Escalation in labor dispute: Histadrut files formal OECD complaint against SAP Israel

The battle between the Histadrut and multinational software corporation SAP has entered a dramatic new phase.

The Histadrut, together with the Union of Cellular, Internet and High-Tech Workers, and SAP Workers Committee, has filed a formal complaint against SAP with Israel’s National Contact Point (NCP), accusing the company of serious violations of the OECD Guidelines for Multinational Enterprises and launching an unprecedented international challenge against the tech company.

The complaint, submitted to the Ministry of Economy and Industry, alleges that SAP severely undermined workers’ rights in Israel by unilaterally halting collective bargaining negotiations and tearing up seven existing collective agreements without prior consultation or good-faith negotiations.

SAP’s actions shattered labor relations inside the company, deliberately weakened employee representation, and triggered a dangerous escalation between management and workers that has already led to a labor dispute and operational disruptions.

The OECD National Contact Point, a government body responsible for enforcing international standards for responsible corporate conduct, now has the authority to launch an immediate review, compel the parties to enter mediation, and ultimately publish a public ruling on whether SAP violated international rules governing multinational corporations.

While the NCP cannot impose direct financial penalties, a negative ruling could inflict major reputational and business damage on SAP worldwide. Such a finding could jeopardize the company’s position in public tenders, intensify pressure from investors and financial institutions, and expose the company to further regulatory scrutiny across multiple countries.

In a move designed to dramatically increase international pressure, the Histadrut is also seeking to involve Germany’s National Contact Point, given that SAP’s global headquarters are based there.

SAP Israel employees have been organized under the Histadrut since 2014, led by workers’ committee chair Gad Ravid. Over the years, multiple collective agreements were signed regulating labor relations at the company. According to the Histadrut, the current crisis erupted after SAP management made the unilateral decision to cancel those agreements, a move the union describes as an all-out assault on organized labor.

At the same time, Yakki Halutzi, Chair of the Histadrut’s Union of Cellular, Internet and High-Tech Workers, has appealed to Chief Labor Relations Commissioner Adv. Rivka Verbner requesting an immediate freeze on proceedings. The Commissioner has already summoned the parties for urgent discussions.

Peter Lerner, Director General of the Histadrut’s International Relations Division and the initiator of the complaint, said:

“This is not just another labor dispute. This is a test of whether multinational corporations believe they can ignore international labor standards and crush workers’ rights without consequences. We will not stand by while workers’ rights are systematically violated. SAP must immediately stop its unilateral actions and return to the negotiating table in good faith and in accordance with international standards.”