In early 2003, employees of Hungarian state-owned public utility and transport enterprises are demanding above-average pay increases, having been excluded from a 50% pay rise for public service sector employees introduced by the government in 2002. The government insists on wage restraint, as laid down in its budgetary plan for 2003, but trade unions representing groups such as bus and postal workers have organised industrial action, held demonstrations and submitted petitions, in support of higher wage rises.
As of 1 September 2002, Hungary's new Socialist-led government introduced a package of incomes policy measures to increase public service employees’ pay by an average of 50% (HU0207102F) Civil servants, judges and employees of state-owned public utility companies, such as railway workers, who were excluded from the wage increases are now demanding above-average pay rises in order to close the newly emerged gap between their wages and those of public service employees. The government, increasingly anxious about the growing budget deficit, has called on trade unions to observe wage restraint in 2003.
Late in 2002, in the negotiations over wage recommendations for 2003 in the tripartite National Interest Reconciliation Council (Országos Érdekegyezteto Tanács, OÉT) (HU0209101N), tensions arose between the government and the unions, especially those belonging to Alliance of Autonomous Trade Unions (Autonóm Szakszervezetek Szövetsége, ASZSZ) representing public utility employees. Despite the wage recommendation agreement for 2003 reached at the national level (HU0212105F), unions at public utility companies and other smaller unions representing various groups of public employees are pressing for larger wage increases and, to underline their demand, organised several nationwide token industrial actions in December 2002 and January 2003.
First, the Union of Employees of the Ministry of Interior Affairs and Law Enforcement (Belügyi és Rendvédelmi Dolgozók Szakszervezete, BRDSZ) demanded higher pay. It claimed that civil servants employed under the auspices of the Ministry of Interior Affairs (Belügyminisztérium, BM) received only a 7.75 % raise in 2002, while members of law enforcement corps did not receive any increase at all, and the 2003 budget law passed by parliament would not permit any pay increase in real terms. To underpin its demands, BRDSZ established a 'demonstration committee'. Other groups of civil administration employees organised by the Trade Union of Hungarian Civil Servants and Public Service Employees (Magyar Köztisztviselók és Közalkalmazottak Szakszervezete, MKKSZ) planned to stage a rally in February 2003 unless the government changes its position on public administration salaries.
At the November 2002 congress (HU0212101N) of the National Association of Hungarian Trade Unions (Magyar Szakszervezetek Országos Szövetsége, MSZOSZ), in the presence of Prime Minister Peter Medgyessy, the president of Postal Trade Union (Postás Szakszervezet, PSZ), representing 28,000 postal workers, demanded that the Prime Minister fulfil his election campaign promise to increase postal workers’ pay by 50%. In the parliamentary debate on the 2003 budget law, the Prime Minister acknowledged that postal workers’ wages lagged behind the national average and promised a gradual increase in a three-year package. Despite the promise, in January 2003, the Independent Alliance of Postal Workers (Postások Független Érdekvédelmi Szövetsége, POFÉSZ) submitted a petition signed by 5,000 employees demanding higher wage increases and threatened a strike.
The wage bargaining round at the Hungarian State Railways (Magyar Államvasutak, MÁV) has been an exception in 2003. While the last three years witnessed fierce disputes and bitter strikes, the three representative trade unions and the newly appointed management have on this occasion concluded a comprehensive collective agreement for the coming three years, which includes relatively generous wage increases for 2003, exceeding the level of the recommendations agreed at the OÉT.
In contrast with MÁV, at bus companies belonging to the state owned VOLÁN group (the 24 VOLÁN companies, employing 26,000 workers, run long-distance bus services and local transport in towns in the countryside) trade unions and management failed to agree, and unions staged a nationwide token strike. The Public Road Transport Trade Union (Közúti Közlekedési Szakszervezet, KKSZ) demanded a 26% raise for VOLÁN bus drivers and maintenance workers, claiming that VOLÁN employees currently earn an average gross monthly wage of HUF 110,000 (EUR 450), which is 25% below the national average wage projected for 2003, but work 200 hours monthly, about 20% more than the average working time.
The Hungarian Privatization and State Holding Company (Állami Privatizációs és Vagyonkezelo Rt, ÁPV Rt), the owner of the bus companies, initially offered only a 5% raise, plus a 3% increase in contributions to the 'voluntary' pension fund. KKSZ rejected the package and VOLÁN bus workers went on a two-hour warning strike on 6 January 2003, in the early morning Monday rush hour. The strike paralysed public road transport in the whole country, as about 90% of morning services did not operate. Finally, on 2 February, representatives of bus drivers agreed with the employers on an HUF 127,500 (EUR 522) average wage for 2003, which means an increase of around 11%. On the same day, following a similarly difficult series of negotiations and a strike call, trade unions and the management of the Budapest Transport Company (Budapesti Közlekedési Vállalat, BKV) signed an agreement, which stipulates a 7.9% increase in 2003 for the firm's 12,400 employees.
In January 2003, wage negotiations also began in the electricity industry. ÁPV Rt offered an increase of only 4.5% in gross wages on average. According to the Trade Union Federation of Electricity Workers (Villamosenergia-ipari Dolgozók Szakszervezeti Szövetsége, VD), this raise is not in line with the national tripartite recommendation, as in real terms it would mean a 3.60%-6.85% decrease of wages in the industry, depending on the actual level of individual wages. VD planned to stage demonstrations and warning strikes in state-owned power plants in late February unless negotiations going on with the involvement of mediators from Labour Mediation and Arbitration Service (Munkaügyi Közvetító és Döntóbirói Szolgálat, MKDSZ) resulted in an agreement. Nevertheless, privately owned companies in the sector seem willing to agree with unions on wage increases on the basis of the OÉT recommendation.