Katz attacks Egged ahead of Tuesday's strike

Yisrael Katz  photo: Eyal Yitzhar

The Transportation Minister told Egged, "You're dinosaurs. If you don't do what's needed, you'll become extinct."

"You're like a dinosaur refusing to adapt itself to the changing situation. If you don't do what's needed, and don't take the right decisions now, you'll become extinct. Despite my appreciation for the company's capabilities and history, I won't give in, and if I have to wage a public struggle, as I had to do at the ports and other places, I'll do it, and I won't let any political group interfere," Minister of Transport Yisrael Katz told Egged Israel Transport Cooperative Society Ltd.'s management yesterday in a meeting at his office in Tel Aviv, following the threat of a strike by the cooperative starting tomorrow morning.

The meeting was attended by senior Egged executives and Histadrut (General Federation of Labor in Israel) officials, including Histadrut chairman Avi Nissenkorn, and representatives from the Ministry of Finance Budgets Department and the Ministry of Transport. During the meeting, Katz ordered Egged's management to enter intense negotiations with the workers on their employment terms, and "not to hold the workers hostage in the framework of the negotiations they are conducting with the government over continuation of the reform in public transportation." At the same time, he ordered the Ministry of Finance to transfer the necessary subsidies to Egged, and not to use them as a bargaining chip.

Following Katz's remarks, negotiations on a new collective work agreement at Egged to replace the previous agreement, which expired 18 months ago, are in progress. The negotiations are taking place at the Egged building in Beit Dagan, with the participation of representatives of the workers' committee, Transportation Workers Union chairman Avi Edri, and representatives of the Egged economic department, headed by Egged CFO Gilad Riklin.

The workers' representatives are seeking a differential agreement in which veteran Egged workers earn more than NIS 39 an hour - the minimum wage in the sector earned by beginning drivers. The particulars of the agreement, should one be reached, will be part of the basic figures for the negotiations to be conducted later by Egged management with the Ministries of Finance and Transport on Egged's new subsidy agreement. The gaps between the parties in these negotiations amount to billions of shekels.

The Histadrut today issued a statement saying, "If no last-minute solution is found, all Egged bus lines will go on a general strike starting tomorrow morning at 5:00 AM. The reason for the strike is the delaying tactics used by the Ministries of Finance and Transport in the negotiations with Egged management on a new subsidy agreement, which is preventing the signing of a new collective work agreement at Egged and significantly affecting the driver's incentive pay, with an emphasis on the terms for veteran drivers."

With the announcement, Nissenkorn is trying to induce the ministers to intervene over the heads of the officials, and enforce a solution that the officials are unwilling to accept. "The Egged cooperative, which has been operating on a national level for over 84 years, is on the verge of collapse, because the officials are delaying a solution," Nissenkorn said, "What is involved is not just the fate of thousands of drivers; it is a public interest that must not be neglected. I hope that the Ministers of Transport and Finance buckle down and do what is necessary to find a solution and avoid an unprecedented crisis."

Katz's statement that Egged's management is using the workers to pressure the government to sign a better subsidy agreement with it was not made in a vacuum. Egged's management benefited from the workers' protests in October, when they threatened to go on strike at the beginning of November during the subsidy agreement crisis. The threat of a strike helped Nissenkorn put pressure on Minister of Finance Moshe Kahlon to intervene in the crisis. Kahlon delegated Ministry of Finance director general Shai Babad to conduct the negotiations. Shortly afterwards, an immediate transfer of NIS 150 million to Egged was agreed to finance the company during an intermediate one-month period, during which "accelerated negotiations" would take place. Due to wide gaps between the parties and the absence of ministerial involvement, no effective negotiations have taken place since, and certainly no accelerated ones, and the crisis has been renewed.

In the framework of the tough negotiations on the subsidy agreement to replace the previous agreement, which expired at the end of 2015, the Ministry of Finance is demanding, among other things, that Egged become a company, instead of a cooperative, give up almost half of the lines it operates, and bring in an investor with a stake of at least 51%. Egged is refusing to give up the lines and is asking for a retirement subsidy for 1,500 members and 2,400 veteran employees over 18 years, at a cost of NIS 1.5 million per retiree. The Ministry of Finance says that the extra costs Egged is asking for total NIS 6 billion.

In yesterday's meeting in his office, Katz supported the Ministry of Finance's position, saying that Egged had to adapt itself to the era of competition and the level of service required of a modern public company, "as in the world's developed countries… The goal is efficient public transportation at a European level, as we are promoting in the public transportation reform."

Egged management's response to the threatened strike supports the arguments that it is playing a double game in which it is tying the collective agreement to the subsidy agreement: "Egged management regrets the decision by the Histadrut and the national workers' committee to strike the company's services. It is possible to understand and sympathize with their justified concern about the loss of their economic horizon, due to the prolonged and perhaps deliberate foot-dragging (18 months of useless talk) by the government ministries in the negotiations with Egged management, which has prevented the renewal of the collective agreement between Egged management and the national workers' committee and the Histadrut.

"Egged management will do everything possible to prevent, and certainly to minimize, the damage caused by the strike, to the best of its ability, by operating a few services lines using Egged members with driving licenses for buses. These account for 20% of all of the company's drivers. We call on the Ministers of Finance and Transport to get involved immediately in order to prevent the transportation chaos liable to ensue next Tuesday, with severe and long-lasting damage to the economy and the company."

Published by Globes [online], Israel Business News - www.globes-online.com - on March 20, 2017

© Copyright of Globes Publisher Itonut (1983) Ltd. 2017

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Yisrael Katz  photo: Eyal Yitzhar
Yisrael Katz photo: Eyal Yitzhar
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