bigger issue is that outside of hi-tech, it is very hard to find salaried positions making more then 15k with a decent work life balance. Unless you are an atzmai - and then the tax code really punishes atzmaim. It is not a country that really encourages entrepreneurs and small businesses, which isn't a robust small business economy, and why the salaries are staying low.

Success10

Tue, Feb 20 2024, 2:54 pm

amother Marigold wrote:

I agree with what you said about the amounts. $9 an hour is just ridiculous. It's fair to pay less to Israelis, but not a mere fraction of the US going rate.

amother

Marigold

Tue, Feb 20 2024, 3:12 pm

Success10 wrote:

I agree with what you said about the amounts. $9 an hour is just ridiculous. It's fair to pay less to Israelis, but not a mere fraction of the US going rate.

When I tried to speak to them they said that $9 an hour is 30 nis an hour which is minimum wage and is what I would be paid if I was working for an israeli company doing customer support. Which was true at the time - I had friends working for bank leumi making 30 nis an hour doing customer service. I was happy for the job as I student (I worked US hours at night after college classes all day) until I found out what the US co-workers hired in the states at the same time where being paid.

I get paying less for outsourcing - but for a company to hire me to do the same work as a co-worker making 35$ an hour, with the same education, work experience, and time in the company was just off.

Success10

Tue, Feb 20 2024, 3:26 pm

amother Marigold wrote:

It's just interesting to analyze that you would have been happy for the 9$ an hour had you not found out what your US counterparts were making. I think it's like that in many areas of life, what we have is enough but it irritates us that others have so much more.

I'm getting a bit deep here, I guess, but it ties into what you're saying about what is a fare way to gage how much of a salary difference is suitable if one lives in Israel. Perhaps it's just a matter of perspective....

amother

Cantaloupe

Tue, Feb 20 2024, 3:39 pm

I work as a part time secretary for someone in America, I get paid approx $20 p/h which is great for israel and cheap for him. he anyway needed someone remotely due to privacy of clients so instead of taking someone in usa he looked in Israel.
I am an Atzmai so I also get benefits in Israel like high Maanak Avoda, by Covid and now for the war. Im not American so I dont have to pay taxes in USA on in Israel.
Yes it is harder hours to work.

amother

Marigold

Wed, Feb 21 2024, 5:52 am

Success10 wrote:

Yes and no - I would have been ok with the job as a short term student job, I never would have stayed longer then a year in that job.
In Israel the lower end minimum wage jobs tend to have a huger turnover, people come and go as soon as they find someone better. Meanwhile my employers was looking for longer term employee's who would stay a couple of years minimum. He was making a mistake by looking at what the big corporations in Israel pay - they have mainly students, russian olim who don't have lots of options, or arabs who have a lower cost of living.
For the quality of work that he was looking for her really did have to pay what my next employer paid which was a starting slary of 22$ with growth opportunities. I have heard from other employee's that they have raised to 18$ an hour, because he saw he couldn't keep employee's at that rate.

notshanarishona

Wed, Feb 21 2024, 5:57 am

These companies definitely take advantage, finding highly educated Americans and paying an Israeli salary (with no Israeli benefits). If they would at least treat everyone like people with sick days and maternity leave the minimum pay wouldn’t be as insulting but getting $10 and a 1099 is just not fair. That being said, it’s a rough job market in Israel if you aren’t fluent in Hebrew. I worked remotely for a good few years and eventually got sick of the ridiculous pay (started at $7 an hour)😢

juggling

Wed, Feb 21 2024, 6:04 am

If it's an Israeli company they are going to pay Israeli rates, even if the company's earnings come from abroad. The company is paying local taxes and is bound by local laws. Presumably they also pay your bituach leumi and pension, and give you Israeli vacation days, etc.

People working for an American company and getting paid in dollars are either evading taxes or paying self-employment tax, bituach leumi, social security, etc. straight off their paycheck. In which case their take-home pay is probably way lower.

In any case, yes, it's fair. Large international companies that have offices in multiple countries, each office pays differently, based on the local market rates and local tax laws.

amother

Marigold

Wed, Feb 21 2024, 6:10 am

juggling wrote:

Depends - I get payed on W2 and when I file as an atzmai my accounted calculates what was paid in america and deducts it from my bill. I still make a really decent wage post tax

DVOM

Wed, Feb 21 2024, 6:10 am

amother OP wrote:

I appreciate the replies.
I don't think it's good that we allow these companies to take advantage in this way.
Can anyone recommend an online salary calculator (for average pay based on experience)?

I think it's great for the companies!