El Al Israel Airlines Ltd. (TASE: ELAL) has announced new cost-cutting measures in the wake of its $23 million loss in the second quarter, and the new cutbacks affect not just service, but also employees. Sources inform ''Globes'' that the airline, run by CEO Eliezer Shkedi, has notified employees that it is suspending overtime and halting work on Saturdays in departments that were previously required to work on the weekend.
El Al's management told the workers committee that this was just the first step, and that it would open negotiations on a comprehensive streamlining plan on job conditions. The latest measures were preceded by two major moves: the closing of El Al's service center in Haifa, and the reduction of flight stewards in tourist class by one steward in flights of up to four hours and two in longer flights.
A top Histadrut (General Federation of Labor in Israel) official told "Globes" today that he was aware of the airline's troubles and that its employees would have to accept cutbacks. "They're going through turbulence," he said.
El Al workers committee chairman Yossi Levy told "Globes", "I cannot fight the company's decision to suspend overtime or Saturday shifts, but I will not permit any other cutbacks, unless management cuts back first."
Levy added, "You want cutbacks? First narrow the gap between workers and management. It's unacceptable that workers earn NIS 4,500 a month and executives earn NIS 300,000. I told Shkedi when he took up his post that the people who put the airline through its nosedive in 2009 should not remain, but 90% of the managers who were here then still have their jobs."
Levy frequently butted horns with Shkedi's predecessor, Haim Romano, saying once, "We'll make him feel that he's in an ejector seat". Today, however, Levy opted to flatter him, while lambasting El Al's current leadership.
Levy said, "It is to Romano's credit that he never harmed service. On the contrary, instead of four flight stewards, he put six on the planes. Now, they're satisfied with three. Stopping overtime means worse service, it means more grounded flights because there is no one to take care of them. That's what happens when a major general (Shkedi, a former Israel Air Force commander) and a brigadier general (Yehudit Gilisrin, El Al's VP service), and colonel (Avishai Ilan, El Al service division chief) are brought in. They were the ones who gave and received orders for 30 years. They don’t know what service is, they don’t know how to say please and thank you. Major General Shkedi may have been the strongest Air Force commander ever, but he appears weak as a civilian."
El Al's management opted for a laconic response with no mention of Levy's tirade, saying, "All airlines in world must streamline, especially El Al. El Al's future and its passenger service are management's guiding light."
Published by Globes [online], Israel business news - www.globes-online.com - on September 14, 2011
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