Teva, workers sign accord on Jerusalem factory closure terms
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Teva, workers sign accord on Jerusalem factory closure terms

Deal stipulates the factory will be shut down in 2019 and workers who are laid off will get training and counseling; staff to end strike at plant

Workers of the Teva company protest against the company plan to lay off hundreds of employees, outside the TEVA Pharmaceutical Industries building in Jerusalem, December 14, 2017. (Yonatan Sindel/Flash90)
Workers of the Teva company protest against the company plan to lay off hundreds of employees, outside the TEVA Pharmaceutical Industries building in Jerusalem, December 14, 2017. (Yonatan Sindel/Flash90)

Israel’s Teva Pharmaceutical Industries and the the Histadrut Leumit workers union said Tuesday they reached and signed an agreement regarding the terms of the closure of the tablet factory in Jerusalem.

In a joint statement, Teva and the workers representatives said that
“following intense negotiations and open dialogue” the parties reached a “full agreement” on how to close the tablet factory in Jerusalem at the end of 2019. The accord will put an immediate end to the labor dispute at the factory and an “orderly return to work.”

The agreement stipulates that the first wave of layoffs planned for the first quarter of 2018 will be reduced, and postpones the termination of most of the employees of the Jerusalem tablet factory to December 2019.

Some 340 workers were originally scheduled to be fired in a first wave of layoffs at the start of 2018, ahead of the closure of Teva’s pill-manufacturing Jerusalem plant. After  workers barricaded themselves in 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.

Workers of the Teva company protest against the company plan to lay off hundreds of employees, outside the TEVA Pharmaceutical Industries building in Jerusalem, December 14, 2017. (Yonatan Sindel/Flash90)

In addition, the parties set up a plan to provide “an optimal and fair retirement framework for employees” who will be laid off, either in the first quarter of 2018 or at the end of 2019 — upon the final closing of the plant, the statement said.

The framework includes packages to help workers transition to an alternative workplace and counseling, workshops and professional training for those who will  depart. Teva will also set up, near its Jerusalem site, a center for professional training to coordinate and connect potential employers to laid-off workers.

Even so, the workers hoped the plant would continue to be open even after 2019.

“Teva Tablets will continue to exist for at least another two years, and we are confident that with God’s help it will continue beyond that,” said Itzik Ben Simon, chairman of the workers’ committee at Teva in Jerusalem in a statement.

“In a joint effort, we succeeded in reducing by more than a third the number of workers leaving at the beginning of the year, so that the vast majority of workers will remain with employment security in the next two years,” said Sassi Sadeh, head of the Histadrut Leumit trade union division. “I hope that the plant will nevertheless continue to work even in 2020 and beyond,” he said.

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

Prime Minister Benjamin Netanyahu, Finance Minister Moshe Kahlon and Economy Minister Eli Cohen met with Teva CEO and president Kare Schultz last 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 Schultz rejected their request, though he pledging to keep the firm’s global headquarters in the Jewish state and work closely with a team to help dismissed Israeli workers find alternative employment.

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 envisaging 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.

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