Labor Court will decide whether El Al can withdraw NIS 115 million from its employees' pension fund

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by Ifi Reporter Category:Financial Apr 29, 2020

The Bat Yam Labor Court will hold a crucial hearing on Thursday for the airline. The tribunal will have to decide whether El Al can withdraw NIS 115 million from its employees' pension fund, as the company's fund - whose operations are almost completely disabled - is depleted. The amount is needed by God on interim financing until government assistance is granted - a $ 400 million state guarantee loan that has not yet been approved.
The Histadrut - contrary to its position in the past and contrary to the position of workers who oppose the appeal - supports El Al's request. A Histadrut source explained the turnaround in her position: "We were convinced that without the release of the amount, there would be no salaries for 700 employees who worked during the crisis and the company would have no funds for fixed expenses payments.
"In light of the fact that most of the funds in the pension fund will not be released and left to the court's decision, and in light of the fact that without the company release the company will not pay salaries and meet its obligations - we decided to introduce a position that allows the funds to be released."
It should be noted that the Histadrut is the body that represents and accompanies the representation of El Al employees in their fight against management and dismissal, which are included in the recovery plan. Tomorrow the workers will protest in front of the Labor Court. According to the committee: "We will protest against the company's management's intention to violate the workers' social rights, while the owner and the state are not helping."
The NIS 115 million required now is part of the NIS 500 million that is in the pension fund. The funds were deposited at the box office during the privatization of the company by the state, for the benefit of the workers who continued to work there with the move to private hands.
This amount has been in legal dispute for years. The state is suing Al for the balances left in the fund after the funds were diverted to workers, while El Al claims that the amount belongs to it and now demands to withdraw NIS 115 million for its needs. In the past, the Histadrut was at one point with the workers opposed to the appeal.
At the same time, El Al continues to seek a bank that will provide the State guarantee loan and is in contact with Bank Leumi and Bank Hapoalim, after the deal with Discount failed, because the preconditions were reached - agreements with the employees and agreements with the Treasury on the level of the guarantee the state will provide.
On Wednesday, El Al received a two-week extension from the Securities and Exchange Commission for filing its financial statements, which, if filed, would include a "live business note." It should be noted that El Al is the only company to receive a special extension from all of the Tel Aviv Stock Exchange listed companies, whose reasoning is that its entire management is engaged in the company's rescue efforts and does not turn to the financial statements.

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