Osem CEO Gazi Kaplan
Photo: Sivan Farag
Osem to freeze top management salaries
Food manufacturer's CEO Gazi Kaplan discusses wage scheme he exposed at Calcalist conference: One-year top management raise freeze for benefit of company workers who earn below average wages
"When I hear about a young couple with two kids that can't make ends meet even in the periphery, it's clear to me that the social protest
is justified and that we must find ways to increase the middle class's disposable income – the Trajtenberg Committee and the business sector should be charged with this responsibility," Osem CEO Gazi Kaplan says in an interview to Calcalist.
Kaplan intends to suspend the index-linked annual wage increase not only for the company's top execs but also for senior management, which earn tens of thousands of shekels a month and redistribute the money to employees earning below average.
However, Kaplan does not intend to wait neither for committees nor for the prime minister – in the upcoming months he plans to put on Osem's board's table a salary redistribution scheme to increase the wages of Osem employees who earn less than the average salary in Israel's economy. Kaplan calls upon his fellow CEOs to join him.
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Kaplan explained to Calcalist that the plan aims to find an equilibrium that will allow a different distribution of pay to aid the company employees who earn below average – mostly from the production array. Kaplan unveiled his initiative at the Calcalist central economic conference held last week.
He said many elements in Osem already approve of the initiative, but it still has to get through the company's board.
Kaplan is not concerned about executives who might object to the freeze and jump ship for competitors. He explained to Calcalist that Osem pays lower salaries than competitors relatively to its ranking on TA 100 and the TA 50 index and still is considered an attractive company to work for.
"I think that paying salaries in the tens of thousands of shekels is inappropriate and one shouldn't be glutinous," said Kaplan.
Additionally, Kaplan explains that the scheme is also a litmus paper test for the company's management and as far as he is concerned – managers who are unwilling to make concessions to support weaker employees have no place in the company.
As for solutions for the middle class crunch, Kaplan told Calcalist that he believes that the Trajtenberg Committee's recommendation should follow the same line.
"In order to address the middle class crunch, the government should allocate budgetary sources which can only be done through increasing progressive taxes and cutting regressive taxes alongside slashing the defense budget."
Kaplan suggests adding another tax bracket, decreasing indirect taxes and hiking capital gains taxes. "The underlying question is how to redistribute income and increase the middles class's disposable income."
Nonetheless, Osem's chief has reservations as regards to raising corporation taxes: "We must maintain a perfect market and offer incentives for foreign Investments."
Click here to read this report in Hebrew
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