2008 Annual Survey of violations of trade union rights - Hungary

Population: 10,000,000
Capital: Budapest
ILO Core Conventions Ratified: 29 – 87 – 98 – 100 – 105 – 111 – 138 – 182

The law protects trade union rights, but some problems persist as regards the right to bargain collectively. The Korean Hankoon Tyre company lost a part of state funding for union-busting and labour law violations. Several violations of the right to strike were reported during the year.

Trade union rights in law

The Hungarian Constitution and the Labour Code recognise the right to organise and the right to strike. The 2002 Labour Code obliges the employer to deduct union membership fees from the employee's pay and transfer them to the union concerned upon receipt of a written request by the employee. The Code also provides for statutory time off for union activists. The employers are not allowed to hire temporary agency workers during a strike, but temporary workers already hired before the strike are allowed to continue working.

Union officials protected from dismissal: The law prohibits trade union discrimination and provides for protection from dismissal for trade union officials. However, the National Confederation of Hungarian Trade Unions MSZOSZ (affiliated to the ITUC) reports that if a trade union refuses to agree to a shop steward's dismissal, and the employer appeals the refusal in court, defending the trade union position becomes very difficult. The 2005 amendment to the Labour Code eased the trade union's burden of proof, but it has not yet resulted in the more efficient protection of trade union officials.

High hurdles to collective bargaining: Collective bargaining is permitted at the enterprise and industry level. Section 33 of the Labour Code requires trade unions to represent 65 percent (individually) or 50 percent (jointly) of workers to be able to engage in collective bargaining, which is in excess of ILO standards. New legislation introduced in 2006 that applies to public service gives the right to bargain collectively to trade unions who represent, individually or jointly, at least 25% of the workforce in a given agency; otherwise, the collective agreement must be voted on. Once a union is established, the employer and the union are under an obligation to cooperate. Under a separate law, public servants may negotiate working conditions, but the final decision on increasing public service pay rests with Parliament.

Constitutionality of social dialogue questioned: In December 2006 the Parliament passed a law on the National Interest Reconciliation Council (OET) and another law on sectoral social dialogue committees, both laws fully accepted by workers' and employers' organisations. The Hungarian president, László Sólyom, vetoed both laws and transmitted them to the Constitutional Court. While the president's concern with the sectoral committees was largely technical, he claimed that in case of the OET, since the majority of workers and employers in the country were not organised, the institution lacked legitimacy to exercise public powers such as determination of minimum wage and right of consent in the rules of job assessment. No decision was taken by the end of the year.

Good conduct in labour relations becomes a condition for state tenders: Hungarian companies that wish to bid for state-funded tenders need to prove their good conduct as regards labour relations. A company must certify that it has not been sanctioned for violating labour laws, that it is not a party to court proceedings that could result in such a sanction being imposed, and that there are no significant conflicts between the company's management and labour. As a result, large companies have begun to appreciate the importance of good cooperation with trade unions. Clearer responsibilities and a stronger mandate for the labour inspectorate have also had a positive impact, especially after it was decided that an inspection should follow any worker's or trade union's complaint. A new tripartite body, the Council for Supporting the Labour Inspectorate, has been established.

Trade union rights in practice and Violations in 2007

Background: The country was overwhelmed with strikes and protest. In November several trade unions organised a nationwide strike and a 10,000 people strong rally in front of the Hungarian Parliament, protesting the overhaul of the health and pension systems. On the other hand, just like a year ago, violent far-right protesters took over the streets of Budapest in October, with riot police using tear gas and water cannons. In February, a special commission of enquiry into 2006 events criticised the police for the excessive use of force.

Weaknesses in the system: Two national trade union centres, MSZOSZ and LIGA, have reported cases of employers intimidating trade union members, transferring, relocating or dismissing trade union officers, and hindering trade unions from entering the workplace, noting that such violations are repeated year by year. Although unfair dismissal cases are usually won by the workers, it is not uncommon for court proceedings to take over a year. Unfortunately, too few cases are exposed, or even reported to the trade union organisations, because of workers' insufficient legal knowledge and fear of blacklisting. However, in a number of cases workers and trade unions have had their rights adequately protected in the courts.

Protestors accused of politicking: In November, LIGA had its independence questioned by the ruling party. On 18 November, a member of the right-wing opposition party, Fidesz, stated that the party fully supported the demonstrations, although they would not participate in them. This prompted the Socialist Party spokesperson István Nyakó to suggest that the trade union action was in fact political and that Fidesz had been pulling strings in the background. LIGA vehemently denied these accusations.

Hankook Tyre – state funding and union busting: In June, having secured a deal of approximately 1 million Euros in state funding, the Korean Hankook Tyre factory opened a factory in the city of Dunaújváros (central Hungary). The Hungarian government called it "the investment of the decade" and "the most modern factory in the world", but what also made international headlines was the company's violations of workers rights. On top of extreme overtime, poor working conditions and pay irregularities, the management was enticing workers not to join trade unions, obstructing union meetings and intimidating the local trade union representatives. The local organisation of ICEM-affiliated Federation of Chemical, Energy and General workers' union was told to prove that it was organised legally within the company. When the union refused to give the employer its full membership list, the management said that the union would not be recognised and that the works council would be the only bargaining partner. At least one trade unionist was sacked during the year. The union's complaints were thoroughly investigated, and in September the company had to pay an equivalent of almost 100 000 euros for violations of labour laws, including bringing in irregular migrants. The government reacted by postponing a part of subsidies in November.

Budapest airport on strike again: Last year's Survey reported anti-union behaviour in the Budapest airport. This year brought more conflicts, leading to a number of strikes in spring. When the unions and the employers could not reach the agreement on wage raises, the Turkish company Celebi that acquired Budapest Airport Handling Ltd approached some 120 workers individually, offering them pay raises by means of individual agreements. Temporary agency workers were enticed to sign the agreement with a promise to be re-hired on a permanent basis, and they were asked to work overtime to compensate for the strikers. The RDSZSZ union (affiliated to LIGA) filed a complaint to the labour inspectorate; however, the dispute was later resolved through mediation.

More attacks on the right to strike: Trade unions in the electricity sector and the Hungarian state railways called strikes for the beginning of February 2007 in response to the government's attempt to eliminate employees' benefits. Four employers' organisations tried to get an injunction from the Labour Court of Budapest, claiming that the employers affected by the strike were victim of the government's decision in which they had no say, and that therefore the strike was illegal. The court rejected the claim. In August, there were reports of the Budapest public transport company trying to recruit temporary bus drivers in view of an upcoming strike.