Sources inform ''Globes'' that Zim Integrated Shipping Services Ltd. will shortly send 70 employees over the age of 50 on early retirement. The company has 700 employees, and it is cutting its workforce by 10%. The early retirement was included in the special labor contract signed between management and the workers committee.
The reduction in workforce is one of Zim's numerous cost-cutting measures to cope with the slump in global shipping. The company has also mothballed 20 ships and eliminated some routes.
The special labor agreement also suspends for this year the annual automatic pay grade increases, which boost employees' salaries. Zim employees view this measure as tantamount to a pay cut. Zim workers committee chairman Avi Sheetrit confirmed the report. He told "Globes" that while the special agreement applied only to 2009, the alternative was more job losses at the company. He added that the regular labor contract would come back in force on January 1, 2009.
Zim employees had thought that management would seek the retirement of employees over the age of 55, and were taken by surprise when the cut off was lowered to 50 - 17 years below the mandatory retirement age.
Zim is owned by Ofer Holdings Group unit Israel Corporation (TASE: ILCO). Zim was unavailable for response by web-posting.
Published by Globes [online], Israel business news - www.globes-online.com - on March 17, 2009
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