The ministries of finance and of industry and trade are formulating a draft law aimed at ending the exploitation of public-sector employees who are hired by contractors. Many of these workers are paid less than minimum wage and do not receive benefits stipulated by law.

The public sector, including municipalities, universities and government ministries, is the largest employer of workers via contractors, and as a result has the largest number of workers whose labor rights are being violated. The treasury has been criticized for allowing the state to permit this violation of its own laws.

In light of this criticism, the Finance Ministry has begun framing a bill that would bar labor contractors from winning any public sector tender that did not guarantee a minimum wage and basic benefits to the employees working under the tender. The law would also impose a fine on a contractor who breaks the law.

Labor contractors slash their bids to win tenders, which hobbles their ability to pay a fair wage to their workers. The treasury is considering including a provision within the draft bill that would compel bidding contractors to prove their bid allows them to pay their employees at least minimum wage.

Any bids that do not meet minimum wage criteria would be disqualified. In addition, contractors would be required to submit wage reports and face monitoring of employee terms and conditions.

The bill is expected to take a few months to write, after which it will be submitted to the new government.

The treasury and the Ministry of Industry and Trade disagree over who should be responsible for violations of contract workers' rights. The Finance Ministry believes the contractor should continue to bear the responsibility, while the Industry and Trade Ministry wants the body where the workers are employed, such as a municipality or ministry, to take responsibility.

Clalit Health Services has already taken the treasury's position to heart, firing the cleaning services contractor that won a tender two months ago to clean the HMO's clinics. Clalit informed the Be'er Sheva District Labor Court of its decision to fire Etgarim after the Histadrut labor federation filed suit against the HMO claiming the amount paid to the contractor was insufficient to pay its workers the minimum of NIS 29 per hour guaranteed by law.