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The National Labor Court began deliberations last night on a request from the Banks Association to issue a restraining order against the Histadrut labor federation and workers committees, forbidding them from launching a bank strike today.

Some 40,000 striking employees are set to close down all 1,000 bank branches in Israel. Automated teller machines won't be refilled with cash, and phone and online banking services won't be available. The bank strike will also automatically paralyze trade on the securities stock exchange.

However, the Finance Ministry believes the strike will be short-lived, lasting as little as a day or two.

Workers committees decided on the strike to protest the bank reforms recommended by the commission headed by treasury director general Joseph Bachar.

The proposed reform would remove provident and mutual funds from the banks and transfer them to insurance companies and brokers, to increase competition. Workers committees said the reform would lead to 4,000 layoffs, or 10 percent of all banking employees.

A bill incorporating the Bachar recommendations goes before the Knesset for its first reading next month.

In the event workers are allowed to strike, all banks will be closed today and Internet service will not operate.

In addition, workers will not refill automated cash machines. There will be no trading on the Tel Aviv Stock Exchange.

In petitioning the court, the Banks Association argued that the strike decision was not made in good faith.

"The banks themselves object to implementing the Bachar report, so they are not the address for the dispute declared by the Histadrut," the petition to the court said.

The petitioners further claimed that a strike would cost the banking system some billion shekels and disrupt the entire market.

In its response, the Histadrut and workers committees argued that the strike was called because the bank managements and treasury officials were unresponsive to workers' requests to enter into negotiations with them over the terms of implementing the reform and its ramifications for their employment.

The treasury rejected on the weekend a request from the head of the Banks Association to begin negotiations with the workers committees to forestall a strike. Bachar made clear in his reply that the treasury has sovereignty over the matter of opening up the money market to competition, and that any ramifications of the reform on employees are the responsibility of bank managements.