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Banking sector labor unions yesterday decided to launch an open-ended strike next Sunday. Branches of all the banks will be closed to the public, although automatic teller machines and online banking services will be operational, at least during the early days of the strike.

The action, which will involve all 40,000 banking employees, will paralyze trade on the Tel Aviv Stock Exchange. Workers at the Bank of Israel have also decided to take part. The banks' managements have not yet decided whether to seek injunctions from the courts that would force the unions to allow proper functioning.

The unions have called the strike to protest the Bachar Committee recommendations on banking reform, including forcing the banks to sell off their provident and mutual funds. "We have sat quietly until now, hoping representatives of the Finance Ministry and banks would enter talks on the structural changes the recommendations will necessitate at the banks," Bank Leumi union chief Louis Roth and Israel Discount Bank union chair Rikki Bachar said yesterday.

The two, who instigated the strike, said the action was initiated when the treasury started the legislative process for the Bachar reform.

The Histadrut claimed yesterday that the reform would make 4,000 jobs in the sector redundant. "Most of the workers in those positions will be dismissed. Very few will be transferred to other jobs as the banks are in the midst of cost-cutting and early retirement plans," the labor federation said.

The Association of Banks in Israel recently asked the union not to carry out its strike threat. Attorney Nahum Feinberg wrote to Histadrut banking sector leader Zion Shema, saying that the banks, which are themselves opposed to the reform, are not a party to the dispute.

Shema stated in response that although management at the banks opposes the recommendations, the Histadrut and the unions direct their struggle against them as well. "Our job is to ensure that no banking jobs are lost," he said.

When it rains, it pours

The union representing the First International Bank's managers and authorized signatories is escalating its fight against management: it has ordered its almost 700 members not to show up for work today. In parallel, the union will be convening its members.

Their absence will paralyze all actions requiring the permission of a manager or signatory at the bank, such as opening vaults, granting permission for transactions in securities, credit and deposits.

Union chief Yona Goldshlagger, accuses the management of failing to cooperate in efforts to end the protracted labor dispute, which the committee declared six months ago. Among the grounds for the strike was a demand for a bonus based on the bank's 2003 profits.

It isn't the only rumble at FIBI. Recently the clerical union headed by Hanoch Livne, representing 1,800 bank workers, declared a labor dispute over management's refusal to grant a month's salary as a bonus, after FIBI netted NIS 254 million in 2004.

The bank's management says the branches will be open as usual, and every effort will be made to provide customers with service as usual.