El Al could fire 1,000 people, nearly sixth of workforce, over virus losses

Company scrambles as transportation, tourism industries rocked by coronavirus, Health Ministry restrictions; airline and representatives of its 6,300 workers in talks

Israeli airline El Al planes parked at Ben Gurion Airport in Lod, Israel, on March 16, 2018. (Moshe Shai/Flash90)
Israeli airline El Al planes parked at Ben Gurion Airport in Lod, Israel, on March 16, 2018. (Moshe Shai/Flash90)

El Al Airlines is formulating a plan to fire some 1,000 employees, nearly one-sixth of its workforce, due to financial losses caused by the coronavirus outbreak.

Both the company and employees are in talks with labor union representatives; the announcement of the plan does not actually mean that 1,000 people will be fired. The company employs some 6,300 people, 3,600 of whom are permanent workers.

Gonen Usishkin, the company’s CEO, wrote in a letter Thursday to senior executives: “In light of recent developments and the decrease in activity, I am instructing the VP of human resources to formulate a plan to reduce the company workforce by 1,000 people.”

“I’m emphasizing that the goal is to implement the plan immediately,” Usishkin wrote, according to the Calcalist business news site.

The plan is likely to include workers from all departments, and include both tenured and temporary employees.

Three hundred company employees were immediately placed on leave.

Some employees are in self-quarantine already, according to Health Ministry guidelines, after returning from countries hit by the virus.

The announcement may also be a starting point for negotiations — the company’s management has reportedly been negotiating for several days with a team from the Histadrut umbrella labor union. The two sides are discussing alternatives to the outright firing of 1,000 workers, the report said.

Representatives of El Al’s employees were also meeting with the Histadrut.

The labor union said Thursday that workers from El Al and Israeli airlines Israir and Arkia would hold a demonstration in front of the Knesset on Sunday.

El Al told Israeli investors on Thursday that the company expects to see a loss of $50-70 million in revenue between January and April. The airline’s stock price dropped 7.47 percent on Thursday, and shares have fallen 20% since the start of 2019.

El Al on Thursday said it was suspending flights to Italy and Thailand due to the virus, and that it would delay its planned launch of direct flights to Tokyo until April. The airline extended its halt of flights to Beijing and Hong Kong until May.

On Wednesday El Al reportedly said that it and other Israeli carriers could collapse financially in a matter of “weeks” due to the Health Ministry’s increasingly stringent travel restrictions and warnings related to the coronavirus.

Israel has banned foreigners who were recently in China, Hong Kong, Macau, Thailand, Singapore, South Korea, Japan and Italy, and ordered Israelis returning from those countries to self-quarantine.

The Health Ministry urged Israelis Wednesday to seriously consider refraining from traveling abroad, becoming the first country to issue such a statement.

The Health Ministry said Thursday that an Israeli man who returned from Italy tested positive for the disease, the first case of an infection in the country outside of a hospital quarantine, raising fears he may have infected others.

The coronavirus, which emerged in China late last year, has killed over 2,760 people and infected over 81,000 in 45 countries. The vast majority of infections and deaths have been in mainland China.

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