ISRAEL – Reduced minimum salary for foreign gas and oil workers. 

March 28, 2025

By: Charlotte Branigan, Associate, Newland Chase Advisory

The decision to lower the salaries of foreign workers in the onshore gas and oil drilling sector aims to make the sector more attractive and reduce costs for employers. Furthermore, this change could stimulate investment in the industry within Israel.

The Israeli government has made a significant announcement affecting the onshore natural gas and oil drilling industry, which will specifically impact foreign national workers. The move aims to address rising operational costs in the sector by reducing the expected salaries for foreign nationals employed in these operations.

The Ministry of Energy and Infrastructure raised concerns about the high cost of bringing foreign expert workers into the offshore drilling sector, which also requires complex operations, specialized equipment, and substantial investment. These costs have been identified as a significant obstacle to the sector’s further development.

Currently there are two routes for employing foreign expert workers in Israel’s gas and oil drilling sector. Foreign workers in this industry are currently employed on temporary permits, either for three months or one year. The short-term permit allows foreign workers to stay for up to three months, but they cannot continue working once their visa expires. The long-term permit allows workers to stay for up to a year, but it requires a salary that is twice the average Israeli wage and places a financial burden on employers. Both pathways have been deemed financially burdensome.

Aligning foreign worker salaries with international standards.

To make the industry more cost-effective and competitive, the government proposed aligning foreign worker salaries with international standards. Given the extensive training required for Israeli workers and the sector’s reliance on foreign expertise, reducing foreign worker costs is seen as essential for continuing operations and expansion.

The authorities will revise the procedure for employing foreign workers in roles involving unique technology and machinery. Specifically, the requirement that 50 percent of the workers on a project must be Israeli will be lifted for onshore gas and oil drilling projects. This change is expected to reduce the cost of employing foreign workers in the sector and stimulate further investment in exploration and drilling. Additionally, onshore projects will now be classified under the unique technology and machinery category, allowing these projects to employ more than 50 percent foreign nationals in their workforce.

This news alert is for informational purposes only and does not constitute legal advice. For case-specific guidance or further information, please contact Newland Chase directly.