A new employment agreement between the employees and the management was signed at Discount Bank. In an announcement to the stock exchange, the bank provided the details of the agreement: The first section stipulates that the validity of the Labor Constitution has been extended until December 31, 2026, subject to changes, the main of which is the conversion of workers from “temporary” status to “stable employee” status. By the Bank in accordance with the provisions of the law.
The number of stable employees shall not exceed 2,000 at any given time within a period of ten years from the date of signing the agreements. The bank undertook to convert 300 employees to “full-time” status by the end of this period.
In addition, additional changes to the labor constitution were agreed upon, including the employment of department managers in personal contracts and improved mechanisms for mobilizing employees. “In addition, the transfer of employees of the Bank’s headquarters and other relevant units to the Discount Campus was arranged.
Another clause in the agreement concerns the transition to remote work, and arrangements were made for remote work one day a week. Another key layer is the salary and grants for the years 2024-2022. The agreement stipulates that the bank will pay employees a shekel and differential wage increase, according to the following model: For employees at the clerical level, starting from the July 2023 salary, an average monthly wage increase of NIS 1,350 gross per employee for the years 2024-2022. For employees at the managerial level, a wage increase will be paid at an average rate of 3% per employee and no more than a total cost of NIS 10 million per year for all employees, for each of the years 2024-2022. For employees in “stable” status, a wage increase will be paid at an average rate of 2.66% per employee, for each of the years 2024-2022, and at a total cumulative rate of no more than 8% for the entire period.
In addition, employees will receive a “conditional return bonus”. The Bank will pay employees for each of the years 2024-2022, an annual bonus conditional on the amount of the annual return on capital. The bonus levels have been adjusted to improve the Bank’s performance in such a way that compared to the previous wage agreement, a higher return will be required at each bonus level.
Thus, for example, at a return of 10% one salary will be paid less compared to the previous wage agreement and in order to receive a maximum bonus a return of 14% or more is required.
Beyond that, employees will also receive one-time grants, including consent to move to campus and grants for changes in the bank’s labor constitution. Employees at the managerial level will be paid a one-time grant depending on the return on capital that will be paid subject to an annual return of 10% in the year prior to the year of payment and a total cost not to exceed NIS 8 million. Branch employees will also receive a total bonus of NIS 10 million.
The Bank’s management estimates that the agreements will not have a material effect on the Bank’s profits in 2022.