Maariv Workers Take to Street to Demand Back Pay, Severance

CEO assures workers that rumors of layoffs are exaggerated

The protest by workers at the Maariv newspaper, which is due to be sold amid expected massive layoffs, reached a boiling point yesterday, with employees mounting a protest at the paper's Tel Aviv headquarters.

The demonstrators' ire was directed at Maariv's management and against controlling shareholder Nochi Dankner, whose Discount Investment Corp. acquired the paper last year. The workers, who were joined by leaders of the social justice protest movement, including Daphni Leef and Stav Shaffir, were protesting the fact that they had received just a third of their August paychecks.

Of the roughly 2,000 employees at the paper, according to initial understandings, only about 300 or 400 are expected to be retained by the paper's new owner, Shlomo Ben-Zvi, whose Hirsch Media already publishes the right-leaning nationalist daily Makor Rishon. Maariv Holdings' CEO Tal Raz denied, however, that such massive dismissals would be permitted.

The total extent of the newspaper's obligation to its employees, according to a draft request for a stay of proceedings that was never filed in court, is about NIS 90 million. "At this stage, we are demonstrating, and want the owner of the newspaper to take care of the workers and pay them their full salaries and their [severance] pay," the head of the Maariv workers' committee, Haggai Matar said. "The protests here are a way for the workers to express their rage at the things that were done at Maariv and the fact that the owner is not taking care of the workers' funds." (See adjacent box )

The employees burned tires opposite the paper's headquarters and blocked traffic near the building. Some managed to get up to the second floor, where the offices of the paper's administration are located, shouting condemnations of the management and of Dankner. One protester threatened to break into cash registers at Super-Sol, the supermarket chain that is also part of Dankner's IDB group, if Maariv's employees did not receive their pay in full within 24 hours.

After tempers calmed a bit, Maariv Holdings' Raz came down to talk to the employees, saying that the terms for the sale to Ben-Zvi are still under discussion. There is no chance, he said, that 2,000 employees would be dismissed and that the new owner would retain only 300 or 400 workers.

"Maariv's management and Nochi Dankner are making every effort to preserve [Maariv] as an ongoing business," Raz insisted. "I understand why you are demonstrating and I identify with you and am trying to help. You need to give us the time to do things quietly." When the workers then began shouting at Raz, he left the scene.

There were those in the media industry who cast doubt yesterday on whether the sale to Ben-Zvi would even come to fruition. If it does, it was suggested that the financial figures in the initial understanding would be changed. The deal does not make financial sense in a number of respects, said one senior industry executive.

Maariv's owners have two sources of funds to meet the paper's obligations to its banks and employees: the sale of the land where the paper's printing plant in Bat Yam is located (and which is not to be sold to Ben-Zvi ) and the sale proceeds from Ben-Zvi himself. The Bat Yam property sale is expected to generate at least NIS 72 million. According to the initial understandings between the parties, the sale of the newspaper, if it goes forward, is expected to generate NIS 85 million.

The new owner, however, would not be assuming Maariv's liabilities. In addition, the sale proceeds would not be paid in one lump sum, and the balance after an initial payment would be subject to the paper's meeting certain business targets. Thus, even taking these two sources of funds into account, the expectation is that the current owners of Maariv would still be left with a shortfall of tens of millions of shekels.

According to the initial understanding thrashed out with Ben-Zvi last Friday, Maariv would immediately dismiss its editorial and administrative staff. After the sale, Ben-Zvi would offer 300 to 400 of them a job, under a new Maariv entity. Their employment terms would be renegotiated. The roughly 1,200 printing and distribution employees would be retained in the near term as employees of the current Maariv firm, but only until the printing plant is sold.