Bank Hapoalim Faces Major Layoffs Amid Labor Disputes and Efficiency Drive
Bank Hapoalim, under CEO Eli Cohen and controlled by Tzadik Bino, is undergoing significant internal turmoil as nearly 60 mid-level managers and authorized signatories are expected to take early retirement between the end of this month and year-end. This move is part of a broader plan by the bank's management to reduce managerial staff by an additional 15%, amounting to dozens more positions cut in the coming months. This downsizing aligns with a wider trend in Israel's banking sector, where major banks are gradually reducing their workforce despite strong profits and continuous dividend payouts.
The bank's market value stands at 23 billion shekels, with its stock declining over 5% since the start of the year and underperforming compared to other major banks. Efficiency ratios remain among the weakest in the top five banks, prompting management to push for cost savings and a restructuring plan targeting managers and signatories. The affected employees are unionized under Dekel Keritz, representing about 650 members, down from 950 previously. To circumvent traditional collective agreements, management has introduced "clerks with authorities," allowing certain clerks to assume managerial roles with easier mobility and lower salaries, a move that risks conflict with the Histadrut labor federation.
Simultaneously, a labor dispute has erupted among the bank's technology workers (Metaf union), who recently initiated organizational measures after negotiations stalled. The dispute centers on management's demand to reduce remote work and increase branch presence, despite alternative proposals from the union. Reports indicate that some managers are being pressured into early retirement through reassignment to distant locations without formal hearings.
Despite these tensions, Bank Hapoalim reported strong financial results, including a 13.2% return on equity in Q1 2024 and a net profit of 480 million shekels. Customer assets grew 25% to 1.2 trillion shekels, maintaining the bank's leadership in capital markets. However, management bonuses have increased significantly, with senior executives receiving up to five months' worth of bonuses for 2025, while mid-level managers and signatories received minimal bonuses without union negotiation.
The labor unrest at Bank Hapoalim mirrors ongoing conflicts at other major Israeli banks, including Bank Discount and Bank Leumi, where similar disputes and restructuring efforts are underway. The bank's management insists the early retirement program is voluntary and offers favorable terms, denying claims of unfair treatment or service degradation. Union representatives warn that if negotiations fail, they may seek legal recourse to protect members' rights.
