Maariv Execs Facing Pay Cuts

Monthly wages will be limited to a maximum of NIS 22,500 for executives of the Israeli daily, while the company is under protection from its creditors,

Senior executives at Maariv will have their salaries cut significantly while the company is under protection by the court from its creditors. Monthly wages will be limited to a maximum of NIS 22,500.

For now, no workers will be fired, the paper's trustees Shlomo Nass and Yaron Arbel decided. They want to allow the new owner, whoever that may be, to make the decision about who to let go and who to keep on if a sale is made.

Some 60 to 80 employees will have their salaries cut, the court-appointed trustees estimate.

The reason for the wage cuts is not only to save the failing company money, since during the present month-long stay of proceedings, wages are paid out of the paper's slim accounts and workers have precedence over other creditors - but this amount is limited to NIS 22,500. Higher wages would have to come at the expense of other creditors in a future debt agreement. But in this case, the wages will be covered by the National Insurance Institute in the case of a company that goes bankrupt - but only up to this limit.

The highest paid employee at Maariv is CEO Tal Raz, whose wage costs are about NIS 2 million a year. Raz has resigned but is staying on to help the trustees in the sale of the paper.

Maariv filed for court protection a week ago after it ran up debts of over NIS 400 million, including debts of some NIS 95 million to employees. The stay of proceedings is in effect until October 23, when the Tel Aviv District Court will meet again on the matter.