Histadrut Refunds Millions to Big Unions

The Histadrut labor federation returns a hefty chunk of the union membership dues paid by some of the biggest and most powerful unions, Haaretz has learned.

It is estimated that tens of millions of shekels have been refunded by the uber-union.

The Histadrut had traditionally charged members 0.9 percent of their wages as dues. But it raised this to 0.95 percent in 2005. People who don't belong to the union, but receive service by virtue of collective employment agreements, are charged organizational handling dues amounting to 0.8 percent of their salary.

The labor federation has between 600,000 and 650,000 members. Total revenues from the federation's members and nonmembers who receive service amount to about NIS 300 million a year.

Most members and labor committees transfer their dues to the Histadrut on a regular basis. But the biggest and most powerful unions, mostly representing bank workers, are exempt from the full cost, it transpires: They get about half of their money back.

"It is an improper procedure that explains why the Histadrut under Amir Peretz maintained such tight ties with the powerful unions over years, sometimes at the expense of its duty to weak groups of workers who really needed its protection," charged Ilan Vikelman, chairman of the Oz faction inside the Histadrut. The Oz faction was founded by MK Haim Katz (Likud), a Peretz rival. It is the only faction in opposition inside the labor federation.

"Beyond the fact that it is unjustified, because it discriminates among the worker groups that the Histadrut represents, refunding money to the big unions contravenes proper administration and norms of transparency at a public organization," Vikelman said.

He said the Histadrut's budget for 2005 and budget proposal for 2006 do not mention these refunds.

"It is highly probable that budget sections on the Histadrut's revenues delete these refunds in advance," Vikelman surmised. "It amounts to distribution of money without procedure or clear and approved criteria, rewarding only crony unions."

The Oz faction plans to raise its suspicions that the Histadrut management has been breaking the law at the next gathering; a special meeting has been called for next Tuesday, to confirm the appointment of Ofer Eini as chairman, replacing Peretz, who has taken the chair of the Labor Party.

"Refunding money to the big unions does not attest to preferential treatment of some unions at the expense of others, or to unprofessional considerations," the Histadrut spokesman responded last night. "The Histadrut refunds some of the membership dues to these unions because, thanks to their financial robustness, these unions require less of the Histadrut's services than unions representing weak workers. The strong unions maintain batteries of lawyers and accountants of their own, and take little advantage of our expert team."

Another high official at the labor federation said the refunds are carried out openly and there should be no suspicions of wrongdoing.