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El Al Shareholders Vote to Place Airline in Voluntary Liquidation

El Al shareholders voted at a special meeting yesterday to place Israel’s national airline in voluntary liquidation. The decision followed a round-the-clock labor-management negotiating session at which all of the workers groups, except the pilots, agreed to strict measures laid down by management to cut losses and keep the planes flying.

The pilots balked at a management demand to work a 16-hour day which they said would compromise passenger safety and was in violation of international safety regulations.

It was not immediately clear whether the government, which holds 98 percent of the airline’s stock, would accept the liquidation plan recommended by the shareholders. The latter are all government proxies, except for representatives of the Zim Lines, Israel’s national shipping company, and the Jewish Agency which own two percent of the stock between them.

Most Cabinet ministers questioned after the vote was announced indicated they would favor re-organization of the airline under the guidance of a court-appointed receiver. General sentiment seemed to be against the sale of El Al assets to private interests.

The company was established in 1948, shortly after Israel’s independence and has always been regarded as a major asset to the nation in economic, political and defense terms. But El Al has been a heavy money-loser for years, partly due to intermittent labor strife. It was grounded by management more than two months ago following a job action by flight attendants.

Management proposed harsh terms to avoid liquidation. It demanded sole authority over hirings and firings, job assignments and operations with virtually no input by employes in the decision-making process. The workers agreed, during the 11th hour negotiations, to accept wage and salary reductions, longer working hours and fewer paid holidays and fringe benefits.

But the pilots union held out against the demand that pilots work up to 16 hours in the cockpit. They maintained that the longer hours would jeopardize aircraft safety and were justified only in emergencies or when a flight was prolonged by bad weather. They also said that international regulations forbade them from accepting such conditions.

Histadrut, which negotiated on behalf of most of the workers committees, expressed regret over what it called the “hasty action” of the shareholders to recommend liquidation after most employes accepted management terms.

A spokesman for the workers committees charged the shareholders with “political motivations.” He said they acted because the government had surrendered to demands by the Aguda Israel Party to end El Al flights on the Sabbath and religious holidays, making El Al the world’s only international “five-day airline” and adding considerably to its revenue losses.

The shareholders meeting was held under tight security. Hundreds of police and border police in riot gear and helmets, wielding batons, surrounded the El Al office and workshops at Ben Gurion Airport. They padlocked the doors and barred entry of all personnel.

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