As the Histadrut Labor Federation sticks to its demand for an immediate salary hike for civil servants, Histadrut chairman Ofer Eini and Finance Minister Ronnie Bar-On were scheduled to meet Monday in an attempt to reach a compromise and avoid a general strike. Eini's instructed union heads to prepare for a general strike after a meeting with Treasury Wage Director Eli Cohen last week failed to bring the two closer to an agreement. Eini rejected Cohen's proposal of a 0.2% increase to the workers' salaries for the years 2006 and 2007. If the talks between Eini and Bar-On fail, a strike could begin this week as early as Tuesday. In recent months of negotiations over a new salary agreement, the public sector workers' unions have been demanding a 10.4% wage increase for the 600,000 public sector employees retroactive from 2001, claiming that their wages have been eroded in real terms in recent years. Cohen, who previously maintained that the state would not grant any increase to its employees' wages, warned that a 10% public sector wage increase demanded by the Histadrut would cost the government NIS 8 billion in additional budget spending next year and was poised to lead to a wage increase at a cost of billions of shekels for the business sector as a whole. The Histadrut declared a labor dispute on June 19, before current Finance Minister Ronnie Bar-On was appointed. The declaration gave the country's largest labor union the right to call a strike if the dispute wasn't resolved within 14 days, a deadline that has already passed. The labor dispute covers over one million workers, including employees in government offices, the Bank of Israel, ports, trains, the postal service, some hospitals and government companies such as Israel Electric Corp. Employees of former state companies, including Bezeq Ltd., the country's largest telecommunications company, and El Al Israel Airlines Ltd., the country's biggest carrier, are also covered by the dispute. Shaul Zemach, director-general of the Tourism Ministry, has called upon Eini to leave all workers related to the tourism ministry out of the labor dispute, should no agreement be reached and a general public strike is declared. "The repercussions of a strike during the peak incoming tourism season to Israel would be significant to the sector, which is gradually recovering from the wounds of the Second Lebanon War," Zemach wrote in a letter to Eini.