Agreement on Mandatory Pensions Near

Employers and the Histadrut labor federation will sign an agreement within days on the implementation of mandatory pension plans, the chairman of the Federation of Chambers of Commerce, Shraga Brosh, told the Finance Committee on Wednesday as it debated a government-sponsored bill on the issue. Brosh said the sides are preparing the final points.

Brosh and Histadrut Chairman Ofer Eini, however, declined to elaborate on the details of the agreement in front of the MKs. Eini said the treasury's proposal constitutes a threat to employers and the Histadrut. According to the proposal, if no agreement is reached by 2010, the finance minister could intervene and dictate the terms for pension savings.

Committee head MK Stas Misezhnikov (Yisrael Beiteinu) asked Brosh and Eini to present a draft of the agreement before signing. Nir Cohen, the deputy supervisor of capital markets at the Finance Ministry, said the proposed bill is a legal framework which employees and the Histadrut will have to fill out.

Cohen noted that the bill seeks to create a legislative norm for providing pensions to workers. The employers and the Histadrut will try to make pension arrangements voluntary and part of an employment contract or collective bargaining agreement; the government will intervene when employees are unable to reach an agreement with employers.

Eti Aflalo adds:

A number of chief financial officers at large companies came out against the banks providing pension advice to employees. At a CFO conference this week in Eilat, the finance chiefs of El Al and The Central Bottling Company (Coca Cola) said the banks will act in their own interests and not those of the workers.

The solution according to Nissim Malki, El Al's CFO, is to provide objective pension advice at the company's expense. He said the airline has already hired a consultant who recommends individual pension plans for employees.

The Israel Electric Corporation plans to provide the same service for its 13,000 employees.