Under Threat of Strike, Israel's Treasury Begins Talks on Minimum Wage

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Histadrut chairman Avi Nissenkorn at the meeting earlier this month in which the labor federation voted to strike over the minimum wage. Credit: Tomer Appelbaum

Finance Minister Yair Lapid will start negotiations with the Histdrut labor federation on Monday in a bid to avert a national strike over demands to sharply raise the minimum wage, the ministry said.

Israel’s minimum wage stands at 4,300 shekels ($1,116) a month and the Histadrut — the umbrella organization for hundreds of thousands of public service workers — is seeking a hike to 5,300 shekels.

Lapid invited Histadrut Chairman Avi Nissenkorn and Zvika Oren, head of Israel’s Manufacturers’ Association, for talks on Monday aimed at preventing a strike the Histadrut has set for December 4, which would likely shut the airport, trains, seaports and government services.

National strikes cost Israel’s economy an estimated 2 billion shekels a day.

Lapid, in a meeting with Nissenkorn on Friday, said he supported a rise in the minimum wage and helping those at the bottom of the wage scale.

He has said in the past that he would support a rise to 4,500 shekels a month. Economy Minister Naftali Bennett also has expressed support for a higher minimum wage.

According to the Organization for Economic Co-Operation and Development, Israel’s real minimum wage was in the middle of the pack — 12th out of 25 countries in 2013. In dollar terms, it was $14,291 a year in 2013, just behind the United States’ $15,080.

This placed Israel well behind Australia, with the highest annual minimum wage at $30,389, Luxembourg, the Netherlands, Belgium, Ireland, New Zealand, France, Canada, Britain and Japan.

But it was well above Mexico, the lowest at $1,285, Chile, the Czech Republic, Estonia, Hungary, the Slovak Republic, Poland, Turkey, Portugal, Greece, Spain, Korea and Slovenia.

Nissenkorn called Israel’s minimum wage a “starvation wage,” describing it as the country’s main economic problem.

“I do not see government ministers or Knesset members capable of surviving a month on 4,300 shekels,” he said, adding that he would not accept another monthly rise of 200 shekels. The minimum wage was last raised by 200 shekels a month in October 2012.

Oren said he favored a hike in the minimum wage as part of a comprehensive agreement that reduces the employers’ tax and allows for more flexible working hours. But he said he opposed a strike “because it does not allow for real negotiations.”

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