SAP halts retirement plan and cancels collective agreement at Israeli operations
Negotiation gaps prompt reset in relations with workers’ union.
Software giant SAP is terminating its collective agreement with employees in Israel, Calcalist has learned from a letter the company sent to staff. According to estimates, no layoffs are expected in the coming months despite the move. SAP employs about 1,000 workers in Israel at its offices in Ra’anana and Tel Aviv.
The letter states:
“We would like to update you on the latest developments regarding the voluntary retirement plan and the next steps. After a thorough examination of the gaps remaining in the negotiations with the workers’ union, we have concluded that they cannot be bridged within the required timeframe. As a result, we have determined that the voluntary retirement plan will not be implemented.
“At the same time, the company has begun a formal process to terminate the existing collective agreements with the workers’ union, in accordance with the law and subject to a 60-day notice period, as stipulated in the agreement. During this period, the current agreements remain in full force and effect.
“In recent years, we have navigated significant challenges in Israel and globally, which carry important implications. This step is intended to enable the opening of negotiations on a new contractual framework that will respond to the company’s evolving business needs and allow for greater management flexibility.
“We understand that this is a significant development. This decision has been made with your best interests in mind. Our goal is to establish a framework that can be managed and implemented effectively, one that reflects the dynamic nature of the high-tech industry and allows the company to lead and succeed in a competitive market.”
In a separate statement, SAP said:
“In recent months, the company conducted intensive negotiations with the workers’ union regarding the voluntary retirement plan and the renewal of the collective agreements. During these discussions, significant gaps emerged that could not be bridged within the established framework and timelines. In light of this, it was decided not to advance the voluntary retirement plan at this stage.
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“At the same time, and in accordance with legal requirements and the agreements themselves, the company has initiated the formal process to terminate the existing collective agreements. This process will include a 60-day notice period, during which the agreements will remain fully in effect.
“The company believes the current agreements do not sufficiently address the evolving needs of the business or provide the managerial flexibility required in a competitive and dynamic environment. This step is intended to enable the creation of a new, updated, and balanced contractual framework that will support the stability of the Israeli site and the company’s ability to execute its business strategy, while continuing to operate responsibly and transparently.
“The company is prepared to reopen discussions to update the agreements so they better reflect both business needs and employee welfare, and expects the dialogue with the workers’ union to proceed in accordance with accepted principles for the benefit of both employees and the company.”
