LABOR BOARD HAS 'LIFTED THE VEIL' OVER P.I OFFICE: ORDERED OWNERS FOR SEVERANCE PAY

01/09/2010 | Practice field: Labor Law

LABOR BOARD HAS 'LIFTED THE VEIL' OVER P.I OFFICE: ORDERED OWNERS FOR SEVERANCE PAY

Gal Nissim, GLOBES, December 12, 2004

THE COURT: "The defendants conducted the company as their own private business without considering legal and separated entity of an incorporated one."

The Labor Board in Tel-Aviv ordered to 'lift the veil' of corporate over the owners of "IMUT HAKIROT" P.I office. The company's shareholders, Amiram Magen and Barak Dekel, were obligated personally to severance pay and pre-dismissal notification pay for three of the company's workers who were dismissed after it was decided of its discontinuation.

The verdict was given within an over 40,000 NIS lawsuit submitted by three workers of "IMUT HAKIROT", which bore a demand for severance pay and pre-dismissal notification pay.

The claimants, represented by Advocates Ophir Miller and Adam Keren from Miller & Co. Law Offices, argued that the company's owners have a potential liability over its workers while being directors and shareholders at the same time. Contrary to that, the defendants argued that between them and the workers a personal rivalry does not exist. The two defendants conducted a joint ventured partnership, operating, in addition to the P.I office, a law office as well.

Judge Hana Ben-Yosef provided that the defendants conducted the P.I office as a private business without considering the legal and separated entity of an incorporated company. The evidence show that Dekel and Magen were actually the employers and that the partnership between them was as fully and as equally – a joint venture of private investigation office and law offices.

The board provided that the two ventures intermingled assets. The defendants did as they wished, and used the P.I office to serve their own interests and other businesses'. Therefore it was 'lift the veil' sentenced, and the court ordered the defendants recompensing the workers' severance pay and pre-dismissal notification pay

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