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A strike by 450 employees at Tadiran Communications is costing the company tens of millions of shekels in damages, according to the company's labor union.

Union member Morris Hanuna said that most of the damage has been caused by the company's inability to fill orders for military communications equipment for clients in South America and the United States.

Workers held a violent demonstration yesterday near a building in the Lod industrial area, where the company recently rented offices in an apparent effort to bypass the strike.

Striking production line workers are preventing goods from being taken out of the company's production facilities in Holon as well as preventing the entry of suppliers, customers and managers into the factory.

The decision to strike came after, according to the union, management reneged on an agreement over wage hikes and pension guarantees.

The union said that despite the fact that the last collective bargaining agreement ended in July, management is refusing to negotiate over a new one.

The union also is demanding that the company put up guarantees worth NIS 60 million to ensure early pension payments for any of the employees who opt to take the proffered early retirement packages included in the impending merger between Tadiran Communications and Elbit.

The strike, now in its third week, has the support of both the Histadrut Labor Federation, which has promised to pay workers' salaries, and the Tel Aviv District Labor Court.

Tadiran's management said it does not discuss employee relations.