El Al to Workers: Bailout Depends on Labor Agreement

el al
(Moshe Shai/Flash90, File)

El Al’s troubled labor relations now threaten its prospects for obtaining a desperately-needed loan package, CEO Gonen Usishkin told the company’s workers in a letter sent on Tuesday.

“The threshold condition for obtaining a bank loan with a state guarantee is the signing of a labor agreement. Without a loan, El Al will not be able to stay in existence,” Usishkin wrote, according to Globes.

Referring to a meeting of management and the Histadrut that was violently disrupted over layoff issues on Monday, he said, “We understand that these are difficult, painful times, but we will not allow violence. El Al’s people are under great pressure because of the complicated situation in which the company finds itself.”

According to reports, union representatives broke into the meeting and threw chairs, spilled coffee in protest against the proceedings. The Histadrut subsequently suspended the union leadership for its conduct.

The meeting was held to discuss a proposed cut to pilots’ pay, which is expected to be about 40 percent (partly because of the expected low level of aviation activity in the next few years).

In a video clip, Avi Edri, chairman of the Transport Workers Union in the Histadrut, said, “The pilots’ committee that everyone is trying to incite against is supposed to give $110 million of the pilots’ compensation as a contribution to annual cost savings. Almost 50% of the cost savings that the company is meant to undertake is coming from the pilots. El Al’s workers, led by the head of the workers’ committee, simply broke up the meeting, behaved violently, broke tables, and simply caused chaos in the room. The union cannot overlook the incident. In the light of behavior that cannot lead anywhere we have decided to disband the committee, to take matters into our hands, and to conduct negotiations with workers’ representatives who show responsibility.”

Seeking to set the record straight, Usishkin noted that “Contrary to the reports that have been spread abroad, the number of pilots active during the coronavirus crisis is much lower than 50%. It ranges between 20% and 40%, in accordance with the level of activity and the need to operate all the flights.”

He added that El Al is in seeking ways to bring employees back from unpaid leave. El Al recently stated that the workers on unpaid leave, about 90% of its total workforce, would remain so until the end of June.

Meanwhile, compounding the airlines’ woes, the Airports Authority has demanded that El Al pay back tens of millions in fees it owes for office space and parking for its planes at Ben Gurion Airport over the past three months, according to Ynet on Tuesday.

The Airports Authority, also suffering financially from the coronavirus crisis, needs the funds to replenish its dwindling cash reserves, the report said.