Meitav Pension Fund to Refund 1.2 Million Shekels to Members Over Improper Fee Hikes

The Tel Aviv Regional Labor Court approved a class-action settlement against Meitav Pension Fund, requiring the company to refund 1.2 million shekels to 10,500 members of the Default Pension Fund. The dispute arose after Meitav raised management fees for members who became "inactive", defined as having no contributions for 12 months, even when they later resumed payments. The Capital Market Authority clarified that fee increases are prohibited during the first 10 years of membership in the Default Pension Fund.

One plaintiff, Or Treiber, joined the fund in May 2017 with fees of 1.31% on contributions and 0.01% on accumulated funds. After a 21-month break, he resumed payments in January 2020, only to face a fee hike to 2.49%. Treiber sued Meitav for 1,827 shekels individually and led a class action totaling 3.5 million shekels.

Meitav argued that the policy was uniformly applied according to fund regulations, and some members actually benefited from the fee adjustments. Since March 2023, the company has updated its systems to maintain fixed fees for 10 years. Under the settlement, Meitav will refund 75% of the nominal fee difference to affected members. Active members will receive refunds via a seven-month fee waiver, while inactive members will get direct payments if the refund exceeds 50 shekels. Fees will also be adjusted back to the original rates at the time of joining.

Meitav will not reclaim fees from members who benefited from the changes. The total payout amounts to approximately 1.17 million shekels, averaging about 111 shekels per person. The lead plaintiff will receive 4.5% of the refund sum, and his lawyer 17.5%.