2,000 Layoffs on Tap in Israel Post’s Recovery Plan

Mail distribution would be reduced to two days a week from five, but post offices would work later into the evening.

Israel Post will dismiss 2,000 of its 7,500 employees as part of a recovery plan crafted by the government, management and labor.

The program was developed by the Finance Ministry in cooperation with management, the Histadrut labor federation, the Government Companies Authority and the Communications Ministry. It is expected to cost hundreds of millions of shekels to implement. Most funding for the plan is expected to come from the government because of the company’s hefty debt and shaky profits.

In the first nine months of the year, Israel Post made a net profit of 3.6 million shekels ($1.03 million), and the company had 144 million shekels in cash at the end of the third quarter. But within a year Israel Post must redeem 55 million shekels in debt and repay another 330 million shekels in the longer term.

Under the recovery plan, the company would have more flexibility in hiring and firing employees.

Also, mail distribution would be reduced to two days a week from five. The number of mailboxes would be cut as well. Both changes would reduce the manpower needed to collect mail.

In another element, the number of post offices would be cut, though post offices would operate longer into the evening to make it easier for working people to visit on weekdays. Currently, many Israelis only find time to get to the post office on Friday, the first day of the weekend in Israel. Lines that morning can be long.

A fourth major part of the efficiency plan is the automation of many services that have hitherto been done by employees behind the counter.

Israel Post: Will the government let it go bankrupt?Credit: Moran Maayan

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