The labor dispute at Israel Discount Bank (TASE: DSCT) is over, after almost a year, after the union reached a deal with the bank's new CEO, Lilach Asher-Topilsky that met most of the union's demands.
The bank's employees will receive a 3.25% pay hike, and a 0.25% hike retroactive to 2011, and a 1% advance on 2014 salaries. The union originally sought a 3.75% pay hike, while management demanded a 1-1.5% hike only for employees earning less than NIS 18,000 a month.
The new salary agreement is not good for Discount Bank, to put it mildly. The bank had sought to improve its poor efficiency ratio, but on the other hand the demand for a 5% pay hike is now off the table. Asher-Topilsky had little choice. She took up the post just a month ago, and with so much to do, ending the labor dispute was necessary to deal with everything else. The bank's workers committee exploited this to win almost everything it wanted.
Asher-Topilsky has bought time. With negotiations on a new salary agreement set to begin in 2015 and the sensitive issue of employee transfers pushed back to 2016, she can consolidate her position, streamline operations, and enter new talks in a stronger position.
Published by Globes [online], Israel business news - www.globes-online.com - on March 30, 2014
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