* Treasury says strike may cost economy $500 million a day
* Union wants government to hire contract workers
(Adds Labour court extends deadline)
JERUSALEM, Feb 8 (Reuters) - Israel's main labour
union went on strike on Wednesday shutting airports, ports,
banks and the stock market after talks with the government
failed to produce an agreement on the status of contract
workers.
The Histadrut labour federation, the umbrella organisation
for hundreds of thousands of public sector workers, said the
strike - estimated by the Treasury to cost the economy $500
million a day - would also halt trains and close the Bank of
Israel and government offices.
Ben Gurion International Airport near Tel Aviv was shut for
six hours, delaying many flights, while the strike for all other
services was open-ended, Histadrut said.
"This strike is not only unnecessary but it endangers the
Israeli market, the Israeli economy and the citizens of Israel,"
Finance Minister Yuval Steinitz said on Israel Radio.
Histadrut chairman Ofer Eini said: "The only weapon workers
have is the weapon of a strike."
Treasury and Histadrut officials held talks behind closed
doors, and a labour court judge gave the two sides until early
Thursday to settle the dispute, leaving the door open for the
strike to go into a second day.
Histadrut wants the government to hire about 250,000
contract workers, such as cleaners and security guards, whose
working conditions are inferior to workers directly on
government payrolls.
The Finance Ministry said it cannot take on that many new
workers but has offered to improve their conditions by raising
salaries by at least 20 percent and giving them more holiday.
Histadrut went on strike for the same reason last November,
but on that occasion the labour court limited the action to just
four hours and ordered the two sides to work out a deal.
(Reporting by Steven Scheer, Ari Rabinovitch and Allyn
Fisher-Ilan; Editing by Janet Lawrence)
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