Workers at Tnuva, Israel’s largest food manufacturer that was sold last week to a Chinese government-owned company, have launched labor sanctions. They are also threatening to toughen these sanctions if the management of Britain’s Apax Partners private equity fund — the owners that sold Tnuva to the Chinese — do not reach an agreement with the union on the size of the bonuses to be given employees in the wake of the 8.6 billion shekel ($2.3 billion) sale.
- Tepid welcome in Israel for Tnuva's new Chinese owner
- Controlling share of Tnuva sold to Chinese company
- Tnuva workers end labor slowdown after winning $39 million payout
On Tuesday the workers started disrupting the distribution of soft cheeses, with the support of the Histadrut labor federation, which had officially declared a labor dispute at Tnuva a few weeks ago.
The union is demanding that Tnuva pay employees a bonus after the sale, and also pay each employee six months’ wages. Apax is offering them a month-and-a-half to two months salary.
Workers plan to expand the disruptions to production lines and say they will not make do with preventing the marketing of products, following the breaking off of negotiations on Tuesday. For now the production of milk powder will continue, said the union. Employees held a protest Tuesday outside the company’s logistics center in Petah Tikva.
The union demanded that workers receive 3% of the total sale price, some 258 million shekels — which works out to half a year’s salary for each employee. Apax is offering 60 million shekels. The money would come out of Apax’s profits from the sale. Apax has made a profit of about 4 billion shekels on its investment in Tnuva.
The two sides did agree on two items being negotiated: Workers will not be fired because of the sale of Tnuva to Bright Food, and the present collective bargaining agreement will remain in effect at Tnuva. The collective bargaining agreement provides employees with job security for the middle- and long-term, as well as promotions at set times.
Tnuva said it is acting to minimize the damage caused by the labor sanctions.
The union said it has acted patiently so far and negotiated with what it described as British manners as is required for negotiations with a company registered in the British Virgin Islands, but went on to say that its patience has been interpreted by the company as weakness. “We have no choice but to carry on with the labor dispute,” the union stated.
Supermarkets preparing for shortages
Supermarket chains are preparing for the possibility they will be left without Tnuva’s traditional dairy products for the Shavuot holiday in the middle of next week. “For now Tnuva’s supplies are normal, but if they are threatening that there might be shortages ... in the next few months, I am preparing to give up on them. We are trying to check with Strauss, Tara and Gad what production capacity they can commit to,” said a senior executive in one of the big supermarket chains.
The executive also criticized the Tnuva union. “If the union does not stop its threats by [Wednesday] at the latest, they will pay a heavy price — at least as far as we are concerned.”
Eyal Ravid, owner of Victory supermarket chain, said he was told by Tnuva that the dairy company did not expect any holiday shortages, adding that he trusts the company to provide the goods. Ravid said he had not started to check with other dairies, since in any case no one else could cover Tnuva’s shortages.
A source at Tnuva said that while workers were still delivering and working, things were going slower than usual.