Boaz Levy, CEO of IAI/IAI
A few weeks after taking office, the new Commissioner of Wages, Efi Malkin, sent a strong letter to the workers' union and IAI's management, in which he announced his intention to advance a collective hearing against the company's employees due to allegations of salary irregularities of thousands of employees. Among other things, promoting employees from various departments to the ranks of VPs and CEOs so that they will receive a pampering personal contract and a higher salary.
These claims first arose in 2019, and since then the Ministry of Finance has repeatedly granted IAI extensions designed to enable IAI to reach a comprehensive agreement with the union and move to a modern wage model that will enable competition for recruiting employees with high-tech.
What catapulted the treasury this time was the publication of the salaries of IAI's senior executives, including at least five who received more than $400,2022 in 2022. Not only is a hearing awaiting them, the payroll commissioner warned, but also a demand for the restitution of large sums from thousands of workers he claims were given illegally.
This hot issue, centered on undercompensation, which harms the ability to "hunt" high-tech refugees looking for work, has rolled over to Boaz Levy, IAI's CEO, who has served in his position since <>, and manages to bring him out of the spirit that accompanied him until the moment I mentioned the letter.
Arrow missile. Levy has a connection to the missile field since his days in the Air Force/IAI
"IAI is high-tech of the highest order," he asserts emphatically, so that those who did not internalize the message that the defense industries have become the spearhead of technology and driving the economy will now understand. "We have the greatest experts in the space and rocket market, experts who would earn huge salaries in the civilian market."
"Because we are a government company, which is subordinate to the payroll commissioner, he has the right to demand the return of funds, but we, the management, together with the workers' committee, claim that not only is there no problem here, there is interference in our salary considerations. Effie's assertion is wrong. You can't come and tell us, deal with the peak of high-tech, take the best workers, and pay them low wages.
"The salaries of IAI employees are low," he heats up, "and the load is great, and the time has come to deal with it once and for all. We are sitting with the Finance Ministry and the Defense Ministry and explaining to them the complexity of the matter and hoping that it will be resolved."
IAI employees receive generous bonuses. In May, grants totaling NIS 61 million were distributed to employees. In December alone, they received 90 million. Isn't that enough?
"We pay employees for their work according to a wage key and the collective agreement. We are a profitable company that transfers dividends to the state coffers and we are proud of that."
David Amsalem, the minister in charge of the Companies Authority, left the last dividend of NIS 20 million with him for the time being. He does not agree to transfer them to the state treasury.
"There is the defense minister and the minister Amsalem, and they are the ones who reach decisions. The company declared a dividend. In addition, there is another layer. From the earnings of the company it is customary to give bonuses.
In the years IAI didn't make a profit, they weren't distributed, so when there are profits, even the people who worked hard to reach them deserve, from production workers to senior managers. I understand the games of finance. But you have to take into account that this is a goal-focused and growing business company, and when you want the best, you have to pay. Working for national security worked on my generation. It doesn't work on the new generation."
You need to work on your slightly outdated image. High-tech has long understood that the face of the company is an important part of brand marketing.
"This is true for every field, not just high-tech. IAI invented the UAV, the world of satellites, naval missiles, and it has known ups and downs over the years. I think the breaking point in my image was the government's decision to cancel the Lavi project. The workforce was reduced at home from one to another.
Just then, the Start-Up Nation began, and the engineers who developed the next-generation fighter jet were ejected and started producing small products in the high-tech market. In other words, we have contributed quite a bit to turning Israel into a high-tech superpower.
"As a government industry, we can't compete with private high-tech, but we provide good salaries, technological challenges and a home for employees. There is a strong family widow here, with people working for 40 years in the same workplace. And Zionism is not a dirty word either, when you build complex projects for the sake of state security and at the end of the day you can't tell about them at home. In Corona, by the way, not a single employee was fired from us."
Why should we employ 15,000 people when everything is technology-oriented?
"A company that sells $5 billion a year needs 15,000 employees. We provide work for 50,000 households, also in the second and third circles."
The Ministry of Finance thinks that you can and must become more efficient.
"I have nowhere to cut back. We are in a big campaign to recruit more employees. Don't forget that we have a backlog of $17 billion for the next few years."
The Ministry of Defense, which is both your regulator and a large customer, owes you a billion shekels. Let's just say that this combination of regulator, customer and debt is problematic wherever you look at it.
"The Defense Ministry is also indebted to Elbit and Rafael. We look at this debt as the safest debt in the world. I know that I will receive it soon and that it is a priority for the Ministry of Defense."
Your salary was advertised as part of the company's salary publications, $370,000 a year, a relatively low salary compared to your private market counterparts. You could have made a lot of money in citizenship.
"I have been working at IAI for over 30 years and a large part of my motivation is my mission. I am from the generation that believes that security must be brought to the State of Israel. It doesn't exist only with me, but with many other employees. I have five more years in office, and when they are over, I will go and do something else good for the State of Israel."
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"I have been working at IAI for over 30 years and a large part of my motivation is my mission"/IAI
Scandal or festival?
In the past year, when high-tech found itself in a global crisis, and experienced an exodus of investors under the influence of the legal reform, and while waves of layoffs rocked the cruise ship of "Nadir Ackerman" and his hubris-stricken friends from the sketch series of "Wonderful Land", the defense industries opened burners and gave a tremendous leap forward, drawing into them reality-shocked high-tech refugees who were looking for job security and not just big money.
And Israel Aerospace Industries, in its full name, or IAI, in short, has a lot to offer high-tech professionals looking for professional challenges.
The most profitable government company in Israel, develops and manufactures aviation products, on land and at sea, space systems, defense and military systems, cyber and electronic products, including the Ofek satellites, Amos, radars, the Beresheet spacecraft, the Griffin laser bomb, loitering munitions, Barak 8, and twin-engine jets and fighter jets. Its main facility is located near Ben Gurion Airport, and its factories are scattered in eight other communities throughout the country.
Levy explains that anyone who enters IAI knows that he will not splash in a pool of bullets, but will at most step on a pile of empty backpacks that someone forgot in the warehouse. It doesn't promise streams of fresh ramen soup from the taps, but department trips and Purim activities. Everything, he said, is focused, specific and divided by age, because with all the goodwill, it's hard to organize one party for 15,000 employees together.
With all due respect to the impressive modesty, the company's 70th anniversary celebrations, held not long ago, cost millions, were held with the participation of Noa Kirel, Rita, Shlomi Shabbat, Itay Levy, Barry Sakharov, Miri Mesika and Eili Boatner, under the glittering guidance of Erez Tal and Bar Refaeli.
In other words: not really a comedy at sea or provincial karaoke with an amplifier. For those who wonder how logistics were conducted there, we will tell you that there were a total of three rounds of all this goodness, in Yarkon Park. When the workers go on their annual vacation, this time abroad, it will be by airlift, which would not shame a small country.
Apart from Levy and his management, the person who conducts this diverse and attractive activity, and takes care of the handsome reward, is Yair Katz, chairman of the workers' committee and son of the current Minister of Tourism, and former chairman of the committee, Haim Katz, who is considered one of the strongest committee heads in the economy, one who knows how to show the satisfaction of his muscular arm when necessary.
"I think a strong committee is healthy for society," Levy says. "He represents the workers but sees the good of the company. Therefore, in most cases we have uniformity of interests and sometimes disagreements. When there is trust, agreement and friendly understanding. My relationship with Yair is excellent."
Is there also no dispute about the protest against the legal reform? Are IAI employees allowed to demonstrate against it?
"There are no demonstrations at IAI. Our employees don't go out to protest together. Everyone leaves political opinions outside the fence."
Let's not get carried away. Your committee is affiliated with the Likud. Suffice it to recall the mass participation in the party and the organized transportation to the primaries.
"The transportation is an event from the past. There was an auditor's report and we implemented it. Society today is apolitical. Anyone who wants to demonstrate after work, or take half a day off for it, is free to do what they believe in. More importantly, at this point in time, and I don't know how to predict the future, there is no effect of the legal revolution or the protest on us. We work in a traditional industry, with needs that arise, as evidenced by our impressive backlog."
Air defense radar system manufactured by IAI / IAI
Half a child
Levy, 62, a married father of two and a graduate of aerospace engineering, worked in missiles during his service in the Israeli Air Force. As a young engineer, he joined the Arrow project, which was then in its infancy, at a time when the world did not know how to intercept missiles. Since they had no one to learn from, they sat down and wrote the textbook of "How to Intercept a Missile with a Missile," themselves. Over time, he rose through the Arrow's chain of command until he was appointed to head it.
"I led Arrow 3 from concept to product. On the professional level, I am very proud. Rocket engineers are tested with attention to detail, where a small mistake can lead to failure and the work is with technologies that were ahead of their time. Think of the wonder that you are selling a system, which is like your child, to a foreign country in order to protect its citizens."
The sale of the Arrow 3 system to Germany, for the fantastic sum of $3.4 billion, was closure for the man who accompanied it from its development to its sale. A kind of excitement that is hard to describe in words. When I ask if they're already working on Arrow 5, he smiles.
"In our world there is no state of calm. On the one hand, we maintain the systems used by customers, and on the other hand, we try to get at least one step ahead of the customers and predict where the threats will develop from. We must never be in the gap. If the Arrow 3 is being used by the IDF, money is already being invested in developing the Arrow 5 that will provide a response to the threats that will come. We have been operating this way for three decades and have succeeded in predicting future technological development and needs."
How will "Arrow 5" differ from "Arrow 3"?
"I can't share many things, but in the world we are in today, the next wars will be broader and will not be fought on the front line, but will combine front and home front, military and civilian. The solution we are trying to bring is versatile in the face of the scenarios. No one can say what the next war will look like, but it is clear that the systems will be more flexible.
"One of the capabilities is forecasting. We look at the world from space, air, sea and land, with tools, some autonomous and some not, that give decision makers the ability to make them optimally. The world of UAVs and planes is narrow to be connected to communications satellites, the ground and other entities that will enable intelligent conduct of the campaign.
"We are in the air, space and sea, and now we have entered the ground world strongly and we are leading the future of the ground army in the context of autonomous capabilities. When there is conflict, it is possible to bring to the front a variety of tools, drones, drones, and robots, which will travel on land to hold the territory, without the involvement of flesh-and-blood soldiers, and control them from afar. The soldiers will be protected and will not pull the trigger as they used to, but will give a set of instructions."
Is the era of the combat soldier over?
"It's not over, but its share will be significantly reduced. We prefer to send technological capabilities that will know how to make decisions on the ground and preserve human life."
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