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The terms of the 2009-2010 public sector wage agreement have been agreed on, says the Finance Ministry, and the deal could be signed later this week. The agreement gives employees in the public sector a lump sum equal to 36% of their salary and benefits such as overtime, incentive bonuses and the like. The allocation is in lieu of the 3% wage hike that was negotiated in 2008 and was to have gone in effect in January. It will be based on each worker's average monthly salary for the twelve months between May 2008 and May 2009.

The Histadrut labor federation has agreed on behalf of workers to forgo 50% of their rest and recovery benedits and will pay the remainder together with the lump sum to spare employees the direct effect of a lower paycheck. Rest and recovery (dmei havra'ah) is a historical benefit originally meant to provide laborers with vacations. The benefit will be canceled completely in 2010.

Under the 2008 agreement, workers were to receive a 5% wage hike in three increments, starting in January 2008 with a 1.5% increase, which was to have increased to 3% from January 2009, and to 5% in January 2010.

In 2008 workers received the wage hike in the form of a lump sum amounting to 16.5% of their wages. The third stage of the wage hike, scheduled for January 2010, is to be paid out as scheduled.