Description
Sectoral collective agreements in Hungary
In Hungary, collective agreements can be concluded by trade unions of employees and public institutions, and are governed by the Labour Code. The current Act I of 2012 on the Labour Code (hereinafter referred to as the "Labour Code") refers to three types of collective agreements: single-employer collective agreements; multi-employer collective agreements and; collective agreements concluded by a trade union federation. Entitlement to conclude collective bargaining agreements is not determined according to the same rules in these cases. In principle, the trade union must represent 10% of the workforce. In the case of a trade union federation, it is sufficient to have one such affiliated organisation or a contracting authority. One or more employers or an association of employers automatically has the right to conclude collective agreements (the association if its members have authorised it to do so). In the latter case, the trade union federation wishing to conclude a collective agreement with the employer must also be 10% organised.
There are currently 22 sectoral dialogue committees operating legally in Hungary. One of these is the Sectoral Dialogue Committee for the Light Industry (KÁPB), whose employers are represented by the Association of the Hungarian Light Industry (www.mksz.org) and whose employees are represented by the Trade Union of Mine, Energy and Industrial Workers(BDSZ, www.banyasz.hu). The BDSZ has 2 local trade union branches in the leather industry.
There is an obvious correlation between trade union organisation and collective bargaining coverage, especially in Hungary where single-employer collective agreements account for the majority of contracts. Unfortunately, in the Hungarian leather industry and the whole Hungarian TCLF sector, trade union membership is low, barely 3%, which is very low for extensive collective bargaining practices to be in place. In order to establish the exact coverage, it is necessary to know the number of employees covered by collective agreements and the total number of employees in the sector, but these data are not easy to obtain as there is no credible national database.
According to the official government register, the MKIR (www.mkir.gov.hu), there are 52 collective agreements in force in the TCLF sector. In the Leather and footwear sector, there are 6 single-employer collective agreements covering 1916 employees and 6 multi-employer collective agreements covering 566 employees.
A total of six collective agreements are available in full for content analysis. One of them is linked to an annual wage agreement and one is a so-called multi-employer collective agreement, in this case covering two employers. Of the six agreements, two were concluded in the textiles sector, two in the clothing sector and two in the leather and footwear sector. All but one were concluded after the entry into force of the so-called new collective agreement on labour law in 2012.
Summary
Collective bargaining coverage in the domestic light industry is low, mainly due to the lack of trade unions and low organisation. The collective agreements in force in the sector are not regularly reviewed, and as a result some of their provisions are in conflict with the provisions of the Labour Code. Otherwise, the collective agreements in the sector show a balanced regulation of issues traditionally covered by collective agreements. However, only one collective agreement is linked to a current wage agreement, i.e. the most important issue of working conditions is settled by employers without the involvement of the trade union. The sector is highly exposed to changes in the economic situation, including changes in public consumption. Therefore these trends are not expected to change in the current situation, which could be a period of recovery, when the social partners could significantly improve the situation.
European-based multinational companies are increasingly addressing the issue of collective bargaining, with the social partners seeing the solution in the form of agreements that would regulate the whole vertical production chain in some way across borders. Such agreements are indeed a significant step towards improving employment conditions in the sector.