Israeli Court Cuts Strike Short, Orders New Negotiations on Contract Work

Israel’s National Labor Court ordered that a general strike that began at 6 a.m. today end after four hours, cutting short a labor action that shut trains, banks and the Tel Aviv Stock Exchange.

The court also said the Histadrut labor federation must return to negotiations over the issue of contract workers and give a progress report on Nov. 10, the court said in an e-mailed statement

The strike is the first national labor action since social activists staged a series of protests beginning this summer directed against high prices and income inequalities in society. One in five Israelis lives in poverty, according to the Organization for Economic Cooperation and Development, where the average rate is 11.1 percent. The cost of housing has increased about 40 percent in the last three years, according to the Bank of Israel.

The labor federation estimates that about 250,000 Israelis are employed through contractors and is calling on the government to take stronger action to have them hired directly so they receive higher salaries and benefits. Histadrut Chairman Ofer Eini charged last week that Finance Ministry officials were so resistant to that they viewed it as akin “to putting pigs in a synagogue.”

“Until now Eini has been relatively reluctant to call strikes,” Ben-Zion Zilberfarb, professor of economics at Bar Ilan University outside Tel Aviv, said in a phone interview. “So it may be that after the social protests this summer he felt obligated to take action that would put the Histadrut ahead of the social-welfare issue.”

Stock Trading

The Tel Aviv Stock Exchange said bond and derivative trading will begin at 10:45 a.m. and stock trading will start at 11 a.m. and markets will close at 5 p.m. Delays were reported in public transportation and flights at Ben-Gurion International Airport, where the strike began at 8 a.m., Israel Radio reported.

Israel’s benchmark government bond rose yesterday, pushing the yield to the lowest level in a month as the strike threat boosted demand for safer assets.

Prime Minister Benjamin Netanyahu told the weekly cabinet meeting in Jerusalem yesterday he believes a “fair and responsible” solution can still be found to the contract workers issue. “We must bring a solution that will not harm the Israeli economy at a time that we are witnessing the upheaval of world markets,” Netanyahu said in a statement.

Finance Minister Yuval Steinitz said that while the government “is willing to do much to improve wages of contract workers and to maintain their conditions,” the use of contract workers, especially in cleaning jobs, is part of “the modern world.”

To contact the reporter on this story: Calev Ben-David in Jerusalem at cbendavid@bloomberg.net Jonathan Ferziger in Tel Aviv at jferziger@bloomberg.net

To contact the editor responsible for this story: Louis Meixler at lmeixler@bloomberg.net

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