Court Rules Against Self-Employed Man Seeking Higher Injury Benefits

A self-employed car importer, born in 1967, suffered a right shoulder injury in a work accident on January 16, 2023. The National Insurance Institute (Bituah Leumi) initially paid him injury benefits for 55 days, calculated based on a monthly salary of NIS 12,308, using his 2020 tax assessment, the latest available in the system. Nearly a year after the accident, his 2022 tax assessment arrived, showing business income of NIS 292,453, averaging about NIS 25,000 per month.

He sued to have his benefits recalculated based on this new assessment. However, on September 24, the Regional Labor Court in Tel Aviv rejected his claim. Senior Judge Rivka Tzadik and public representative Dorli Elmagor ruled that the determination of disability, even temporary, prevents any update to the salary basis for benefits.

Previously, on September 10, 2023, the man had received a letter from the Institute stating that his injury benefits would be recalculated based on the new assessment once it was received, as the initial payment was for less than 91 days. However, a month later, a medical committee determined temporary disability of 25% from March to July 2023, and 15% until January 2024. In December 2023, the Institute approved the disability pension but refused to update the salary basis, citing Regulation 11 of the National Insurance Regulations (Advances). This regulation designates an injury qualifying for a disability pension as a 'blocking benefit,' meaning the income used for advance payments before the injury is considered final.

The self-employed man, represented by attorney Inbal Tamam, argued the letter constituted a binding administrative promise and sought recalculation based on NIS 18,750 monthly (75% of NIS 25,000). The court, however, referenced a precedent from the National Labor Court, which stated that Regulation 11 serves to prevent self-employed individuals from altering their tax assessments after an accident to increase their benefits. The court found the regulation's wording clear, stating that establishing eligibility for a disability pension, even temporary, blocks any update to the insured's salary basis based on a later assessment.

The National Insurance Institute, represented by attorney Gali Alfasi Basson, contended that the man and his accountants had negotiated with the tax assessor for nearly a year. They argued that during the hearing, the self-employed man admitted he rushed to report the 2022 assessment only after receiving the letter. The court expressed doubt about the credibility of the late assessment, noting it cast a "heavy shadow" on his conduct. The court also ruled that even if the earlier letter was misleading, a well-established legal principle holds that a mistake by a National Insurance Institute official cannot grant benefits contrary to law and regulations. Furthermore, it was not proven that the man changed his situation to his detriment based on the letter. The court decided not to award costs against the self-employed man, stating it was 'for the sake of goodwill and not without hesitation.'