The cash-strapped Israeli branch of Austrian furniture giant Kika must pay some
250 employees their April wages within 72 hours, the Central District Court
ruled Sunday morning.
The court extended its freeze on all legal
proceedings against Kika to June 3.
Employees turned up Thursday morning
to find Kika’s Netanya store locked, with the company’s Israel operations
apparently on the verge of collapse. Since opening to much fanfare in September
2011, the store has struggled to match rival IKEA’s two stores in Netanya and
According to figures produced by Ashtrom Properties, 15
percent owner of Kika Israel, the company lost NIS 44.5 million in 2011 and NIS
13.5 million in 2012.
Following the court ruling, Kika Israel said that
it requested the freeze first and foremost to enable it to pay its
Over the coming days, the company added, it will reveal its
financial situation to a court-appointed team with the aim of formulating a
program to continue operating.
The Histadrut labor federation – which has
represented Kika employees since they unionized on Thursday – welcomed the court
ruling and said it would continue to fight for all of the employees’