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The Bank of Israel will pay new workers 30 percent less than current employees, according to an agreement reached between the central bank, its workers union and the Finance Ministry.

The average gross wage at the Bank of Israel is among the highest in the country at NIS 16,000 per month, which is on a par with Israel Electric Corporation and private bank employees. The new agreement cuts the average monthly wage to NIS 10,000-11,000, which is still high relative to civil service jobs.

With this, the new workers will be hired under so-called generation B conditions, according to which they'll be hired under collective bargaining agreement conditions and will be eligible to tenure as well as to come under the aegis of the union and the Histadrut labor federation.

In parallel, secret contacts are underway between the Finance Ministry and Bank of Israel executives to reach a compromise regarding the decision by treasury wage director Yuval Rachlevsky to cancel the efficiency bonus paid out to bank workers.

The decision became operative at the end of 2002, halting payment of this monthly bonus to all bank workers, which ranged from hundreds to thousands of shekels, depending on seniority.

Central bank workers had received the bonus since the late 1980s in exchange for agreeing to an expansive early retirement plan that cut the workforce by 25 percent.

In response to Rachlevsky's decision, bank management filed suit in Jerusalem Labor Court to issue a restraining order. The court has yet to decide but is expected to continue debating the issue in December.