The General Federation of Labor Histadrut and the Ministry of Finance have reached a new wage agreement in the public sector. Later in the day, Finance Minister Bezalel Smotrich and Histadrut Speaker Arnon Bar-David will hold a press conference to announce details of the deal, including public sector wage hikes and tax rights on pensions.
The salary agreement includes an agreement with childminders. Bar-David had demanded that starting salaries be increased by 20%, from NIS 5,900 per month to NIS 7,000-7,500, with further increases to NIS 10,000 depending on professional progress.
Another issue that had been in dispute was the expected reduction in tax benefits in pensions, which now appears to be canceled as part of the agreements between the Treasury and the Histadrut. This week, Bar-David announced he would oppose the Treasury’s plan to hurt public retirement benefits, which was approved by the government, as part of the state budget.
As “Globes” reports, the country’s historic promise to raise the tax exemption cap for pension benefit recipients in 2025 has been rescinded by the government. This would have meant a loss of hundreds of shekels every month for retirees. On behalf of Bar-David, it was announced last Tuesday that “it’s not going to happen.”
Public sector wages have been rising slightly in recent years, despite the wage settlement freeze imposed at the start of the Covid crisis in 2020, which is still in effect today. For example, in 2021, the average salary for all government office employees was NIS 17,368 per month for a full-time position, an increase of about 1.3% over the 2020 salary and an increase 1.6% compared to 2019.
Published by Globes, Israel business news – en.globes.co.il – March 2, 2023.
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