Labor Dispute (Nazareth) 27940-03-20 Dvir Cohen – Amud Farm Ltd. - part 21

Proportional share Total   69,154

314. In general, Dvir's claim for 13 salary is partially accepted, so that he is entitled to the sum of NIS 69,154.

Study Fund

315. In his statement of claim, Dvir placed his claim in respect of a study fund in the amount of NIS 71,100 in accordance with  grade 7 and alternatively in the amount of NIS 38,700 in accordance with the lowest standard rank that arises with seniority, in accordance with section 50 of the Administrative Extension Order (sections 52-53 of the statement of claim).  In his affidavit,  Dvir put his claim at NIS 65,025 (paragraph 59 of the affidavit) and attached a  calculation (Appendix 13).  In his summaries,  Dvir placed his claim in the amount of NIS 71,000 for the share of an employee and an employer (section 88).
316. In their statement of defense, the defendants denied Dvir's entitlement to a study fund (section 87), andin his affidavit, the defendant objected to Dvir's calculation, which included the sum of NIS 2,500 as part of his determining salary, in addition to including a period that had become obsolete in his calculations, according to them.  In their summaries,  the defendants argued that if the court determines that the expansion orders in the agricultural sector apply, the defendants reiterate what was  stated intheir statements of defense (section 20).
317. As for our decision, after examining the parties' arguments and evidence, including  Dvir's calculation, we decided to accept the claim and charge the defendant the sum of NIS 24,353, for a study fund.  Let us explain.
318. Section 50 of the Administrative Expansion Order states: "In order to ensure the students' continuing education, the employees shall be added to a recognized continuing education fund known as Geron Reut, or Kahal..." In accordance with Section 50, the rates of deposits depend on the employee's rating.  An employee with a rating of 3-4 is entitled to 1% contributions at the expense of the employee + 3% at the expense of the employer, in a level 5-6 contribution at the expense of the employee  is 2% + 6% at the expense of the employer, and in a rating of 7 and above, 2.5% at the expense of the employee + 7.5% at the expense of the employer.
319. Since the burden of proving his entitlement to the sum claimed in respect of the study fund is on Dvir, he must prove his entitlement to the standard 7 level, a burden that he did not meet. A perusal of the statement of claim shows that apart from a vague claim that was made casually (paragraph 52 of the statement of claim), Dvir has no explanation, and certainly no proof, that the standard level to which he is entitled is actually 7.  The aforesaid is sufficient to reject the calculation made on his behalf according to the level 7, andto accept the alternative calculation according to the  lowest grades 3-4.  To complete the picture, we will add that our explanations regarding the determination of the standard level as raised in the discussion of  the economic fees component above are also appropriate to Dvir's claim in relation to the standard grade for the purpose of calculating the study fund.
320. Therefore, Dvir is entitled as of 03/2013-09/2019, to the sum of NIS 24,353 in accordance with the following calculation:

321. More than necessary, we will clarify that we reject Dvir's argument in his summaries (paragraph 88) of his entitlement to an employee and an employer's share, since in the statement of claim Dvir petitioned to charge the defendants with an employer's share only (section 52), and in the framework of the calculation that he attached to his affidavit he petitioned for the employer's share only, and  this is sufficient to determine that this is an expansion of a prohibited front.
322. In general, Dvir is entitled to compensation for the lack of a contribution to the study fund, in the sum of NIS 24,353.

Investment Funds - "Seriousness Fees"

323. The parties disagree regarding the sums transferred by the plaintiffs to the defendant in the years 2013-2016, their nature and the plaintiffs' entitlement to restitution. The parties also disagree regarding the court's jurisdiction to hear these arguments.
324. According to Dvir, in 2013, and in response to his request to improve the conditions of his employment, the defendant offered to transfer to the defendant the sum of NIS 96,000 as seriousness fees – to ensure seriousness in the work, in exchange for a future profit percentage (paragraph 8 of the affidavit, Dvir's testimony at paras. 1-14, p. 15 of the protégé). Dvir agreed and transferred the sum of NIS 96,000 in cash to the defendant (Dvir's testimony: p. 15 of the protégé).  The transfer of the sum of NIS 96,000 was not documented in the document or receipt.  In his testimony before us, Dvir stated that he refused to sign the agreement that the defendant had given him, and that the defendant had promised him to transfer him a new agreement, but in practice such an agreement was not transferred.  Ultimately, Dvir did not receive his money back and did not receive money from the farm's profits (paragraph 9 of the affidavit, testimony of Dvir: paras. 37-39, p. 16, paras. 1-5,   33 of the protégé).
325. Noam made similar claims (paragraphs 10-11 of his affidavit), and detailed that in 2016, he transferred to the defendant the sum of NIS 70,000, in cash, as a seriousness fee in exchange for part of the farm's profits (Noam's testimony: paras. 37-39, p. 43, paras. 9-19, p. 44, paras. 28-33, p. 47 of the proceeds), and that the defendants did not document the seriousness fees they received in the document or receipt (Noam's testimony: paras. 32-33, p. 43 of the protégé) and did not return the sum of NIS 70,000 despite the fact that the defendant promised to transfer it (Appendix 13 to Noam's affidavit).
326. On the other hand, the defendants claimed that Dvir and Noam were hidden partners and that they were offered to sign agreements but they refused (paragraph 12 of the summaries, paragraphs 22-34 of the defendant's affidavit  in the Dvir case,  paragraphs 24-34 of the defendant's affidavit in the Noam case, Appendix 1 to the defendant's affidavit).  The defendants added that after disclosing the farm's financial statements to the plaintiffs and the plaintiffs realized that the farm was in  losses, the plaintiffs decided to terminate their employment and demand their money in order to avoid participation in the farm's losses (paragraph 41 of the defendant's affidavit  in Dvir's lawsuit).
327. As for Dvir, the defendants admit that in 2013 they received the sum of NIS 96,000, in cash, and these were kept in a safe (the defendant's testimony: s. 3-6, p. 29 of the prot.), and claimed that the sum constitutes an initial investment of a total of NIS 800,000 that Dvir undertook to complete in exchange for 20% of the value of the herd, in accordance with the mechanism outlined in the partnership agreement (paragraphs 25-29 of the defendant's affidavit in Dvir's lawsuit, testimony of the defendant: paras. 34-35, paras. 37-38, p. 25 of the prot.). The defendant further claimed that the sum of NIS 96,000 was returned to Dvir in full, starting in 2016, after Dvir asked to receive a salary increase and was rejected by the defendant, then  the defendants agreed to accept Dvir's request to receive a sum of NIS 2,500 per month from the sum of NIS 96,000 that he transferred to the farm, after Dvir promised to improve the condition of the farm and increase its profits (paragraphs 23, 35-39 of the defendant's affidavit in Dvir's lawsuit).  According to the defendant,  the sum of NIS 96,000 was returned in full to Dvir, with  the  sum of NIS 10,000 transferred to him every four months (the defendant's testimony: S. 8-13, S. 19, p. 29 of the protégé).
328. As for Noam, the defendants repeated the same arguments they raised in relation to Dvir regarding the mechanism and nature of the payment received from Noam. The defendants denied that Noam transferred the sum of NIS 70,000 and claimed that on January 16, 2017, Noam transferred the sum of NIS 48,900 in cash and refused to complete the balance, claiming that he purchased a drone and an oven for the farm at his own expense (paragraph 34 of the defendant's affidavit  in Noam's lawsuit, paragraph 26 of the defendants' summaries, the defendant's testimony: s. 26, s. 37, p. 30 of the prut).  In his testimony before us, the defendant claimed that these funds were deposited into the farm's bank account and recorded as serious fees in the farm's books (S. 8, S. 10-11, p. 30, S. 5, p. 31, S. 27-28, p. 31, S. 31-35, P. 31).
329. Jurisdiction of the Tribunal – According to the defendants, the Tribunal lacks substantive jurisdiction to hear the claims of the plaintiffs in respect of the defendants' reimbursement of the seriousness/investment fees. On the other hand, the plaintiffs claimed that the defendants took the seriousness pay as part of the employment relationship, in order to prove seriousness in the work and as a deposit, and therefore petitioned to obligate the defendants to return them.
330. In order to decide the dispute that arose between the parties, we must decide the question of what was the nature of the relationship between the parties in relation to this component of the lawsuit, whether a partnership agreement was entered into between the parties, whether the plaintiffs were hidden partners as claimed by the defendants or whether it was a serious fee paid by the plaintiffs in order to improve the terms of their employment, and therefore no partnership relationship was created between the parties.
331. As for our decision, after considering the arguments of the parties, their testimonies and reviewing all the material in the file, we have reached the conclusion that the court lacks jurisdiction to hear the plaintiffs' claim for the restitution of the alleged seriousness fees , so that their claim on these elements should be dismissed. We will reason. 
332. The legal framework – section 24 of the Labor Court Law, 5729-1969 – determines which claims the Labor Court will have exclusive jurisdiction to hear, "and for this purpose it adopts tests in which the question of cause of action is given central status – in some matters the authority of the Labor Court is determined by the cause of action, and in other matters it is determined both by the cause of action and by the identity of the  Thus, for example, in a claim under section 24(a)(1) of the Labor Court Law – which is the relevant section in our case – the jurisdiction of the court was defined according to the identity of the parties (employee and employer) and according to the cause of action (labor relations).  If so, in order for a claim to fall within the jurisdiction of the Labor Court under section 24(a)(1) of the Labor Court Law, it must meet two cumulative tests with a "positive" basis: First, the parties to the action must be employees and employers, or those who have had an employee-employer relationship in the past...Second, the cause of action must stem from the employment relationship.  Compliance with these two tests is a necessary condition, but not a sufficient one, since they are joined by a third test, which has a negative basis – the cause of action is not a tort under the Torts Ordinance.  To complete the picture, it should be noted that the cause test outlines the definition of the powers in the framework of other alternatives listed in section 24(a) of the Labor Court Law" [Civil Appeal Authority 2407/14 Moran Ruham v. Agence France Peres Ltd., dated October 14, 2015, hereinafter – the Ruham case, Civil Appeal Authority 54059-11-25 David Israel v. Kibbutz Reshafim et al., dated December 16, 2025,  Application for Leave to Appeal (National) 67197-01-17 Rotem Gispan - Best Refrigeration Services in a Tax Appeal, dated 03/04/2017, hereinafter – the Gispan case].
333. As to our decision, there is no dispute that the test of the identity of the parties exists, and therefore we shall turn to examine the test of the identity of the cause. In order to examine the grounds, it is first necessary to examine the statements of claim and the wording of the causes of action in their framework (the Ruham case, the Gispan case).  Paragraph 63 of Dvir's claim  states the following: "The plaintiff will claim that during 2013 the defendant approached him and asked to invest NIS 96,000 in the defendant and in return be entitled to 20% of the defendant's profits.  The defendant argued to the plaintiff that the farm is profitable and presents handsome profits and that it is a worthwhile investment.  The plaintiff paid the defendant the sum of NIS 96,000 and the defendant undertook to provide him with a receipt for the payment and an agreement, but the plaintiff did not receive anything from the defendants, neither a receipt for the payment, nor documents, nor profits nor his money", and in paragraph 67 of the statement of claim, Dvir petitioned to obligate the  defendants "to pay the sum of NIS 96,000, together with interest and linkage differences, in favor of the plaintiff, for the return of the said funds that were given to the defendant 'as a profitable investment' and have not been returned to him to this day." See with the necessary changes, paragraphs 53 and 57 of Noam's statement of claim, see also S. 16, p. 17, S. 3, p. 23 for the transcript of the conversation between Noam and the defendant, Appendix 19 to Dvir's affidavit, Appendix 13 to Noam's affidavit).  This means that the statements of claim do not indicate a cause of action stemming from  the employment relationship between the parties.
334. The plaintiffs, and apparently, based on the defendants' claims of the lack of jurisdiction of the court, changed their claim with respect to the funds transferred to the defendants.  This  is how Dvir stated  in paragraph 66 of his affidavit: "In accordance with my work format described above and my salary, I contacted the defendant with a demand to improve my working conditions.  The defendant claimed that I manage the farm and that the profitability of the farm depends on my work.  The defendant suggested that in order to improve my working conditions, I would pay a total of NIS 96,000 as seriousness fees, which would entitle me to about 20% of the farm's profits.  Thus, according to the plaintiff, I will increase my salary and the defendant will ensure that I am serious about my work" (see the required changes, paragraph 60 of Noam's affidavit).  In our opinion, this is an extension of a prohibited front, in which the plaintiffs are trying to adapt the cause of action to the labor law (the matter of their spirit), and therefore their claim should be dismissed, if only for this reason alone.  However, we are persuaded that the law of their claim is also rejection on the merits of the matter.
335. The argument that the monies taken by the defendants from the plaintiffs were made in the framework of the employment relationship or for the purpose or during the employment relationship does not, in itself, establish a cause of action originating from the employment relationship as claimed, even if implicitly in the plaintiffs' summaries (paragraphs 124-125, 129 of the Dvir summaries, paragraphs 112, 115-116 of the Noam summaries). The plaintiffs' claim that they transferred the money to the defendants as a condition for improving their employment conditions is inconsistent with their claim in the statement of claim as detailed above, nor is it  consistent with logic and common sense, according to which an employee is required to pay money in order to receive a raise or improvement in his employment conditions.
336. On their version that they transferred the money to the defendants as an investment in exchange for part of the farm's profits, the plaintiffs reiterated their testimonies before us.  In his testimony before us, Dvir was asked  what the essence of those serious fees was, and he replied, "If I am good, then I will receive from it the dividends corresponding to the amount I invested" (Dvir's testimony: paras. 4-6, p. 15 of Prut, and see also his words in the preliminary hearing of June 10, 2021, paras. 3-5, pp. 3  of Prut there).  While Noam was asked why he transferred money to the defendants, he replied  "to receive dividends" (his testimony: S. 32, p. 47 of Prut, his statement at the preliminary hearing of June 10, 2021, S. 26-27, p. 3 there).  Noam stated that he transferred the money to the defendants after the defendant told him, "Come and put the seriousness fees and start receiving dividends from the profits of the farm, and that's how he convinced me to go back and work on the farm" (his testimony: paras. 9-11, p. 44 of the protégé).  This is also evident from  the recorded  conversation between Noam and the defendant, in which the following was said:

"Noam: 70,000 shekels.