The planned wage cuts are in addition to the 170 layoffs by the company.
The "Yediot Ahronot" daily reports that Migdal Ha'emek-based Tower Semiconductor (Nasdaq: TSEM) is about to cut its employees' wages by 6-13%. Tower Semiconductor, controlled by the Israel Corporation, will cut salaries by 6% for junior employees and 13% for senior employees, who constitute 30% of the company payroll. The company's decision was prompted by the global semiconductor crisis, which is affecting the Israeli integrated circuit manufacturer.
The planned wage cuts are in addition to the 170 layoffs in the company. Sources report that Tower Semiconductor notified the Ministry of Industry and Trade that it would suspend its planned layoffs if the Ministry of Labor and Social Affairs agreed to finance the cost of employing half the employees scheduled to be laid off.
The Ministry of Industry and Trade believes that Tower Semiconductor would suspend its layoffs in return for the release of its NIS 6.5 million grant. The grant has been held up until now because the plant did not meet its target of employing 1,100 people. The Ministry of Industry and Trade director general will meet with Tower Semiconductor in the coming days in an attempt to find a solution for releasing the grant.
Published by Israel's Business Arena on October 30, 2001