Israeli Businessman Must Pay Former Employee's Pension Deficit
Translated & summarized from Bizportal by baba
Reuven Nanikashvili, former owner of two now-bankrupt companies, must personally pay NIS 20,000 to a former employee for pension shortfalls. The Supreme Court upheld this ruling, rejecting Nanikashvili's appeal. The decision follows earlier rulings by the Regional and National Labor Courts, which found Nanikashvili abused corporate law to the detriment of employees. Nanikashvili also faces substantial legal costs across the proceedings.
The story in 5 lines · by baba
- Reuven Nanikashvili must personally pay NIS 20,000 to a former employee for pension shortfalls.
- The Supreme Court upheld the ruling, rejecting Nanikashvili's appeal against the National Labor Court.
- Nanikashvili previously abused corporate law to the detriment of employees, according to lower courts.
- The former owner of Dalton Aluminum Works and Dalton Planning and Execution Projects faces significant legal costs.
- Stanislav Admovich is the former employee who will receive the pension payment.
Reuven Nanikashvili, the former owner and manager of Dalton Aluminum Works and Dalton Planning and Execution Projects, companies now in receivership, has been ordered to personally pay NIS 20,000 to a former employee, Stanislav Admovich, due to shortfalls in his pension fund contributions. The final ruling came from Supreme Court Justice, who rejected Nanikashvili's appeal against a National Labor Court decision.
Nanikashvili was also ordered to pay NIS 16,500 in legal costs, an unusually high sum reflecting the courts' displeasure with his conduct. Previously, the Regional Labor Court in Haifa had ordered Nanikashvili to pay the principal sum and NIS 5,000 in costs, determining that he had abused the principle of separate legal entity for his companies to the detriment of his employees.
During the appeal at the National Labor Court, it was revealed that Menora-Mivtachim insurance company had transferred NIS 19,000 to Admovich's account. Nanikashvili did not respond to this information. The National Labor Court dismissed his appeal, stating that the piercing of the corporate veil by the regional court was legally sound. The court also noted that Menora had transferred the maximum legally permissible amount to Admovich, which was not the full sum he was owed for his work at Dalton, and related to a later period than Admovich's claim.
Nanikashvili was additionally ordered to pay NIS 10,000 in costs at the National Labor Court. He then appealed to the Supreme Court, alleging significant procedural flaws. Justice summarily dismissed this petition, ruling that it did not represent a rare case warranting Supreme Court intervention in a National Labor Court ruling. The Supreme Court Justice stated that Nanikashvili's arguments regarding the Menora transfer were essentially an appeal of the facts and did not justify Supreme Court involvement. He added that Nanikashvili had chosen not to address Menora's data and had only himself to blame. The Supreme Court Justice also rejected Nanikashvili's procedural claims, including the assertion that the National Labor Court was obligated to hold an in-person hearing on his request to cancel the ruling, finding no regulatory basis for this. Finally, the Supreme Court Justice noted that appellate courts generally do not intervene in cost rulings from lower courts. Nanikashvili was not required to pay costs for this specific Supreme Court petition as the ruling was issued without requiring a response. Justices Yael Willner and Ruth Ronen concurred with the Supreme Court Justice's decision.