Tags: jerusalem | strike | labor | israel | business

Strikes Hurting Israel's Global Business Potential

Image: Strikes Hurting Israel's Global Business Potential

Israeli foreign ministry employees speak on the phone outside the ministry in Jerusalem on March 24, 2014, as they intensified a long-running dispute over pay and conditions declaring a full-scale strike at home and at diplomatic missions around the world. (Menahem Kahana/AFP/Getty Images)

By Gidon Ben-Zvi
Wednesday, 01 Feb 2017 11:07 AM Current | Bio | Archive

It's been one hell of a week to be a father of young children in Jerusalem. Public day care centers across Israel's capital have been shut for three days and counting, amid a budgetary standoff between the city and Finance Ministry over unpaid wages.

Earlier in the month, the Histadrut labor federation declared a one-day bus strike in Jerusalem, over a wage dispute between workers and management of the Egged bus company.

And let's not forget about the growing, stinking piles of trash dotting the Jerusalem landscape. You guessed it: a strike has resulted in garbage across the city being left uncollected, blocking roads and disrupting the local light rail service.

This latest spasm of public sector labor unrest has unleashed a flurry of WhatsApp messages from confused parents who are having trouble keeping up with the fast- breaking developments. Strike's on. Strike's off. Strike's sort of on, sort of off: no daycare, but kindergarten afternoon programs are scheduled to remain open…

Needless to say, the wave of strikes battering the Holy City raises questions as to the right of groups to strike.

While strikes and slowdowns have declined dramatically in other Western countries over the last three decades, they have only increased – sharply – in Israel. And being arguably the most strike-addled economy in the industrialized world is making it more difficult for Israel to compete in an increasingly globalized marketplace.

Israel's severe labor problems are the result of the country's highly centralized economy. As noted by Evelyn Gordon, Contributing Editor of Azure, the incentive to strike is much greater in the public sector. Workers employed in private companies are much less likely to strike, one reason being that an extensive labor dispute could push a teetering company to fold. In the public sector, however, such a fear is baseless. After all, when was the last time you heard about a government ministry or agency closing after failing to turn a profit?

Despite a slate of reforms that aimed to transform Israel from a centralized, socialist economy to a competitive market system, the size of the public sector remains among the highest in the West. Moreover, a large portion of the services provided by this sector are monopolistic.

In addition, the power of militant workers committees, who have every incentive to strike, has contributed to the increase in the number of strikes in essential services.

Finally, and quite astonishingly, Gordon points out that there is virtually no direct legal limitations on the right to strike in Israel "of the kind that exist almost everywhere in the industrialized world." For example, countries such as the United States, Canada, and Japan have banned strikes outright in key public sector industries, referring all labor disputes to binding arbitration instead. In Israel, however,"such a ban exists only in one narrow area of the public sector: The police and other security services."

One tried and true way to minimize the damage of labor disputes is to implement binding arbitration, a procedure that would ban the vast majority of strikes. Arbitration resolves claims and disputes inexpensively and expeditiously by having them heard entirely by an independent arbitrator. In addition, arbitration places the trust of judgment with an expert in the field of the claim or dispute.

However, until the Israeli government takes concrete steps to ensure that public sector disputes cannot cripple the entire economy, fathers like me will continue to live on a razor's edge, between crunching numbers at work and changing dirty diapers at home.

Ah, my WhatsApp just beeped…

Gidon Ben-Zvi, former Jerusalem Correspondent for the Algemeiner newspaper, is an accomplished writer who left behind Hollywood starlight for Jerusalem stone in 2009. After serving in an Israel Defense Forces infantry unit from 1994-1997, Ben-Zvi returned to the United States before settling in Israel, where he and his wife are raising their four children to speak fluent English – with an Israeli accent. Ben-Zvi's work has appeared in The Jerusalem Post, The Times of Israel, the Algemeiner, American Thinker, the Jewish Journal, Israel Hayom, and United with Israel. Ben-Zvi blogs at Jerusalem State of Mind (jsmstateofmind.com). For more of his reports — Click Here Now.

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Being arguably the most strike-addled economy in the industrialized world is making it more difficult for Israel to compete in an increasingly globalized marketplace.
jerusalem, strike, labor, israel, business
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2017-07-01
 

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