Hebron Investment


Production Factors and related costs

1 Labor

1.1 Labor Law

The labor issues are regulated in the Palestinian Authority according to the Labor Law Number 4, 2000 harmonizing the separate laws between West Bank and Gaza.



Minimum Wage

NIS1450 equivalent to around $400 based on exchange rate of the US Dollar. 

Work Day / Week

Maximum 45 hrs/week; no daily limit

Overtime Pay

150% of daily pay for overtime

Annual Leave

  • Minimum of 14 days for the first 5 years of employment;
  • Minimum of 21 days thereafter.

Severance Pay

1 month of salary accrued over the year, with no accumulation limit.

Worker’s Accident


All employers are required to carry insurance for employees.

Sick Leave

  • Days 1-14=100% of salary;
  • Days 15 -28=50% of salary.

Maternity Leave

100% of pay for a total leave period of 10 weeks, providing that 6 weeks are taken after the delivery day.


 Labor Quality and Availability

Skilled human resources, males and females with international exposure is one of the main competitive advantages of Palestine.  This applies to different sectors and diversified portfolio of skills including but not limited, project management, financial management, information technology, business skills and other related skills.

  • Gender Sensitivity

Labor law is gender sensitive and discrimination between men and women at work, including employment procedures, is prohibited by law

  • Labor Disputes

Labor disputes are solved by negotiation within each establishment. If a dispute cannot be resolved within the establishment, either one or both parties have the right to resort to the reconciliation office at the Ministry of Labor. If the reconciliation officer fails to resolve the conflict within 10 days, the minister is obliged to refer this dispute to a reconciliation committee consisting of a ministry staff member who heads the committee and an equal number of members selected by both the employer and the employees. If this committee fails to resolve the dispute within two weeks, the parties are free to resort to court.

  • Working Hours

A working week consists of 45 working hours; however, workers are entitled to one-hour rest on a daily basis. It is permissible for both parties to reach an agreement on overtime that does not exceed 12 hours per week. The worker also has the right to be paid weekly time off no less than 24 consecutive hours.

  • Minimum Wage

The minimum wage specified after long negotiations between the private sector representative organizations and labor union representatives was set at NIS 1450 which is equivalent to around $400 based on the exchange rate of the US Dollars.

  • Child Labor Force

It is forbidden to employ children under the age of 15. Juveniles aged 15 – 18 who are eligible to work, need to be subjected to a medical examination prior to employment, to be repeated every 6 months. Those under the age of 18 cannot be employed in dangerous industries or industries that damage health, nor are they allowed to work at night.The daily working hours must be reduced for juveniles by no less than one hour daily. The annual holiday for juveniles is 21 days and it cannot be postponed to the following year.

  • Cost of Labor

The cost of labor in Palestine though is proximity varies based on the area and location. The table below shows the labor cost as indicative measure.


West bank




Cost of Labor:


Per Month



Per Day


Per Month


Per Day


Per Month

Per Day


$750 -1,200

$31 - 50

$600 - 750

$25 - 31



$30- 45


$550 - 700

$25 - 35

$450 - 650

$14 - 25



$20 - 32


$450 - 550

$20 - 30

$400 - 500

$11 – 20



$20 - 28


Energy and related costs

2.1 Cost of electricity

The Palestinian Energy Authority (PEA) has published a harmonized electricity tariff system all over Palestine. The prices are updated on regular basis by the PEA.

  • Industrial Electricity costs an average of NIS 0.5366 per KW.Hr + VAT
  • Commercial Electricity costs an average of NIS 0.667 per KW.Hr + VAT
  • Agriculture Electricity costs an average of NIS 0.497 per KW.Hr + VAT
  • Attached file

2.2 Cost of Fuel

2.2.1 Natural gas

Industrial Natural Gas 4.67 NIS per Kg, the equivalent of US$

1.28, thereby 1 m3 of gas = US$ 3.2

2.2.2 Diesel Fuel

Diesel Fuel is 5.86 NIS per liter, the equivalent of US$ 1.6

2.2.3 Gasoline

Gasoline is 6.61 NIS / liter, the equivalent of US$ 1.81

3. Cost of industrial water  

Industrial Water is 5.0 NIS per m3, the equivalent of US$1.37

4. Construction cost

The Construction cost of a basic industrial building ranges from $400 / SqM for hangers to around and $1200 / SqM for stone building and reinforced concrete. The price depends on the geographical area, geological specification of the site, quality of the finish inside the facility based on the utilization purposes of the facility. 

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The author’s views expressed in this publication do not necessarily reflect the views of the United states Agency for International Development or the United States Government.