An Israeli employee who was terminated by a Panamanian company, which was registered in Spain and operated in Cuba, some of which shareholders were Israeli, demanded in Israel severance pay under Israeli law even though his employment agreement specifically included a clause stating that the law of Panama applies.
The Court rejected the claim and found that Israeli law does not apply. Even when there is a jurisdiction clause in a country other than Israel, it can be determined that Israeli law applies. When establishing a jurisdiction clause, one must examine what is the forum that has the significant and essential connection to the dispute between the parties, the reasonable expectations of the parties in relation to the place of litigation, and one must consider public considerations and what is the forum that has a real interest in discussing the claims. Here, the center of the employee's life was not in Israel, the salary was paid in US Dollars in Cuba, Israel and Spain and the employment was not reported to the tax authorities in Israel but in Spain and Cuba, the company has no operations in Israel, the agreements were signed in Cuba in connection with the plaintiff's activities in Cuba, and the conflict has no bearing on Israel. In addition, the fact that some of the company's shareholders are Israelis is not enough to create an affinity of the conflict to Israel and the employee was not even recruited because of his being Israeli but rather because of his experience in the field of agriculture and his command of the Spanish language. Thus, there is no room to discuss the claim in Israel.