El Al’s labor union will convene an emergency meeting of the national carrier’s workforce Sunday, after the airline said it was formulating a plan to fire some 1,000 people, nearly one-sixth of its workers, due to financial losses caused by the coronavirus outbreak.
After the firing announcement Thursday, representatives of the employees and the Histadrut umbrella labor union met with El Al management for talks that lasted late into the night, but did not reach any agreements on the planned layoffs.
The company’s announcement on the planned firings were seen as part of a negotiation tactic in talks with labor 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.
The Sunday meeting will be held at the El Al union’s offices at Ben Gurion International Airport, the Calcalist business daily reported.
The negotiations between El Al management and labor representatives are expected to continue throughout the week.
The El Al union, also known as a workers’ committee, was reportedly surprised by the scope of the firings plan, despite the company’s earlier warnings that the virus outbreak would cause tens of millions of dollars of revenue losses.
The committee is said to be exploring options for reducing the company’s workforce without axing employees, including by giving up on paid vacation days and reducing the number of shifts people work.
If the two sides do not reach an agreement in the coming days, El Al is expected to start handing out pink slips. The workers are likely to take steps in retaliation, including possibly going on strike.
Government ministers are set to hold a meeting Sunday in Tel Aviv on the economic threats posed by the virus, and are likely to discuss damage to the tourism industry. The company hopes the government will decide to give assistance to the beleaguered airline, although such a move might be complicated by Monday’s election.
In his Thursday letter to senior El Al executives, CEO Gonen Usishkin wrote: “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.
The plan is likely to include workers from all departments, and include both permanent and temporary employees.
Three hundred 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.
Histadrut 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. It has been offering customers the ability to cancel their tickets with little notice.
In one bright spot for the airline, fuel prices have dropped worldwide due to a decrease in demand as the virus rocks the global travel and transportation industries.
Israel has implemented a strict border control regime to stem the flow of the virus, banning 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 an advisory.
Israel has had seven confirmed cases of the disease and no deaths.
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.
Meanwhile, Hungarian low cost airline Wizz Air is cutting back on its flights between Israel and Europe due to low demand, the Globes business daily reported. Wizz Air is the most active foreign airline operating out of Ben Gurion airport.
Flights between Tel Aviv and Vienna will be canceled outright, while some routes, including those to London, Sofia, and Krakow will be operating less frequently.
The coronavirus, which emerged in China late last year, has killed over 2,900 people and infected over 86,000 in 61 countries. The vast majority of infections and deaths have been in mainland China.