Workers at Israel Chemicals Ltd. (NYSE: ICL; TASE: ICL) are applying work sanctions this morning and disrupting the dispatch of goods at all the company's plants in the south of Israel. They are also preventing raw materials from being brought into the plants.
Bromine Compounds workers committee head Avner Ben-Senior said the sanctions were the workers' response to the streamlining plan that Israel Chemicals is introducing, which includes trimming the workforce and shutting down the magnesium plant at Sedom.
Ben-Senior added that disruptions to work would continue until further notice, and that the workers' committee intended to attend tomorrow's session of the Knesset Economic Affairs Committee and expose the committee members to the situation of the company following the recommendations of the Sheshinski 2 committee, which call for a higher government take from Israel Chemicals' profits.
Israel Chemicals management said, "Following decsions by the Israeli government and Sheshinski Committee, Israel Chemicals board decided to cancel all investments in Israel, and introduce a streamlining plan, which is necessary to reduce Israeli manufacturing operations. Israel Chemicals management has begun a process of implementing these decisions, including informing employees that it is forced to prepare for the day after Sheshinski including applying the streamlining in plants including cutting the work force and it has invited the workers committees to talks on the streamlining.
"Management hopes that the committees will understand the urgent need for streamlining and will lend support to cooperation for the company's future and its loyal employees. In recent years, Israel Chemicals has paid more than NIS 1 billion in revenues annually to the government. Following the decisions that the government took, which deviates from the Law for the Encouragement of Capital Investment, financing national projects to protect the Dead Sea's hotels, in addition to the Sheshinski recommendations, Israel Chemicals will pay NIS 1.5 billion anually from 2017, in addition to the billion that it already pays, for a total of NIS 2.5 billion annually.
"This is a large and very significant amount that requires Israel Chemicals to adapt its business strategy in Israel to the new situation, and it is doing this in accordance with the direction outlined by the Board."
Published by Globes [online], Israel business news - www.globes-online.com - on November 2, 2014
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