Policy Agenda and the Hungarian Trade Union Confederation jointly performed a survey at the end of 2013 on the views regarding the national wage agreement reached between the employers and the trade unions, and also made a research on the pay rise planned for 2014 among the SME managers. As figures reflect the company managers are very cautious as for pay rise, and many fear the alleged official sanctions.
The Majority are Aware of the Wage Agreement
National wage recommendation for 2014 came into being as a result of negotiations between the trade unions and the employers at the end of the year. Although some doubt its relevance but by many it is regarded as a benchmark.
Traditionally, trade unions have less influence on the SME sector. That is why the company managers’ opinions on the wage recommendation are significant and it is also important to map to what extent the recommendation is known among the managers, and whether they abide by or are inclined to adhere to the recommendations.
58% of the company managers heard that the national wage recommendation for 2014 has been accepted, but just slightly more than one-fifth was able to tell the exact rate. This means, the news that the national wage recommendations were accepted was not dealt with enough in the media but the minimum wage agreement, or perhaps the employers’ organisations did not have enough time to communicate the results of negotiations to their members.
However the fact that 42% of the company managers have not heard at all about the wage recommendations suggests serious failures in communication. Unfortunately, due to the fact that there are no trade unions at all at the majority of the mentioned companies, the employers’ associations or chambers should disseminate such information.
Deep Footprints Left by the Wage Commando
The figure coincides with our expectations that the absolute majority of company managers do not consider the wage recommendation an influential factor. 61% of the respondents tell that in their opinion wage policy is in general adjusted to the financial status of a company. They argue that in the SME sector employees normally have less opportunities to exert influence on issues due to the lack of well organised interest representation.
However we find it more astonishing that 19% of the companies in the SME sector reckon that wage recommendation is necessary to be followed for non-observance might induce official inspections or audits. Obviously this “fear factor” derives from the wage commando launched in 2011. Then the governmental parties threatened with the so-called “wage commando” that is official inspections to get managers to give pay rise. This policy seems to have left deep footprints behind.
A significant number of managers (14%) deem the wage recommendation to be a compass for them, while only 6% think that adherence to the wage recommendations prevents labour force migration. That would be the main goal of a wage agreement on a properly functioning labour market.
Many Do Not Plan Pay Rise
48% of the company managers told they had not planned pay rise for 2014. But there are already many (32%) who know they will implement a pay rise in 2014 at least to an extent suggested by the wage recommendation. At the time of the survey many reported that they were not yet sure what wage policy to follow in 2014.
However, relative to their own companies company managers are a lot more optimistic about the SME sector as a whole or as regards their competitors. 56% told that a pay rise of gross 3.5% would be granted in this sector. Only 32% do not expect such a big rise at all, and 12% still cannot tell how the wages will change.
According to figures the company managers are very cautious in terms of pay rise. As experienced recently the majority of the managers will adapt to the national wage recommendations again this year. Nevertheless it will be surely more difficult to attain pay rise in fields where the interest representation of employees is less organised.
This was a representative survey, based on the responses received from 500 company managers involved, to provide an overview regarding the economic activity of small and medium sized enterprises. The survey was performed in the period between 13 and 19 December 2013 on an on-line company panel, and through telephone interviews.