TEL AVIV, Israel, March 20, 2023 /PRNewswire/ -- Yesterday (March 19) the management of Bank Leumi (TASE:LUMI) and the Leumi workers' committee announced that, following successful negotiations, an innovative and up-to-date collective agreement was signed, adapted to the era of high-tech banking. The agreement will serve as the basis for employment at the Bank in the coming years. The agreement – which was approved by the Bank's board of directors and by the workers' committee – focused on guaranteeing employees' social benefits, while providing greater managerial flexibility to the Bank, in order to ensure that the Bank's operational model is adapted to the changes prevailing in the banking sector. Among other things, the agreement provides for a higher quota of employees whom the Bank may employ under its technology agreement, so as to enable the Bank to make yet another leap forward in digital transformation, according to its strategy.
It was also agreed that, in order to boost the Bank's managerial flexibility – against the backdrop of a changing banking market – the Bank will be able to employ people under the collective agreement, without granting tenure, for a period of up to 10 years, in a gradual manner, according to the employee's seniority, with no more than 6 additional years.
The agreement establishes an orderly mechanism of periodic pay raises for employees in the coming years, the rate of which is based on the Bank's return on equity, so as to enable all employees to continue to achieve high returns, which will be distributed differentially according to each employee's performance in order to encourage excellence and performance-based compensation. In addition, in order to ensure that employees are dedicated to achieving the work targets every single year, at the beginning of each year, management will publish the targets according to which the bonus will be paid, based on the annual results. The target return for a full bonus in respect of 2023 is 17%.
The agreement also includes improved related and social benefits for various groups of employees at the bank.
Leumi has enormous respect for organized labor and cherishes the need to preserve and strengthen workers' rights. It is a win-win agreement for all parties and reflects the Bank's successes, Leumi's leadership in the financial sector and the shared quality and commitment.
CEO of Leumi, Hanan Friedman: "The successful agreement we reached in collaboration with the workers' committee will allow us to continue to strengthen Leumi's position at the forefront of Israel's financial system. We have worked hard to both allow us to take good care for the future of our dedicated employees – in a variety of aspects, as well as to allow the Bank maximum managerial flexibility in order to enable the Bank's continued growth, in view of the changing reality and the many challenges we still face. I thank all those involved in reaching this important agreement – the Bank's management and the workers' committee – and believe that today we are embarking on a path that will allow us to achieve the many goals we have set for ourselves."
Heads of the workers' committee, Ron Levy and Roy Kenneth: "The new labor agreement strengthens organized work and is good news for Leumi's employees, the high-quality, dedicated force that drives the Bank, and no less importantly for Bank Leumi – the workplace that is also our home. We believe that the outline we have reached in fruitful collaboration with management will allow us to work together with Leumi to meet the business challenges and strengthen its position as Israel's leading bank."
For more information visit the investor relations page on our website or contact Michael Klahr, VP, Head of Investor Relations, at investorrelations@bankleumi.co.il
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SOURCE Bank Leumi
