Pri Hagalil shuttered its canning factory in Hatzor Haglilit without warning on Friday afternoon, sending its 220 permanent employees on unpaid leave.

The factory has been at the center of a well-publicized dispute involving its owners, its workers and the government. The owners have said they will need to lay off employees if they don't receive a NIS 18 million grant they claim they were promised, while the Finance Ministry and the Industry, Trade and Labor Ministry have said the factory doesn't meet criteria to justify this. Meanwhile workers, many of whom are untrained and receive close to minimum wage, have repeatedly protested against any plans for layoffs.

The owners, who include Oshik Efraim and Zaki Shalom, said the workers were being placed on unpaid leave so that they could collect money from National Insurance.

Workers who came to the factory found the gates locked and security guards stationed outside.

"The factory management acted like thieves in the night. We're elderly and unskilled, and we have families. We're being left without an income, and we don't know who would hire us at our age," said one employee.

Workers were also angry that the move came shortly before Shabbat began. Many of the workers are Shabbat observant, and the timing left them unable to respond until last night.

Sources said the management had already started transferring raw materials out of the factory's storage facilities, and had not provided a real explanation as to why they were doing so.

Efraim said the decision to close the factory had come following an emergency meeting, and added that it was tied to a failure by the government to make good on a NIS 18 million grant. "Not just me but also the state is supposed to look out for the workers. We're not the Social Affairs Ministry," he said, blaming the government for the factory's closure.

The Industry, Trade and Labor Ministry denied that it promised the factory a grant, and that giving it one could pave the way for other factories to demand grants.

This is not the first time the management has tried to close the factory over the grant issue in the past year, even though the factory is not losing money and generates small profits every year.

The factory makes sauces, jams, frozen food products and packaged soups.

Beyond its permanent employees, the Pri Hagalil factory also employs 300 temporary workers.

Management intends to transfer production to the company's factories in Nahariya and Holon. Manufacturing in Nahariya is cheaper, since the company pays lower prices for water and municipal arnona taxes.

The Histadrut labor federation said it would try to keep the workers from being fired. It and the employees blocked 55 layoffs in November.