MKs Face Opposition in Bid to Up Minimum Wage

Proposal, spearheaded by Amir Peretz, would need approval of finance, trade ministries.

The Ministerial Committee for Legislation yesterday voted to support a bill proposed by MK Amir Peretz (Labor ) to gradually raise minimum wage from NIS 3,850 to NIS 4,600 per month.

The Knesset is expected to pass the preliminary reading of the bill on Wednesday. However, the committee conditioned its approval on Peretz coordinating the continued legislation process with the Finance Ministry and the Industry, Trade and Labor Ministry. That condition may delay legislation, given opposition in the ministries to the move.

"There is no doubt that this move raises hope among the families of a million workers in Israel who are below the poverty line," Peretz said yesterday. "This is an important social and economic decision and legislation must be concluded soon."

Manufacturers Association President Shraga Brosh warned that "the decision to raise minimum wage will lead the Israeli economy to dangerous places. People who promote the bill will cause additional factories to weigh their continued existence and expansion in Israel."

According to Brosh, an across-the-board minimum wage raise does not help the poorer levels of society. "We are in competition with the world and therefore a decision of this type strikes a serious blow at the competitiveness of the Israeli economy," he said. Brosh said a better tool to help people who earn less than NIS 5,000 a month would be negative income tax, by which the government would supplement such incomes.

The Histadrut labor federation yesterday said it welcomed the move, and that "it can be accomplished with the agreement of all parts of the economy, as is done with the collective wage agreements the Histadrut has concluded in various fields."

According to Histadrut chairman Ofer Eini, it is better to institute the raise by agreement between the government, the Histadrut and private employers.

Shay Cohen, a leader of the Koah La Ovdim labor union, said, "In the shameful reality of the labor market in Israel, there is no choice but to set a higher minimum wage if we want to improve the situation of workers, who bring home less than the minimum wage."