Israel Chemicals Ltd. (NYSE: ICL; TASE: ICL) has invited 144 employees at its Bromine Compounds Ltd. unit for hearing prior to being fired, sources inform "Globes."
The decision to begin the hearings is part of Israel Chemicals comprehensive streamlining plan for its plants in southern Israel. The company's management recently explained that the streamlining plan is necessary in order to adapt Israel Chemical's scope of activities if the recommendations on royalties for natural resources by the Sheshinski II Committee are implemented.
Concerned about the layoffs, the members of the Bromine Compounds workers committee have hired the services of former accountant general Prof. Yaron Zelekha to conduct talks with Israel Chemicals management.
Israel Chemicals said in response, "The bromine compound factory has seen a continual erosion in profitability in recent years as a result of the crisis in the world bromine market including a fall in demand for flame retardants, slow growth and a fall in prices. At the same time, there are the Sheshinski conclusions obligating royalties on downstream products, and government decisions in recent years obligating Israel Chemicals to pay an additional NIS 1.5 billion in revenues each year on top of the NIS 1 billion already paid."
"All these create an urgent need to find a new balance for the company's Israel activities including adopting a streamlining plan, reducing production costs, and the overall work force. This plan is vital for the continued existence over the long term for the bromine factory and its employees. As part of the negotiations and talks with the workers committee over the past few months, the company announced this morning it plans ceasing employment of 144 workers. The management calls on the committee to conduct serious and honorable talks to reach agreement in implementing the streamline plan."
Last week after publishing its third quarter financials, Israel Chemicals CEO Stefan Borgas told "Reuters" that 600 employees would be fired to reduce the company's workforce by 10-12% in the coming years.
Published by Globes [online], Israel business news - www.globes-online.com - on November 16, 2014
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