László Neumann

Does Decentralized Collective Bargaining Have an Impact on the Labour Market in Hungary

Previous institutional analysis of collective bargaining in Hungary found that an extremely decentralized wage-determination system was created after the change of the regime. Statistical sources show a fairly high coverage of company agreements, but case studies reveal that only a small proportion function as in developed market economies. This article uses a cross-sectional survey to provide a quantitative evaluation of the outcome of company-level bargaining. It analyses the wage gap between union and non-union settings, and differences regarding wage dispersion, productivity and other labour market dimensions. Compared to other countries with decentralized bargaining systems, Hungarian unions have almost negligible achievements in terms of the average union wage gap, and wage agreements do not have a strong regulatory effect. Unions do not represent any substantial barrier to increased productivity, but they do reduce earning inequalities.

Transformation and foreign direct investment: Observations on path dependency, hybridisation, and model transfer at the enterprise level

This article deals with the impact of foreign direct investment (FDI) on transformation processes in Central and Eastern Europe (CEE). Our specific interest is in the effects of FDI on the organisation of work and labour relations at the enterprise level; in a more general sense we are concerned with the contribution of FDI to the creation of the microeconomic foundation essential to functioning market economies. We hold that there is a discernible process of selective harmonisation taking place between outside influences and existing domestic factors. In this context we postulate that the importance of FDI is further enhanced by the fact that it influences a broad array of societal transformation processes beyond the enterprise itself, thus contributing to a process which could develop into what we have labelled a European-style environment. Admittedly, the outcome can as yet only be rudimentarily defined, especially since a European-style environment, as a point of reference, is itself currently undergoing continuous change. But we hypothesise that it will be a process which reflects to varying degrees both the endogenous and exogenous sources of its making.

Outsourcing of public services in Europe and segmentation effects: The influence of labour market factors

This article examines the influence of labour market factors on public authorities’ decisions to outsource public services in five countries. The dominant focus in the outsourcing literature is on a narrow range of factors: public–private gaps in pay, union membership and collective bargaining coverage. We find such differences to be variable, and develop a more encompassing perspective. This includes consideration of labour market rules that establish wage floors and employment protection (especially for outsourced workers) and the possible differentiation of legal status between public and private employees. Our case studies from local government in five countries highlight a set of country-specific interconnections between labour market factors and outsourcing. These lead to variations in both managers’ and unions’ approaches towards outsourcing and in outcomes for pay and working conditions. We call for a strengthening of the inclusiveness of industrial relations structures to combat problems of workforce fragmentation caused by outsourcing.

Crisis of the Post-Transition Hungarian Model

It is a common wisdom to say that Hungary has faced two historical challenges since 1988: first, the so-called ‘regime change’ which took place in 1989/90 when the state socialist system collapsed and gave way to democratization and a market economy based on private ownership; and second, joining the European Union which formally took place on 1 May 2004. The former involved far-reaching changes in politics, economy and society, and at the same time represented a real break with the past in many fields. The latter on the other hand involved a relatively smooth transition with incremental changes. No wonder that a huge body of literature across political science, economics, sociology, anthropology and even psychology deals with the ‘post-communist’ transition/transformation (the choice between the two terms is also addressed by many writings). In contrast, the enlargement of the EU has been addressed by highly specialized papers only, characterized by a limited focus, mainly on administrative, legal, economic and technical aspects.

Austerity and politically motivated changes – wage bargaining in Hungarian municipal services

Salaries of public sector employees have been the number one target of austerity measures applied by successive Hungarian governments since 2006, and trade unions have found it difficult to influence government policies. Until 2008 the outcomes of centralized quasi-bargaining somewhat mitigated the harsh measures, but later governments, especially the right-wing one in place since 2010, abandoned such negotiations, implementing labour law reforms that weakened trade union bargaining power and concluding selective agreements solely with representatives of certain strong groups of employees. Social dialogue institutions have become especially weak at sectoral and municipal levels. Though decentralized collective bargaining is common in larger private sector companies, and though the legal regulation is similar in state-/municipality-owned companies, genuine collective bargaining within the latter is very rare. The article presents two case studies (on geriatric care and public transport) highlighting current developments and their impacts on employment relations.

Negotiating better conditions for workers during austerity in Europe

Negotiating Better Conditions for Workers during Austerity in Europe : Negotiating Better Conditions for Workers during Austerity in Europe