El Al begins 1,600 layoffs

El Al  / Photo: Yoav Yaari
El Al / Photo: Yoav Yaari

The streamlining is a condition of the airline receiving $300 million in bank loans with an 82.5% state guarantee.

El Al Israel Airlines Ltd. (TASE: ELAL) has begun the process of summoning for hearings the first of 1,600 employees who are due to be laid off as part of the company's streamlining plan. El Al is in talks for a $300 million loan from Bank Leumi (TASE: LUMI), Israel Discount Bank (TASE: DSCT) and other financial institutions with an 82.5% state guarantee, as part of the government's rescue plan.

One of the conditions of the rescue plan is the reduction in the work force. The 1,600 employees to be laid off include both temporary and permanent staff although the agreements between management and the workers committees stipulates that the layoffs will only begin once the loan agreements go into effect.

El Al Workers Committee chairman Sharon Ben-Yitzhak said that the employees who will be laid off will be given beneficial retirement terms according to age and seniority.

Employees from all the airline's sectors will be laid off. El Al will shed 71 of 638 pilots in addition to 32 pilots who were let go last year and 40 pilots who voluntarily quit - for a total of nearly 150 pilots leaving.

El Al recently announced that it was extending unpaid leave for 5,245 of its employees until March 31.

Published by Globes, Israel business news - en.globes.co.il - on February 23, 2021

© Copyright of Globes Publisher Itonut (1983) Ltd. 2021

El Al  / Photo: Yoav Yaari
El Al / Photo: Yoav Yaari
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