The decision to transfer the responsibility for calculating the wages and benefits of Palestinian workers from the government to the employers is poorly thought out, the Histadrut said earlier this month. In a letter sent by Histadrut Vice President of Economics and Policy Adam Blumenberg, to Moshe Nakash, head of the foreign workers department at the Population and Immigration Authority, Blumenberg argued that transferring the responsibility would harm Palestinian workers' ability to fully exercise their rights.
Before October 7, Israel employed 150,000 Palestinian workers from the West Bank and 18,500 from the Gaza Strip, most of whom worked in construction and agriculture. Those workers rely on permits to enter into Israel, which were initially frozen after the war broke out. Employers of Palestinian workers were required to submit an employment log to the payments division at the Population and Immigration Authority, which included all components of the workers’ wages. The authority’s employers service division then calculated the net salary that the employer had to pay the worker each month, as well as the deductions and withholdings collected by the state—a process known as wage calculation.
Recently, the Population Authority announced that starting from January, employers will be required to perform the wage calculation themselves. They will need to calculate the workers’ wage components and issue pay slips directly. Employers will only need to report certain data to the authority, from which the state will create an online register detailing payments for pensions, the “equalization levy” paid for Palestinian workers instead of national insurance payment, payment for Palestinian Authority health care, and income tax.
The decision is based on a government resolution from March 2022 to implement recommendations by an interministerial team, but the Histadrut argues that the core recommendations would result in shifting away from the government the responsibility for protecting the rights of Palestinian workers employed in Israel. Blumenberg emphasized in his letter that the Histadrut had already submitted its objections to the team’s conclusions when they were published in 2019, concerned they would cause a deterioration in the conditions of Palestinian workers.
According to Blumenberg, both the initial report and the recent government decision are based on a flawed assumption that transferring responsibility to employers will improve the ability to exercise and enforce workers’ rights.
“This assumption ignores the structural weaknesses of Palestinian workers in the Israeli labor market,” Blumenberg noted. He outlined these workers’ extreme dependency on their employers, and the difficulty in exercising their rights because of restriction of movement, language barriers, and cultural differences, as well as their employment in sectors characterized by enforcement issues such as construction and agriculture.
Unlike Israeli and foreign workers, Palestinian workers are constituents of the Palestinian Authority and recipients of its healthcare and social security system, but employed in Israel which has a separate and distinct system.
“The coordination between these two separate systems is only partial,” Blumenberg wrote. “In the absence of central arrangements for coordinating information and maintaining continuity of rights, the spread across two separate systems increases the risk of falling between the cracks and exacerbates the difficulty in exercising rights.”
Blumenberg argued that the current situation, where the payments division at the Population and Immigration Authority is responsible for centralized wage calculation, helps centralize both the payments and the workers’ data in one accessible place.
“Given the complexity of coordinating between the two social insurance systems, it is likely that the current arrangement is preferable compared to a scenario where responsibility for deposits and deductions is dispersed among employers,” he wrote.
As he sees it, transferring responsibility for payments to Palestinian workers from the state to employers must be accompanied by enhanced enforcement and oversight of Palestinian workers’ rights, both through the enforcement unit in the Ministry of Labor and the payments division.
He added that “there is currently no stable infrastructure within the Population Authority that can be relied upon” to replace the checks and balances which the standing Israeli system currently provides. Beyond that, announcing the end of the current system with only five months’ notice does not provide employers with sufficient time to adjust their payroll and reporting systems to accommodate the new responsibilities.
“Given this, and especially in the initial months, numerous errors and mistakes in workers’ wages are expected. … The state should not shirk its responsibility for protecting and enforcing the rights of Palestinian workers employed legally in Israel,” he concluded.
If the decision to end state wage calculation is implemented, Blumenberg recommended a series of supplementary measures to ensure effective enforcement:
1. Publicizing Contact Points for Rights Violations: The Payments Division should include contact details for addressing worker complaints in its notices, including the Histadrut’s service center, as it is the largest workers’ organization, in Israel and the unions in the construction and agriculture sectors, where most Palestinian workers are employed.
- 2. Establishment of an Accessible Response System: A telephone hotline in Arabic should be set up where workers can obtain information about their rights and report violations.
- 3. Strengthening Government Enforcement Mechanisms: The state should strengthen both the enforcement mechanisms within the Population Authority and the Ministry of Labor to ensure there is sufficient staff for targeted enforcement operations to support the implementation and integration of the responsibility for wage calculation for Palestinian workers in Israel.
- This article was translated from Hebrew by Hannah Blount.
