by Ifi Reporter Category:Banking Aug 26, 2018

The labor dispute at Leumi Card is approaching the decisive point. Last Thursday, the workers' committee of the credit card company decided to launch a general strike indefinitely, which continued today. The strike was also backed by the decision of the Labor Court last weekend, according to which there is no obligation to operate the permits and signatures Hotline, although the committee decided to operate it,  in a limited format.
The Leumi Card Employees Committee, headed by Reut Pavlovitch, declared a labor dispute more than a month ago, and has been taking sanctions for three weeks. The dispute was announced against the backdrop of gaps in negotiations in the collective agreement that ended last March, and against the background of the bonus for employees for the sale of Leumi Card to the Warburg Pincus Fund for NIS 2.5 billion
Although the gaps between the sides are not dramatic, it seems that they are unable to reach agreements, and the conflict has intensified in the last two weeks, until a full-time strike was declared indefinitely. "Globes" has learned today that Leumi Card CEO Ron Fainaro is scheduled to hold a meeting with the Chairman of the Ma'on Federation, Arnon Ben David, since the committee is already taking the most extreme step - an indefinite strike that harms the company's operations - The expectation is that the conflict will end in a short time, perhaps this week.
The conflict focuses on two factors. The first is the conditions for renewing the collective agreement, where the gaps are not high. Among the main points of disagreement are wage increases and welfare budgets. The Company's management wishes to provide modest salary increases, on the grounds that the Company anticipates challenging years of decline in profitability due to regulatory changes and other changes in the market.
However, in light of the fact that Schurburg Pincus has agreed to acquire control of the company after a deep examination of 30% of its shareholders' equity, and with the expectation that the company's value will only increase in the coming years, it is difficult to convince the committee that the company is facing a problematic period.
"The collective agreement at Leumi Card ended three months ago, and the management and representatives of the committee are in intensive negotiations to form a new agreement to satisfy the parties in order to preserve the welfare of the employees and the stability of the company."

After a year-long process, Leumi Bank and the Azrieli Group agreed to sell the Leumi Card credit card company to US private equity fund Warburg Pincus. Leumi Card, which is 80% held by Leumi and 20% by Azrieli, is sold to Warburg Pincus for a basic sum of NIS 2.5 billion, 30% more than Leumi Card's equity, which amounted to NIS 1.9 billion at the end of March 2018.




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