Négociation collective
Collective bargaining primarily takes place at company/organisational level, despite considerable efforts by both unions and the current government to encourage industry level bargaining. At best only 40% of employees are covered by collective bargaining of any sort.
The framework
Despite efforts by the unions and to a certain extent by the government to strengthen bargaining at industry level, the main level of bargaining is company/organisation level, although it is losing out to a situation where no bargaining takes place at all. The national level discussions between unions, employers and government are also very important in setting the framework for bargaining.
Figures from the ministry of labour, based on the number of collective agreements registered with it, show that in 2005 there were around 3,400 collective agreements, covering 1,125,000 employees – equivalent to 40% of all employees. However, figures from the 2004 labour force survey which asked respondents whether their workplace was covered by a collective agreement, produced a much lower figure – only 25% – although half of the respondents said they did not know.
The vast majority of the agreements – 3,327, covering 890,000 employees – were for a single employer. Almost two-thirds of these agreements were for employers in the public sector, although, in terms of the numbers of employees covered, the proportions are reversed. There are only about a dozen genuine industry level agreements and despite efforts by the government to strengthen industry level bargaining, there is no consistent evidence that this is occurring. An industry level agreement was reached for the construction industry in 2005 but elsewhere there has been employer pressure to withdraw from existing industry agreements.
The ministry of labour figures on registered agreements indicate that collective bargaining coverage fell by six percentage points between 2001 and 2002 – from 47% to 41%, although it has remained broadly stable since then. In its report to its 2006 congress MSZOSZ reported a decrease in the number of company level agreements.
Unions are, however, able to influence bargaining developments through a tripartite body now called the National Interest Reconciliation Council (OET). This was reconstituted by the socialist-led government in 2002 after being largely dismantled by the previous right-wing government. It provides a forum in which the three parties can agree the national minimum wage for the coming year and also make recommendations to lower-level bargainers, although these recommendations are not binding. A three-year outline for pay increases was reached in the OET at the end of 2005, although there have been difficult negotiations at the end of 2006 and start of 2007 to agree increases for 2007.
Who negotiates and when?
Negotiations at both company and industry level are between employers or employers’ associations and the unions. The previous government had given works councils (see section on workplace representation) negotiating rights at company level where there were no unions present, but this was reversed by the socialist government in 2002.
To be entitled to negotiate a union must get 10% of the votes in the works council elections and if it has more than 50% it can sign the agreements alone, otherwise it must take account of the views of other unions.
Agreements are normally signed for a year.
The subject of the negotiations
Agreements typically cover pay, working conditions and procedural issues. However, the most recent negotiating rounds have concentrated on working time and work organisation because legislative changes have made it possible to have greater flexibility in working time arrangements, provided that it is negotiated.
Although there is a national recommended pay increase, agreed in the tripartite OET, unions at company level often find it difficult to implement it, as employers argue that they face particular difficulties. In addition recent increases in the minimum wage, which applies directly, have meant that in some cases the negotiated rates were below the statutory minimum and so there was no need to negotiate an increase.
Hungary’s national minimum wage is set by the government following recommendations by the employers and unions, effectively through a deal in the national tripartite body the OET.
