Local Authorities the Biggest Users of Contract Workers

About half of the local government workforce comes from manpower agencies or work for non-profit agencies or independent corporations that have been set up by local authorities.

Monday's general strike paralyzed much of the country for hours Monday morning, but the real target of the labor action might have been local governments, which make the greatest use of outsourced workers.

About half of the 100,000-strong local government workforce comes from manpower agencies or work for non-profit agencies or independent corporations that have been set up by local authorities, according to Dan Ben-Haim of the Union of Local Authorities.

A Tel Aviv train station stands empty during train strike November 7, 2011.
Nir Kafri

On Monday, much of the nation's work force was on strike for several hours in a labor action led by the Histradrut labor federation over concerns about the status of the large number of workers who are employed through manpower agencies rather than the entities where they actually perform their work. The strike lasted only a few hours, after the National Labor Court ordered that it was to end by 10 A.M. For part of the morning, the strike, which was spearheaded by Histadrut chairman Ofer Eini, affected a number of areas, including government ministries, local authorities, departing flights at Ben-Gurion International Airport and rail service around the country as well as banking and the Tel Aviv Stock Exchange.

Ben-Haim, who is in charge of labor relations for the ULA, said the outsourcing of workers, who are generally paid half or even a third of what regular employees get, began at the local government level 20 years ago. At that time, municipal governments sought administrative flexibility when it came to recruiting and laying off workers or transferring them from one position to another, without the involvement of workers' committees or the Histadrut. Over the past decade, he said, the phenomenon has become more pronounced following the financial crisis many local governments have faced and due to the recovery plans that they were forced to implement by the national government.

"The need to save on wage costs and reduce permanent staffing levels required the authorities to enlist contract employment agencies and companies providing services," Ben-Haim said. "In many cases, collective wage agreements were signed between the local government management and the workers' committees and the Histadrut, which on one hand, provided for wage increases for the permanent workers [employed directly by the local governments] and on the other hand, the workers' committees allowed a small provision to be added to their agreement permitting [local governments] to diversify types of employment and the recruitment of contract workers."

He cited as an example an agreement reached between the Jerusalem Municipality and the municipal workers' committee permitting the outsourcing of maintenance crews in the Old City.

From a nationwide perspective, a senior official at one municipality said, 20,000 of the 100,000 people working for local authorities are teachers. If they are excluded from the calculations, over 62% of the workforce of the local authorities consists of contract workers not directly employed by them.

The most common functions of the outsourced labor involve maintenance work such as cleaning, garbage collection, gardening and tree-trimming and sidewalk and road repair. The number of outsourced office staff, on the other hand, is tiny, the official added.

"It's not worth it for the local authorities to deal with cleaning and street-sweeping itself," the official said. "A cleaning contractor already provides the equipment and the [local] authority saves on buying the expensive equipment and storing it."

He said the Histadrut has just recently made an issue of the outsourcing of workers, demanding that the workers be put on municipal payrolls, because "they were starting to lose soldiers. They understood that if they waited longer, they would be left without soldiers to carry out the fight over wages and strikes."

In the private sector, the three largest banks were asked for information on outsourced staff who work for them. Only Israel Discount Bank gave precise figures. It has 500 contract workers in addition to a staff of 6,000 employed by the bank directly.

Bank Leumi said it has several hundred contract workers, who work as security guards, janitorial staff and to supplement employees engaged in banking functions, out of a workforce of about 10,000. Bank Hapoalim did not respond.