Israel Electric Corporation (IEC) (TASE: ELEC.B22) CEO Eli Glickman has declared a state of emergency at the utility over the management's fear that employees will go on strike immediately. The management said today that the workers had threatened to take unprecedented action, following the collapse of talks on reform at the utility.
"Globes" reported on Saturday evening that Director of Wages Kobi Amsalem had disqualified pay supplements for IEC employees and ordered them to repay money he says they received illegally.
IEC workers committee chairman Miko Tzarfati today convened all divisional managers for a meeting, which was described as stormy. He said that IEC was headed for bankruptcy while the government broke off the talks on reform at the utility. He added that IEC's board of directors was "alienated" and was unaware of the difficult situation, and revealed that he had advised Glickman "to lay down the keys and resign". He was cheered by the division managers and their deputies when he told them "to sit a home" until the government announces its intentions for IEC.
This afternoon, the Histadrut (General Federation of Labor in Israel) declared a labor dispute at IEC. "The labor dispute covers all 13,000 IEC employees, and has been declared following the demand that the workers should sign a collective labor agreement that will regulate all the employees' rights and employment conditions as part of the reform. It also relates to the unilateral steps against the backdrop of the restructuring and the demand by the Director of Wages to reduce the workers' rights," said the Histadrut in the statement.
Tzarfati was infuriated at the letter Amsalem sent last Thursday in which he announced his intention to order IEC employees to repay money which he said they were paid illegally. IEC's management and employees argue that Amsalem's act completely contravened statements by Ori Yogev, who chairs the government committee on the reform of the electricity market.
Yogev had promised that no unilateral steps would be taken while the committee was working, but Amsalem, a member of the committee, says that he has no discretion that would allow him to delay his actions on salary irregularities.
On Monday afternoon, the Haifa District Labor accepted IEC management's petition and ordered the workers committee not to undertake any labor sanctions in response to Amsalem's decision that IEC employees and pensioners should repay the salary supplements. The court ordered the workers committee to order IEC managers to return immediately to full and regular work. It also ruled that Amsalem's decision will not come into effect until the court rules otherwise. The court scheduled a hearing in the presence of both parties for 8 am Wednesday.
Published by Globes [online], Israel business news - www.globes-online.com - on October 14, 2013
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