The Great Exploitation: Palestinians Forced to Pay Huge Sums to Work in Israel

Under the current system, tens of thousands of Palestinian workers are each forced to pay 2,500 shekels ($780) a month for a work permit in Israel. The money is divvied up between a Palestinian middleman and an Israeli contractor

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Palestinian workers in Israel. The exploitation of them derives from a system set up by Israel, partly due to its security needs.
Palestinian workers in Israel. The exploitation of them derives from a system set up by Israel, partly due to its security needs.Credit: Ariel Schalit/אי־פי
Tali Heruti-Sover.
Tali Heruti-Sover
Tali Heruti-Sover.
Tali Heruti-Sover

During a two-hour visit to the Eyal Checkpoint near Tul Karm on a particularly cold January afternoon, hundreds of Palestinians, perhaps thousands, were on their way home. Aside from the few women, most of whom work in agriculture, they were men in clean clothes and tall, dirty boots, hinting that they work in construction. They had set out for Israel 14 hours earlier. Now, they will travel in a Palestinian taxi to their homes near Nablus, Jenin or Tul Karm, only to get up before dawn the next morning and start the exhausting trip all over again.

This is the reality for the 140,000 Palestinian workers now legally employed in Israel, of whom approximately 100,000 work within the Green Line, and the rest in settlements. They seem to have grown accustomed to the physical hardships of exiting and entering Israel – but not to the systematic exploitation that has been their daily routine for decades, in exchange for the right to work in Israel. The state is fully aware of the problem and has even tried to resolve it, but to date has failed to do so.

Under the current system, tens of thousands of Palestinian workers each pay 2,500 shekels a month in cash for a work permit in Israel that is not supposed to cost them a single cent. The money is divvied up between a Palestinian middleman and an Israeli contractor, either a Jew or an Arab. “As of now, I have paid out more than a quarter-million shekels this way,” says one longtime worker who was heading home through the Eyal crossing. “With that money, you could buy a house.”

Palestinian workers cross the Eyal Crossing, near Tulkarm.Credit: Ofer Vaknin

You’re in their hands

The exploitation of the Palestinian workers derives from a system set up by Israel, partly due to its security needs. The process of being employed in Israel proper begins with an Israeli contractor filing an application for a work permit from the Population and Immigration Authority. At present, there are no fewer than 4,200 Israeli contractors on the authority’s list of companies that have received work permits for Palestinian workers.

Sources in the Defense Ministry’s Coordinator of Government Activities in the Territories unit (COGAT) explain that there is no other way to do it. “We want the worker to have a father and mother in Israel,” they say, “so that only those who clearly have an employer who needs them can enter.”

Even if this approach makes sense, its execution is riddled with issues. “A building contractor can also be someone who is looking for 10 people for a certain project,” explains Assaf Adiv, executive director of Maan Workers Association, which represents Palestinian workers in Israel. When the work ends, that contractor is supposed to inform the Population and Immigration Authority. But over the years an unlawful practice has taken root: Instead of returning these permits, many contractors sell them by way of a Palestinian middleman to the workers, who in practice show up to work for employers that are by no means approved by the Authority. Since the worker cannot enter without a permit, they end up paying colossal sums of money to the middleman.”

That is just the start of a chain of events that has become well-oiled over the years. The Palestinian middleman keeps about 600 shekels (about $188) for himself, and the original contractor gets the remainder, in exchange for which he issues “his” employees a pay stub. These fake pay stubs do not include the actual number of days the employee worked or their real wages. The lower the amount paid by the contractor to the worker, the greater the amount that he pockets, although this will hurt him over time. If the worker dares to stop paying, the middleman will simply suspends their work permit.

“You pay every month, it doesn’t matter how much you worked,” say the workers at the border crossing. “During the holidays, you work less, but the middleman doesn’t care. You were injured on the job? It does make a difference. You’re in their hands.”

The system forces the workers to be dependent on middlemen, whose fee comes to about 20 percent of their gross wages, says Prof. Kenneth Mann. Mann is a founder of Public Defense, the public defender’s office in Israel’s Justice Ministry, and currently serves as executive director of the NGO LEAP (Legal Aid for Palestinians). “If these were Israeli employees, the authorities would not enable this unacceptable practice to take place. The authorities bear responsibility for the fact that the trade in these permits continues. They make it possible to exploit the Palestinian workers and to profit at their expense.”

Palestinian workers cross the Eyal Crossing, near Tulkarm.Credit: Ofer Vaknin

Indeed, the permit, which is supposed to be free of charge, deducts a significant share of the wages – which are not that high to begin with. “What’s left for me?” says one of the workers, doing the math: “I get about 400 shekels a day, usually less than that, which comes to 8,000 shekels a month. Minus 2,500 shekels for the permit, 1,500 for travel to and from Israel, another few hundred shekels for food at work. What’s left is maybe 3,500 shekels for a five-day work week. The work is hard – my workday begins at 2 A.M. and ends when I get back home at 5 or 6 P.M. I often wonder if it wouldn’t be worth it to stay in Palestine and make 150 shekels a day. At the end, I get practically the same thing.”

Incidentally, this “permit tax” is being paid by relatively young workers, since Israel has decided that due to security considerations, workers aged 55 and up are no longer required to receive a permit through an employer. However, the number of potential workers of this age doing construction and agricultural work is scant.

“The issue of age is completely arbitrary,” says Adiv. “It would have been enough if they had reduced the age to 40, or if they had decided that people who have been working for a long time no longer need a permit with an employer’s name, in order to put an end to the exploitation of anyone coming to work for him.”

Passing the buck

Assaf Adiv, executive director of Maan Workers Association, which represents Palestinian workers in Israel.Credit: Eyal Toueg

Even though the permit trade is illegal, it is very organized. “Once a month, on the same date, I make my way to an office in Jenin. There sits a lawyer, who takes the money in cash,” explains one of the workers. Receipts or paperwork are out of the question, but as the workers said, anyone who does not pay will have their permit to work in Israel suspended.

When this reporter asks the workers to name the contractors who “employ” them, the workers have to pull up the permits on their smartphones to find the contractor’s names. They don’t know who they are, even though they are the ones giving them their pay slips.

The stubs themselves infuriate the workers. As they tell it, they work a full month, but they nevertheless show us stubs according to which they worked between seven and 11 days. “Israel sees exactly when I enter and when I exit,” says one worker. “How can it be that I came in for 20 days, but my stub says that I worked for seven?”

An inquiry with a COGAT commander reveals that they do indeed collect the entry and exit information of each worker. They all have a magnetic card that they scan upon coming into and leaving Israeli territory. But this information, the commander says, is considered “security related,” and is therefore not cross-referenced with the Population and Immigration Authority, which is responsible for looking into the contractors and supervising their work.

“I do not know why the worker entered Israel, or if they even made it to work,” says another COGAT source. “That is something that the Population and Immigration Authority should be looking into.”

Meanwhile, the authority is not taking responsibility. “If there is concern of a permit-selling industry, approach the police,” it said in response.

The permit industry is not only an ethical problem in which underprivileged workers face exploitation, but an economic issue as well. A report by the Institute for National Security Studies, written by Haggay Etkes of the Bank of Israel Research Department and Adnan Wifag of New York University-Abu Dhabi in 2021, paints a picture of an industry of gargantuan proportions that has only continued to grow.

“In 2019, about 43,000 workers purchased work permits for about NIS 2,300 per month,” the report said. “The revenues in 2019 totaled NIS 1.2 billion, and the [UN] International Labour Organization estimated the profits of the permit trade net of employers’ expenses (social security, pension, etc.) at NIS 427 million. The illicit permit trade declined by about 40 percent with the lockdown imposed following the outbreak of COVID-19 in 2020 Q2, but recovered during the second half of 2020. Hence, in 2020 about 40,000 workers purchased work permits for NIS 2,440/month, and the revenues totaled NIS 1 billion.”

Palestinian workers at a checkpoint between Bethlehem and Jerusalem. A moral and ethical obligation.Credit: Emil Salman

As stated above, the trade in work permits is conducted openly. “Many permit brokers advertise on social networks with offers of various types of permits, and some have offices on main streets,” the report states. “In addition, about a fifth of the workers who purchase a permit sign an agreement with the broker or hand him a promissory note. The open sale of permits in the West Bank and use of formal legal documents in the sale indicate that both permit brokers and workers do not perceive these transactions as illegal, although it is not clear to us whether these transactions are technically prohibited by Palestinian law.”

Israel’s regulating agencies are familiar with this problematic phenomenon, and in December 2020 they announced a reform intended to bolster the negotiating power of the workers, at the expense of the employers and the permit brokers. The reform did away with each registered employer’s specific quota. In its place, it handed control over the quota to longtime workers who hold permits, and authorized them to approach any registered employer and conduct negotiations on new terms of employment. These negotiations can be held by means of an app developed for this specific purpose, and 10,000 workers have already signed up. Contractors seeking workers can now approach them directly, without the middleman.

Good intentions notwithstanding, the workers – at least those who were at the Eyal crossing that day – are still paying. They had not heard of the reform and knew nothing about the change. “The reform has not managed to put an end to this unacceptable system,” says Mann. Similarly, the INSS report says: “Neither the share of workers purchasing permits from permit holders nor permit prices declined during the first half of 2021.” COGAT sources confirm that the problem still exists. According to one high-ranking officer, all of the relevant parties recently convened for a discussion in an attempt to resolve the problem.

The INSS suggests solutions such as improving and expanding the use of the new app, while employing effective punitive measures against the Israeli contractors and the Palestinian middlemen, with the Palestinian Authority’s help. Conversely, the Maan association suggests taking it a step further and altogether neutralizing the control wielded by the employers, through issuing a sort of visa to Palestinians to work in Israel on the basis of preliminary security and criminal checks, without involving particular employers.

The system forces the workers to be dependent on middlemen, whose fee comes to about 20 percent of their gross wages, says Prof. Kenneth Mann.Credit: Amos Ben Gershom / GPO

Adiv says that by implementing the 2020 reform, the authorities admitted that they were aware that “something is rotten in the state of permits.” Nevertheless, he adds, they are not taking any effective action “to investigate and punish those who have committed the crimes, who are making hundreds of millions of shekels a year on the black market. Based on our proposal, workers will not be chained to employers, and will therefore not require middlemen. Thus, in a single thrust, the permit trade will be eliminated.”

COGAT’s response: “COGAT, in collaboration with the relevant government ministries and enforcement authorities, is investing great efforts in combine forces to eradicate the phenomenon of the middlemen and the trade in employment permits for Palestinian workers. This is prompted by a moral and ethical obligation, with the objective of preventing harm to the rights of the Palestinian workers employed in Israel.” As such, it said, the organizations involved are working toward implementing the reform “with the understanding that it is a significant, positive step for the field of Palestinian employment in Israel. It is expected to improve the employment process for Palestinian workers while bolstering the direct contractual relationship between employee and employer.

“At the same time, government ministries are advancing additional steps. Upon their implementation, they are expected to make it even harder for the middlemen to continue unlawfully trading in employment permits for Palestinian workers.” These initiatives, it said, include working towards paying workers via the internet, “enlarging the permit quota and looking into the possibility – in conjunction with the Population and Immigration Authority – of creating employment quotas for the Israeli employers.”

The Population and Immigration Authority said: “The authority is responsible for granting permits to employers who are registered contractors, in accordance with information received from the Registrar of Contractors. The authority’s director-general took part in a roundtable discussion that examined the matter together with all of its partners – the Civil Administration, the Construction and Housing Ministry and the Justice Ministry – and at the present time, solutions are being advanced that will bring about changes in this area.”

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