Hundreds of employees will be fired in the coming months, and the others will suffer a dramatic pay cut, Israel Electric Corporation (IEC) (TASE: ELEC.B22) CEO Eli Glickman stated today in a hearing at the Haifa Labor Court. He was trying to make the judge realize the consequences for the workers committee of a failure to achieve reform in the IEC.
The Court convened today for a hearing on the right of the IEC workers committee to strike. "The supply of electricity will continue," asserted Histadrut (General Federation of Labor in Israel) chairman Avi Nissenkorn, but added that sanctions would be imposed.
The judge insisted on why the state had hardened its position at the last moment on the conditions it was willing to grant IEC employees, despite the general feeling that the Yogev Committee for Reforming the IEC and the Electricity Sector would soon reach understandings with the workers committee. "Someone is confused," Nissenkorn said, and Glickman added that if the reform is not carried out, it would have a very serious effect on the workers: hundreds would be laid off, and others would have their pay steeply reduced.
"In the end, the responsibility for making decisions lies with the government ministers, Government Companies Authority director General Ori Yogev asserted, adding that setting a uniform government policy was no simple matter.
Before any decision was taken, and following the hearing, the private electricity producers will also be heard. The state's proposal to the IEC in exchange for consent to reform in the company is a take it or leave it offer. It includes sale of power stations, offering 15% of IEC on the stock exchange, cutting 1,700 full-time jobs at IEC, a NIS 50,000 grant to the remaining employees, a NIS 1,000 pension bonus, and monetary compensation for waiving the free electricity benefit equal to half its maximum value.
Published by Globes [online], Israel business news - www.globes-online.com - on September 15, 2014
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