Regulation on Migrant Workers’ Employment in the Israeli Construction Sector

Published date01 December 2015
Date01 December 2015
AuthorYoram Ida,Gal Talit
Regulation on Migrant WorkersEmployment
in the Israeli Construction Sector
Yoram Ida* and Gal Talit*
This article deals with a reform in the regulation on employment of migrant workers which
was implemented in the Israeli construction industry from 2005. This corporations-based
arrangement replaced a restrictive employment arrangement which tied the employee to a spe-
cif‌ic employer. The new regulation of work conditions and wages, coupled with a signif‌icant
reduction in the number of work permits issued to construction, has improved work conditions
and wages paid to migrant workers, and made their employment less attractive to employers.
The reform also included elements designed to reduce the illegal employment phenomenon
and to encourage migrant workers to leave the country at the end of their contracts. However,
the new arrangement still restricted the mobility of migrant workers to some extent and had
negative consequences such as a signif‌icant rise in the broker fees demanded of workers.
Regulation is at the heart of governmental activity in designing, implementing and evaluating pub-
lic policy. Its components include several def‌initions and types, some of which expand and some
of which reduce. Its most common denominator is that the state has a system of restrictions and
allowances on one hand, and authority to enforce them on the other, to safeguard public interest.
Regulation is implemented using a variety of tools at the governments disposal, such as laws,
modulation, standardization and supervision, which permit one behaviour or forbid another (Arbel-
Ganz, 2003; Black 2002; Goodship et al., 2004; Hood et al., 1999; Levi-Faur 2011; May, 2007).
Regulation is justif‌ied from a normative standpoint. Many of the rationales for regulation can be
described either as instances of market failures (economic regulation) or as ways to ensure the dis-
semination of justice (social regulation). In these cases government regulation can be justif‌ied,
because otherwise the uncontrolled market will fail to produce behaviour or results in accordance
with public interest (Arbel-Ganz, 2003; Baldwin and Cave, 1999).
One area where government regulation is considered necessary is that of migrant workers
employment, for two main reasons. First, it often has signif‌icant effects on the labour market in the
host country (Borjas, 2006). Second, it affects the socio-economic composition of the host country
and threatens its ethno-national homogeneity (Canetti-Nisim and Pedahzur, 2003). Thus, changes in
macroeconomic and/or political conditions may lead to changes in government regulation on the
employment of migrant workers (OECD, 2013).
This article examines the impact of regulatory changes on the employment of migrant workers in
the construction sector in Israel. Its main purpose is to augment the knowledge accumulated in the
*Tel Aviv University
doi: 10.1111/imig.12194
©2015 The Authors
International Migration ©2015 IOM
International Migration Vol. 53 (6) 2015
ISSN 0020-7985Published by John Wiley & Sons Ltd.

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