What is the Central Compensation Fund

A central compensation fund is a fund designated to pay severance compensation to workers upon termination of the employee-employer relationship.  In the central compensation fund the member is the employer.
A member in a central compensation fund is called an "employer-member".   Every employer-member in the central compensation fund has a separate account which records his deposits into the account, withdrawals from it, the yield on his investment in compensation fund and the management fees charged to his account. 
The money in the central compensation fund is invested in accordance with the legislative arrangement and the fund's regulations.  The yield is divided among the fund members pro rata to their share in the fund's assets.
Investments in a central compensation fund are recognized for the employer as an expense for tax purposes.
Following Amendment 3, it is not possible to open new accounts for a central compensation fund.
An employer who deposited in December 2007 money in a central compensation fund for his employees has the right to continue depositing in that fund for those employees until December 2010.  As of January 2011 it is no longer possible to make deposits in a central compensation fund.

Tax Benefits
Deposits made in a central compensation fund are considered a recognized expense for the employer for tax purposes on the date of the deposit according to the regulations, although these funds have not yet actually been paid to the employees as compensation.

List of Compensation Funds