Hadera Paper Ltd. (TASE: HAP; Pink Sheets: HAIPF) has withdrawn the threat to fire 250 employees and ended the lockout, after management and the Histadrut (General Federation of Labor in Israel) signed a new labor contract today. Employees have resumed regular work.
The Histadrut said that the contract's details would be published later today. It reportedly includes a pay cut for employees and cancellation of their annual bonus. It also creates a new status of employees who will receive tenure after five years, but at lower salaries than the ones prevailing today.
Management has reportedly promised to restore the pay cut and bonuses when the company returns to profitability. It also promised larger pay hikes as profits grow.
During the labor dispute, Hadera Paper, run by CEO Ofer Bloch, took a controversial, but effective, step: it initiated a lockout and threatened to fire 250 employees, while saying that it would not withdraw the moves until a labor contract was signed on its terms. Union sources fear that the company success could adversely affect other workplaces.
"I congratulate the workers committee and management for the responsibility shown, and I am pleased that hundreds of families will not fall into unemployment and that their livelihoods have been saved," said Histadrut Trade Union Division chairman Avi Nissenkoren this morning.
Published by Globes [online], Israel business news - www.globes-online.com - on December 12, 2013
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