Agreement reached to raise minimum wage to NIS 4,300

Histadrut, Manufacturers Association leaders agree to two-phase plan to raise minimum monthly wage; legislation yet to pass through Knesset.

Money 311 (photo credit: Bloomberg)
Money 311
(photo credit: Bloomberg)
An agreement was reached Sunday on raising national minimum wage to NIS 4,300 a month, after four years of legislative stagnation. Army Radio reported that Shraga Brosh, chairman of the Manufacturers Association, and Ofer Eini, chair of the Histadrut national labor union have made an agreement which stipulates that minimum wage increase will occur in two phases, the first of which is scheduled to take place in July 2011, with the second phase concluding in October.
Though Brosh had most recently opposed the minimum wage hike, he explained to Army Radio why he had changed his mind during the recent talks. "We always understood the hardships of those earning NIS 3,850 a month, but we are committed to employers' survival during this difficult period. The increase is a result of lengthy negotiations—the Histadrut wanted more but we reached a common ground."
Knesset rejects minimum wage hike

The agreement was made without the involvement of Finance Minister Yuval Steinitz who had rejected Labor MK Amir Peretz's previous initiative to raise minimum wage. During Eini's interview on Army Radio, the chairman of the Histadrut expressed high hopes that Steinitz would join the initiative and help anchor wage hike from agreement to legislation in the Knesset. "We came to an agreement during talks with manufacturers themselves, and as such there is no reason that the minister would oppose [the legislation]."
Currently, because the increase in minimum wage is an agreement and has not passed legislation in the Knesset, businesses and manufacturers are not required by law to implement the wage hike to NIS 4,300. Industry, Trade, and Labor Minister Binyamin Ben-Eliezer, however, has already announced that legislation will soon be pushed in the Knesset.