An employer held a conversation with a veteran employee, during which it was explained that the employer wishes to remove the employee from his managerial position due to relevant considerations. It was agreed that the supervisor would consider future optional positions for the and that there would be a follow-up meeting within a few days. In addition, the supervisor clarified that if there is no suitable alternative, the parties may depart. A few days later another meeting took place in which the supervisor informed the employee that because no alternatives were found for his employment, it was decided to terminate his employment.
The National Labor Court held that the company was committed by virtue of the duty of good faith in the labor relations to maintain a genuine and honest process of seeking an alternative position for the employee. Although it is possible that at the end of the process it may become clear that there is no alternative but to dismiss the employee, in order to reach such conclusion, one should make a serious examination of the possibility of relevant employment alternatives within company. The appeal was accepted so that the company was ordered to pay compensation in respect of the unlawful dismissal in the amount of ILS 100,000.