Suddenly, the Treasury Wakes Up

Legislation which would obligate security companies to improve the treatment of their workers has been tied up in bureaucracy for over a year.

Over a year ago the Industry, Trade and Employment Ministry drafted a proposal that, if implemented, would have obligated security companies applying for government tenders to stipulate the wages and benefits they planned to pay workers, and to present an accountant's statement every 6 months proving that such wages were indeed being paid. That proposal, however, never reached the Knesset plenum because the Finance Ministry opposed it, just as it has opposed every proposal making the government responsible for the rights of the tens of thousands of contracted workers it employs.

Claims that the government was lending a hand to violation of the law, turning a blind eye to the crushing of contracted workers' rights, or favoring companies submitting low tender bids ?(making it impossible for the winner to pay workers legal wages?) were to no avail. The thousands of suits filed by workers to the Labor Courts against contractors also made no difference, nor did protests by such social organizations as Kav La'oved ?(Worker's Hotline?) and the Association for Civil Rights in Israel.

The following also did not make a difference: a report by students at Hebrew University, documenting the wholesale violation of the rights of security and cleaning staff at government offices; the discovery by high school students that their school guards were not paid properly; the publication of figures that some 40 percent of poor people work; and the confession by security contractors themselves that they underpaid workers by an average of NIS 5,000 - NIS 6,000 a year.

The treasury heard and saw nothing. Clerks at the accountant general's office issued only a self-righteous statement that every service contractor who signed a contract with the government obligated himself to pay his workers in keeping with the labor laws, the collective agreements and their expansion orders.

As long as the treasury thought that the contractors were only deceiving the workers, silence reigned. Only when the government realized that it, too, was being hoodwinked, did the treasury take notice. Attorney Eran Golan, of Kav La'oved, provided this insight in a suit filed on behalf of a former security guard at the Religion Ministry, against the Modi'in Ezrahi security company. The contract signed between the government and Modi'in Ezrahi was part of the suit. The contract revealed that the company had received NIS 40 per hour for every guard, and had commited to pay him about NIS 28 per hour, including all his rights. In practice, the company pays NIS 24 at best.

Deputy Accountant General Eitan Kashmon examined Golan's claims and found them to be true.

This prompted Accountant General Yaron Zelekha to declare a policy change. From now on, his office's audit department will oversee the preservation of the rights of contracted workers employed by the state. This oversight will include the examination of the reports sent by the contractors to the Income Tax Authority, National Insurance Institute, pension funds and provident funds ? to ensure that employers are indeed paying all the deductions required by law.

The contractors will also be required to submit pay slips for examination and the guards will be queried about their employment terms via anonymous questionnaires. Every government office will appoint a person to be in charge of handling complaints by contracted workers. The accountant general has also promised to punish recalcitrant contractors by redeeming guarantees and canceling contracts.

One of the tests of the treasury's seriousness will be its willingness to act as a regulator, rather than as an employer who focuses on lowering costs. This was why security services at government offices were privatized in the first place. The government did save money, but at the security guards' expense.

When the security companies realized their ruse was uncovered, they became "pious." Now they want to set things right throughout the private security service industry, to be honest ? but lament that they have no choice but to shaft the workers because the government does not want to pay the price to guarantee them their full rights. One security company even leaked tenders to the press, supporting this claim, while the company itself has been sued by 700 workers over the past two years.

Even the Histadrut labor federation joined the party. At the request of the security company, the Histadrut notified the Justice Ministry that the company was a signatory to a collective agreement obliging it to protect its workers' rights. The Justice Ministry committee that grants licenses to the security companies viewed this document as a certificate of integrity for the renewal of the company's license for 2006, despite the fact that Kav La'oved discovered that in 2005 alone over 350 suits were filed against the company. The company now wants to sign a new collective agreement with the Histadrut, which will probably consent ? so as not to lose out on membership dues from 15,000 workers.

The security industry is now in turmoil. The accountant general will soon be issuing a tender to determine which companies will be eligible to compete for government tenders for security services. The contractors now realize that the rules of the game have changed. But just by how much depends on the determination of the accountant general.