Teva to lay off 300-350 in Israel

Yitzhak Peterburg Photo: PR

The pharmaceutical company has said it is beginning talks with the Histadrut about layoffs at the Kfar Saba and Ramat Hovav plants. the Histadrut called a work dispute.

Teva Pharmaceutical Industries Ltd. (NYSE: TEVA; TASE: TEVA) today announced the implementation of another stage in its restructuring and business focus in Israel aimed at bolstering the competitiveness of its sites in the country, while consolidating their standing and importance in the future.

The company is consequently beginning consultation with the Histadrut (General Federation of Labor in Israel) and the workers' committees of the Kfar Saba and Teva Tech (Ramat Hovav) sites, with a view to terminating the employment of managers and employees at these two sites in the coming months.

In the wake of Teva's announcement, the Histadrut called a work dispute, which will permit employees to strike in 14 days time.

Teva currently has 7,000 employees in Israel distributed among the company's sites from the north to the Negev. An estimated 300-350 workers will be laid off.

Histradrut spokesman Yaniv Levy said in response, "We will not accept any unilateral measure in which workers are laid off at Teva. We expect the company's management to act responsibly, and not to involve Teva's plants in Israel in a series of conflicts that will escalate labor relations."

Teva said, "In view of the difficult business situation facing the entire pharma industry, including Teva, Teva has been implementing a global restructuring and business focus plan throughout the company in recent years. Large parts of this plan have already been completed in most of the countries in which Teva operates.

"Before turning to this part of the plan, Teva went ahead with a large number of restructuring and business focus measures in Israel. Among other things, greater focus was put on complicated products with a high technological threshold in which sites in Israel have a competitive advantage over production sites in other markets. Teva is adopting new technologies in Israel in areas such as inhalers, sterile and biological products. The company has made major investments in infrastructure, so that its sites in Israel can be a significant part of production of its future flagship products, especially migraine and central nervous system products. Excellent operational methodologies for improving productivity have been successfully assimilated at all Teva's sites in Israel in order to enhance their competitiveness. Functions have been consolidated and duplications have been reduced - especially in the company headquarters in Petah Tikva, including at the management level. The company has offered attractive voluntary retirement programs at a number of its sites in Israel."

Teva added, "The process is being conducted in open and transparent consultation with the Histadrut and the workers' committees. Teva is implementing this difficult process with all due gravity, while taking care to exercise maximum sensitivity, and with constant attention from the company's managers, who are maintaining an open channel with every employee in order to ensure a fair and respectful process.

"As part of its ongoing commitment to its employees and understanding of the challenge of finding an alternative employment framework, especially in southern Israel, Teva will offer the employees whose employment is being terminated packages and terms that are among the best in the economy. In addition, they will be given personal guidance, including advice during the process of terminating their employment, workshops, and professional training, in addition to placement services that will help them find suitable alternatives, with the goal of creating employment continuity."

"Israel, and especially the Negev, is important to Teva, and our activity here will continue to be a significant element for the company in the future. At the same time, we are committed to doing everything necessary to ensure that our sites in Israel are competitive, efficient, and have a sustainable business horizon. Teva will continue investing in Israel, including in its production sites, in activities that reinforce our competitive ability at the global level," Teva acting president and CEO Yitzhak Peterburg said.

"Teva's largest production center is located in Israel, and is responsible for the production of the company's present and future strategic products. In recent years, we have invested a great deal in positioning the Kfar Saba site as one of the company's significant launching sites, at which 350 launchings are planned in the next five years. We will also continue investing in infrastructure, development and accumulating the know-how we need for production in Teva's future core business spheres. The Teva Tech site will continue to be one of the most excellent of all our chemical plants in the world for the production of active ingredients," added Teva senior VP Israel operations David Lustig.

Published by Globes [online], Israel Business News - www.globes-online.com - on July 23, 2017

© Copyright of Globes Publisher Itonut (1983) Ltd. 2017

Yitzhak Peterburg Photo: PR
Yitzhak Peterburg Photo: PR
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