Teva agrees to delay some layoffs at Jerusalem plant
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Teva agrees to delay some layoffs at Jerusalem plant

Pharma firm's management says facility is to close by 2019 as planned; expects protesting employees to return to work on Monday

Teva Pharmaceutical Industries employees  protest in front of the Prime Minister's Office in Jerusalem against the company's plan to lay off hundreds of workers, December 17, 2017.(Yonatan Sindel/Flash90)
Teva Pharmaceutical Industries employees protest in front of the Prime Minister's Office in Jerusalem against the company's plan to lay off hundreds of workers, December 17, 2017.(Yonatan Sindel/Flash90)

In what was hailed as a victory for Israel’s labor unions, Teva’s management on Sunday decided to delay the layoff of some of the workers at its Jerusalem plant, even while saying the plant would be closed down in 2019 as planned.

Some 340 workers were scheduled to have been fired in the first wave of layoffs at the start of 2018, ahead of the closure of Teva’s pill-manufacturing Jerusalem plant. After workers barricaded themselves into the building, management reached a compromise with the workers union and agreed that in the first stage of layoffs only some 200 workers would lose their jobs at the Jerusalem plant. The final count of layoffs will be unchanged, however, and the plant is still scheduled to close as planned in 2019, Teva said.

The Hebrew-language media has in the past days dubbed Teva’s new Danish CEO Kare Schultz “Kare the terrible” and a popular satire program portrayed him as a cold, calculating personality determined to go ahead with the job cuts.

Prime Minister Benjamin Netanyahu, Finance Minister Moshe Kahlon and Economy Minister Eli Cohen met with Schultz earlier this month to try to figure out how best to soften the blow of the Israeli drug-maker’s plans to cut its local workforce. A key request by Israeli leaders was to keep the Jerusalem production plant open. But Teva CEO rejected their request, while pledging the firm will keep its global headquarters in the Jewish state and work closely with an Israeli team to help dismissed workers find alternative employment.

Kåre Schultz, the newly appointed CEO and president of Teva. (Courtesy)

One of the world’s largest generic makers of drugs and one of the nation’s largest employers, Teva had been until recently a symbol of Israel’s industrial success. The company’s shares were a staple in local savings plans, earning the nickname of “the people’s stock.”

On December 14, the company, which is dogged by debt, announced a restructuring plan that envisages the firing of 14,000 Teva workers worldwide over the next two years — more than a quarter of Teva’s global workforce of over 55,000 — including some 1,750 in Israel.

“Teva is conducting an intense process of consultation with the unions and is close to reaching agreements regarding the number of employees to depart the Jerusalem site in the first quarter of 2018, as well as regarding the process of closing the Jerusalem site at the end of 2019, as was communicated,” Teva said in a statement Sunday, adding that it expected Teva’s employees at the Jerusalem plant to return to work on Monday.

“Teva is committed to a fair process and to providing assistance in training and search for employment opportunities to employees whose position has become redundant,” the statement said.

Zionist Union MK Amir Peretz, a former head of the Histadrut labor federation, said the concession was a sign that Teva management had come to grips with the reality in Israel and called the deal a testament to the “solid front” presented by the workers.

“Teva’s management thought it could disregard the Israeli government and the workers’ organizations and send all the dedicated Israeli workers home. But it met with a solid workers’ front and solidarity of the Israeli society,” Peretz said.

“We will continue to struggle” for the last of Israel’s employees, he said.

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