New Agreement Gives Israeli Workers a 17.9% C.o.l. Hike

Israeli wage-earners will receive a 17.9 percent interim cost-of-living allowance next Sunday under an agreement signed last night by Histadrut and the Employers Association. The advance, to ease the shock of record inflation in the last two months, will be followed next month by the regular c.o.l. increment of nearly 50 percent due on January salaries.

The agreement averted a threatened series of wildcat strikes in most branches of the economy. It was signed after a day of protest rallies at some 300 factories all over the country. At the same time, Ezra Sadan, Director General of the Finance Ministry, authorized an adjustment of income tax brackets to make sure that the workers’ gains are not nullified by placing them in higher tax brackets.

The last c.o.l. allowances were wiped out by the 21.1 percent rise in living costs in October, the all-time record for a single month, followed by a 15.2 present increase in November, the second highest monthly increase and the highest ever for November.

The agreement signed last night brought no relief to Israeli merchants engaged in the import-export trades or to citrus growers. Longshoremen at Haifa and Ashdad are continuing their work slowdown which has caused thousands of tons of produce to rot on the docks. Negotiations with the stevedoring companies broke down last week causing citrus growers to stop harvesting at the peak of the export season.

Imported goods bound for Israel have been dumped at Limassol, Cyprus by ships which refuse to enter Israel’s strikebound ports. Other ships have been diverted to the port of Eilat via the Suez Canal. This adds to the cost of goods because of the longer voyage and canal tolls.

Meanwhile, disgruntled employes of the Defense and Welfare ministries have stepped up their work sanctions, refusing to negotiate their grievances through outside mediators. Railway workers have threatened a three-day strike this week.