Court Allows Rafa Labs Workers to Continue Strike Over IPO Impact

The Jerusalem Regional Labor Court has rejected a request by Rafa Laboratories to issue an injunction against a strike by the company's employees. The court ruled that there is no basis at this stage to restrict the workers' organizational actions, stating that the employees' claim that the company's transition from private to public ownership could affect their terms of employment and status is "worthy of being heard and examined."

The court found that the labor dispute does not appear artificial or merely an excuse to disrupt industrial peace, as the company had alleged. It accepted the employees' argument that negotiations were requested upon the release of the first draft prospectus. The court emphasized that the company's public offering is a significant change that could impact employees, justifying the examination of their demand for negotiations.

Furthermore, the court determined the strike to be proportionate and saw no evidence of bad faith by the employees or their union. It noted a long period of dialogue and negotiation, with the workers' representatives showing flexibility. The court referenced past rulings establishing an employer's duty to negotiate with employees regarding terms of employment, new collective agreements, or retirement conditions when a company is sold or undergoes significant changes.

The employees' representatives first demanded negotiations regarding the IPO's impact on their working conditions on May 24, 2026. The company received preliminary approval for the IPO on May 31. Following a period of tension and correspondence, the company went public on July 13, 2026, with 30% of its shares offered to the public. The employees held a one-day strike on August 3 and resumed their strike on September 9 after the management allegedly refused to negotiate.

"I hope that after the court's decision, which allowed us to continue striking, the management will finally understand that the employees are entitled to receive a bonus," said Dani Bonfil, Chairman of the Jerusalem Region. "The court sent a clear message today that employees have the right to fight for their future and their rights in light of the significant changes the company is undergoing. We call on the management to return to the negotiating table with an open heart and mind, in order to reach agreements that will ensure the employees also enjoy the fruits of the company's success," added Adv. Galit Adika, Secretary of the Professional Union in the Jerusalem Region of the Histadrut.