No Disciplinary Charges Over Ashdod Port Steak Scheme

The Civil Service Commission, which received the 'sirloin crisis' case about a year ago, reached its conclusions after consulting with the state prosecutor.

The Civil Service Commission is closing the case of restaurant vouchers given to workers at Ashdod Port and will not be filing any disciplinary charges in the perks scandal dubbed the “sirloin crisis.”

Finance Ministry officials have previously said the restaurant vouchers constituted millions of shekels of taxpayer money and that they were distributed contrary to proper procedure and without the relevant authority.

In addition, the vouchers were reportedly for restaurants chosen by port management − including the steak house Sinta, which means “sirloin” − without a public tender having been held for the port’s business.

The Civil Service Commission, which received the case about a year ago, said it reached its conclusions after consulting with the state prosecutor.

Under National Labor Court guidelines, the voucher practice is no longer in place but has been replaced by a cash incentive system that could actually cost more. NIS 5.2 million has been budgeted for the program this year.

As part of the investigation that led to the commission’s findings, staff at the Finance Ministry’s wage division collected witness statements from port employees, other treasury personnel and the staff of the Government Companies Authority.

Among those questioned was the head of personnel at the state-owned port, Ovadia Cohen, on suspicion that he had approved giving dockworkers the vouchers as a reward for meeting high production quotas, without the approval of the relevant government authorities. The port has issued a statement saying that Cohen had not been briefed on the case since January of last year.

Others questioned in the investigation included the head of corporate communications at the port, Igal Ben Zikri, as well as officials at the port finance division. The treasury sent its findings to the Civil Service Commission after completing its investigation.

The port management has said Finance Ministry officials were aware of the practice and had initially implicitly consented to it by their failure to object. Port officials said the reason for the implicit consent was that the incentive program yielded higher productivity. They said the practice was also in place at Haifa Port.

The Finance Ministry, which protested the voucher program two years ago, declined to comment for this report Monday.

The steak perk got its start five years ago, when the port’s management offered dockworkers a dinner for two at a number of restaurants in Ashdod, including Sinta, if they unloaded more than 250 ship containers in one shift.

At one point after the story broke, the port workers staged labor sanctions to keep the perk.

During its first year, the perk was not heavily used and it cost management the relatively small sum of NIS 613,000, but by 2010 the cost of the vouchers had ballooned to NIS 3.7 million.

Two years ago the port’s board was asked to approve the expense but asked for Finance Ministry approval instead because it was not provided for in the collective wage agreement with the workers. The Finance Ministry declined to approve the voucher program and protested the practice, prompting labor sanctions by the workers.

In a controversial ruling, the National Labor Court then urged the parties to work out a compromise, even though the practice had never received government approval.

The parties reached a settlement that dispensed with the restaurant vouchers and instead gave the workers cash incentives of up to NIS 7,400 per year per employee for high production levels.

This year the program is being budgeted at NIS 5.2 million, meaning that each employee could get up to NIS 620 in monthly bonuses − more than when the steak incentives were in place, at which point the program cost about NIS 500 to NIS 600 per worker.

Eliyahu Hershkovitz
Ilya Melnikov