Daily Roundup Israelis Should Pony Up Taxes and Not Take Lunch

Stanley Fischer finally comments on government's huge deficit; more employers deducting lunch breaks from pay; Cellcom settles class-action suit.

Ruth Schuster
Ruth Schuster
Ruth Schuster
Ruth Schuster

Cellcom settles class action: Mobile operator Cellcom will pay NIS 3.8 million to consumers who didn't surf the Web but were charged for it anyway. The consumers in question had bought third-generation smartphones from Cellcom, but didn't use them to go online. The lead plaintiff was a company called Razgal Energy, which complained that the company's contract explicitly stated that the client agreed to pay for surfing and could not cease paying for it. Cellcom had argued that 3G services couldn't be used without use of the 3G network, and the cost of using the 3G network was covered by the surfing package. In fact the surfing package should better be called the "3G services package," the company claimed. Even so, it settled; the plaintiff settled for half the damages it demanded.

Israelis should pay more tax, says Bank of Israel: For the first time, the governor of the Bank of Israel, Stanley Fischer, commented yesterday on the huge deficit the government is likely to run in the next and those to follow. His solution, beyond austerity: Israelis should pony up more tax. Darkly warning of the dangers of heavy deficits, Fischer obliquely criticized the Netanyahu government's economic policies. While predicting that the deficit will spiral up in 2013, Fischer sees overspending by a huge NIS 22 billion in 2014 and NIS 25 billion in 2005. Note that Israel's entire budget for the year is about NIS 350 billion, give or take a few.

No pay for eating: In another sign of the times, Israeli employers are increasingly deducting time spent indulging in lunch from pay. The law states that workers are entitled to a half-hour break if they work six hours or more – but it doesn't say the company has to pay them for that time. A survey of 240 companies in five industries (food, metalworking, commerce and services, high-tech and finance), compared pay slips last month to December 2011 and found a 25% increase in the practice, from 12% of companies last year to 15% this year. "Deducting meal times is legal but nasty," commented Arie Avitan, a labor lawyer. "Among temp workers it's the nastiest of all. They lose about 5% of their monthly pay." He also says that if an employer suddenly starts deducting lunch breaks from the daily shift, it constitutes impairment of employment terms and is illegal.

Israelis prepared to earn less: Speaking of austerity, Israel's social-security network, the National Insurance Institute, looked and found that most unemployed Israelis don't wait until their benefits expire before accepting a job. It also found that they're willing to accept lower pay than in the past: The study from 2003 to 2011 found that some 50% of benefits receivers preferred to compromise on salary than stay in the ranks of unemployed.

Post office smacked over ageism: Meanwhile, the Ministry of Industry, Trade and Labor ordered Israel Post to revoke an agreement reached to lay off 50 workers, because it smacked of discrimination - all were aged 50 and up and nowhere did the agreement mention how the workers were functioning. That is patently illegal, the ministry pointed out. The post office rebutted that it has to pare down costs and denies ageism: The people chosen had "accrued their full pension rights" and any other worker it chose to fire would have suffered worse damage. The postal workers' union mumbled that the agreement had been approved by "all relevant bodies."

Watchdog claims Profit assets lower than stated: Just as Profit Building Industries is gearing up to close a debt arrangement, the Israel Securities Authority has upped and claimed the real value of the company's assets is lower than it states. The watchdog wrote a letter to Profit management, claiming property it owns in Poland is worth less than the stated NIS 95 million. Profit denies any such thing. The dispute is over capitalization interest rates on the assets and writedowns the ISA thinks Profit should have carried out. A majority of the company's bondholders, who are owed NIS 260 million, have already approved the draft debt arrangement: Much of the existing debt will be switched for longer debt.

Former minister joins Discount Investment board: Danny Naveh, briefly the health minister in a Likud government and for years a treasury official, is joining the board at Discount Investment Corp, a second-tier company in the pyramidal IDB group. Naveh left politics six years ago, since which time he's been engaged in investments. He is presently founder and partner of Agate Medical Investments; one of its biggest backers is Clal Industries, sister company of Discount Investment.

Why Greenstone stock jumped on Wednesday: Greenstone stock shot up 13% on Wednesday, on heavy turnover for it of NIS 1.5 million, because of an announcement that Leader Holdings is in negotiations to sell the controlling interest in the company. Greenstone didn't state who the potential buyer may be. But it turns out the putative purchaser is Ultra Shape, the body-contouring technology company bought by businessman Yaron Yenni, who has a yen for shell companies. The attraction in Greenstone is its fat kitty, said a source near Yenni, adding that no decisions have been made on what they might do with Greenstone if they do buy it.

With reporting by Meirav Arlosoroff, Haim Bior, Hila Raz and Yasmin Gueta

For Israelis, take a lunch break is no longer a picnic.Credit: Yael Tzur
Bank of Israel Governor Stanley Fischer.Credit: Tomer Appelbaum

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