Israeli Court Approves Class Action Against Rami Levy Over Wage Deductions

A regional labor court in Jerusalem has approved a class-action lawsuit against the Israeli supermarket chain the company, concerning deductions from cashiers' wages for till shortages. The court ruled that a till shortage does not constitute a debt that can be deducted from an employee's salary under the Wage Protection Law, even if the employee signed a form seemingly authorizing the deduction.

The decision, by Judge Rachel Bar-G Hershberg, suggests a likelihood that the case will be decided in favor of the employees. The class includes all Rami Levy employees who worked as cashiers in the seven years preceding the lawsuit's filing and from whom money was deducted for till shortages.

The lawsuit was initiated by two former cashiers, represented by attorney Tzvi Mendelson, after one had 45.7 shekels and the other 257.5 shekels deducted from their pay due to alleged shortages. Rami Levy argued that the deductions followed a set procedure and required written consent, with the branch absorbing the loss if an employee refused to sign. The company claimed the shortages resulted from employee negligence and that signed confirmation indicated the employee's acceptance of responsibility.

The court focused on Section 25 of the Wage Protection Law, which permits deductions for debts based on written employee commitment, limited to a quarter of wages. It determined that a till shortage is not such a debt, emphasizing that the law's intent is not to hold employees liable for damages. The court noted that while deductions are allowed for disciplinary offenses under specific agreements, a till shortage requires complex investigation to determine its cause and responsibility, which may stem from various errors or external factors.

Judge Hershberg stated that accepting Rami Levy's interpretation would render the Wage Protection Law meaningless, allowing employers to deduct any amount arbitrarily. The court found evidence, including company testimony, indicating that employees were often held responsible even when the cause of the shortage couldn't be determined, with one witness stating cashiers were liable if the source of the shortage was unknown. The court also noted that investigations often only occurred for shortages exceeding 100 shekels and that employees frequently signed deduction forms under pressure at the end of their shifts.

The court approved the class-action status, finding it the most effective and fair way to resolve the dispute, especially given that employee rights are non-waivable and individual claims for small amounts might not be pursued. The main proceedings are yet to take place, but the court awarded 25,000 shekels in legal fees to the plaintiffs' attorney and 4,000 shekels in expenses to each of the two plaintiffs. Rami Levy has 30 days to file a defense statement. The court did not rule on other claims, such as breach of good faith or unjust enrichment, at this stage.