Internationally-recognized core labour standards in Hungary
IFCU Report for the WTO General Council Review of the Trade Policies of Hungary, Geneva, 7–8 July, 1998
EXECUTIVE SUMMARY
Despite the commitments Hungary accepted at Singapore in 1996 and Geneva in 1998 in the WTO Ministerial Declarations, there are still violations of the internationally-recognised core labour standards with regard to freedom of association and discrimination in Hungary.
Although the legislation on trade union rights in Hungary generally complies with internationally-recognised core labour standards, its implementation does not always do so. There are various examples of discrimination and victimisation against union officials, including in the country's increasingly large foreign-owned sector. Trade unions are concerned that the pattern of non-implementation of core labour standards shows that the government believes that foreign investment, needed to improve Hungary's competitive position on world markets, is attracted by the ease with which union organisation and representation can be obstructed. Similar concerns arise with regard to the attitude of the new private sector employers towards trade unions and adds to rising pressure on the right to freedom of association.
Discrimination persists in Hungary despite its ratification of both the internationally-recognised core labour standards in this area. Many ILO and UN reports have recommended substantive improvements in both legislation and policy implementation in Hungary in order to address these problems.
Hungary is in the final stages of ratifying the main ILO Convention on child labour. Child labour appears to be minimal in Hungary.
Hungary has ratified both the main ILO Conventions on forced labour and there have been no reports of forced labour in Hungary since the opening to democracy.
INTERNATIONALLY-RECOGNISED CORE LABOUR STANDARDS IN HUNGARY
Introduction
This report on the respect of internationally recognised core labour standards in Hungary is one of the series the ICFTU is producing in accordance with the Ministerial Declaration adopted at the first Ministerial Conference of the World Trade Organisation (WTO) (Singapore, 9-13 December 1996) and endorsed at the second WTO Ministerial Conference (Geneva, 18-20 May 1998) in which the Ministers stated: “We renew our commitment to the observance of internationally recognised core labour standards.”
The report was prepared together with the ICFTU's affiliates in Hungary, the National Confederation of Hungarian Trade Unions (MSZOSZ), with about 500,000 members and the Democratic League of Independent Trade Unions (LIGA) with approximately 100,000 members. In total trade unions in Hungary represent about 30 per cent of the workforce.
I. Freedom of Association and the Right to Collective Bargaining
Hungary ratified both ILO Convention No. 87 (1948), the Freedom of Association and Protection of the Right to Organise Convention and ILO Convention No. 98 (1949), the Right to Organise and Collective Bargaining Convention, in 1957.
The 1992 Labour Code recognises the right of workers to organise and bargain collectively and permits trade union pluralism. It provides for collective bargaining at the enterprise and industry levels, although the practice varies widely between sectors. While some sectors, such as chemicals, electricity and rail transport have almost complete unionisation, in other sectors unions are almost completely absent, such as private businesses with less than ten employees.
In the growing private sector, including the large foreign-owned sector, many employers actively discourage trade union organising by victimising and discriminating against union officials and members. The harassment goes unpunished because of ambiguities in the law and disputed interpretations. Enforcement proves difficult because the labour courts are overburdened and proceedings can take several years.
The law provides for various protections of unionists against discrimination by employers, who can potentially face imprisonment for violations of the law on freedom of association. However, concern has been expressed that these provisions are not enforced in practice and that unionists have not been adequately protected from being isolated or expelled from workplaces. The ILO Committee of Experts on the Application of Conventions and Recommendations has recommended that the government introduce “effective and sufficiently dissuasive sanctions” in this regard.
Unions further report non-observances of collective agreements and obstructions to the right to strike. Unions are often forced to meet outside workplaces. The effect of these restrictions on trade union rights has been to leave many workers extremely vulnerable to abuse of their basic rights in the workplace, as demonstrated recently during a strike by bakers in Debrecen.
Many workers are employed without employment contracts and there are reports that some foreign companies require women to undergo a gynaecological examination to ensure they are not pregnant when being employed. Problems are reported with safety conditions in many workplaces, due in part to the inadequate level of resources devoted by the government to labour inspections. A new law was introduced during 1996 improving labour inspection and increasing fines for employers who did not comply with labour regulations.
A typical practice of multinational companies has been to establish a works council as a means of preventing workers from forming a trade union. The developments at the US-owned United Technologies Automotive Hungary over 1995-96 provide an example of the violation of freedom of association in Hungary. The company had no union or works council. The management subsequently created a committee and appointed its members. In November 1995, when a group of employees began to form a union, the union leaders and some of the founding members were sacked a week after the union had been formed, on the pretext that the workforce was being reduced. They were subsequently escorted home by security guards.
In April 1996, a labour court found that they had been dismissed because of union activities and ordered their reinstatement. The court dismissed the company's proposal that it should give the unionists money instead of reinstating them. The company appealed against the decision and approached the unionists before the case came to court. It offered them money to request the annulment of the labour court judgement. The workers accepted, fearing further victimisation if they returned to the same company. The union ceased to exist.
An example of the failure to protect the right to strike in Hungary is provided by the foreign-owned company Piszke Paper, where a dispute began in 1993 when the company was privatised. Management refused to fulfil the privatisation contract which set a deadline for the conclusion of a collective agreement and co-operation between employer and employees. There were cuts in social benefits and no wage increases. Collective negotiations finally broke down on 26 February, 1996 when Piszke Paper sacked Ferenc Komoroczki, chairman of the local branch of the Hungarian Paper Workers' union and vice-president of the national branch union, after the union had organised a strike. He was also barred from entering the company's premises. The company intimidated other workers by threatening to close down.
In June 1996 the Labour Court found that the dismissal and the ban from the factory was illegal, but did not reinstate Ferenc Komoroczki at the employer's request. It ordered the company to pay him lost wages. The union appealed against his ban from the company premises but on 18 September, a court ruled that the ban was legal. On 22 November 1996, the court rejected Komoroczki's appeal for reinstatement. The union then took its appeal to the Supreme Court, which in August 1997 ordered Piszke Paper to reinstate Komoroczki. However, the company sent him on compulsory leave and after some months, his employment was terminated by mutual agreement—illustrating once again the contradictions between law and practice in Hungary.
Although the legislation on trade union rights in Hungary generally complies with internationally-recognised core labour standards, its implementation does not always do so. There are various examples of discrimination and victimisation against union officials, including in the country's increasingly large foreign-owned sector. Trade unions are concerned that the pattern of non-implementation of core labour standards shows that the government believes that foreign investment, needed to improve Hungary's competitive position on world markets, is attracted by the ease with which union organisation and representation can be obstructed. Similar concerns arise with regard to the attitude of the new private sector employers towards trade unions and adds to rising pressure on the right to freedom of association.
II. Discrimination and Equal Remuneration
Hungary ratified ILO Convention No. 100 (1951), Equal Remuneration, in 1956 and ILO Convention No. 111 (1958), Discrimination (Employment and Occupation) in 1961.
According to the National Report of the Republic of Hungary prepared for the UN 4th World Women's Conference in 1995, women earn on average 25 per cent less than their male counterparts. Such wage gaps rise to 40 per cent in industries with a predominantly male workforce. The national trade union centre MSZOSZ categorically refuted the government's assertion in 1994 that lower wages did not result from discrimination, but were because “men frequently perform harder and more difficult work; and women may be responsible for family duties and therefore cannot be counted on.” The ILO Committee of Experts on the Application of Conventions and Ratifications observed in 1997 that Hungary needed to amend its legislation on equal remuneration to make it clear that such legislation applied “to all aspects of remuneration and not only the basic wage”.
The number of women in middle or upper managerial positions in business and government is low. Furthermore, women are barred from performing a long list of jobs considered detrimental for their health, including driving transport vehicles, large trucks or tractors and piloting aircraft. The ILO Committee of Experts has recommended that the list be reviewed so that it could not give rise to discriminatory practices.
The law does not prohibit sexual harassment in the work place. A 1995 report prepared under the auspices of the UN to evaluate compliance with the Convention on the Elimination of Discrimination Against Women termed sexual harassment in the workplace as “virtually epidemic.” Women's groups report that there is little support for efforts to criminalise sexual harassment and that harassment is tolerated by women due to their fear of unemployment.
Despite its own responsibilities as an employer, the government of Hungary has conceded that discrimination in the public sector takes place on a degree similar to that in the private sector.
Budget cuts, arising from the difficulties of economic transition, caused the number of day care centres to fall by 30 percent between 1994 and 1996. Due to the unequal distribution of child-care responsibilities between men and women, this is creating particularly serious obstacles for women seeking to return to the workforce after childbirth.
In November 1997, the ILO Governing Body appointed a tripartite committee, under the provisions of Article 24 of the ILO Constitution, to look into the non-compliance of Hungary with Convention No. 111, the Discrimination (Employment and Occupation) Convention. The investigation is taking place due to discrimination against women in the government's implementation of the dismissal of 10,000 university lecturers as part of cut-backs in higher education spending. In many cases, women lecturers are being disproportionately dismissed with no regard to any defined objective criteria for deciding who should be made redundant.
Discrimination against the Romani (gypsy) community, who constitute at least 4 percent of the population, makes their conditions of work and life significantly worse than among the general population. Roma are considerably less educated, with lower than average incomes and life expectancy. The Romani unemployment rate is estimated to be 60 to 85 percent, over six times the national average of 10.3 percent. In July 1997 the Government published a plan designed to improve living conditions in Romani communities, with specific focus on public health, education, and work training.
With respect to discrimination against the disabled, a September 1997 decree required all companies that employ over 20 persons to reserve 5 percent of their jobs for the physically or mentally disabled. However, services for the disabled are limited and most buildings are not wheelchair accessible.
Discrimination persists in Hungary. Many ILO and UN reports have recommended substantive improvements in both legislation and policy implementation in Hungary in order to address these problems. The government of Hungary should certainly implement these recommendations and undertake increased efforts to overcome discrimination.
III. Child Labour
The Hungarian Parliament completed the procedures for ratification of ILO Convention No. 138 (1973), the Minimum Age Convention, in February 1998. Hungary is presently in the final stages of discussion with the ILO concerning the completion of formalities necessary for ILO registration of the ratification.
Employment is illegal below the age of 14 while education is mandatory up to the age of 16. Child workers between the ages of 14 and 16 are prohibited from night shifts and hard physical labour.
There does not appear to be any significant violation of these laws. However, Romani children are far more likely than non-Roma to drop out of school before age 16 and begin work in the informal sector, often within their family.
Child labour appears to be minimal in Hungary. However, the government needs to address the associated problem of non-attendance at school, particularly among ethnic minorities.
IV. Forced Labour
Hungary ratified ILO Convention No. 29 (1930), the Forced Labour Convention in 1956 and ILO Convention No. 105 (1957), the Abolition of Forced Labour Convention in 1994.
The law prohibits forced labour and there have been no reports of forced labour in Hungary since the opening to democracy.
CONCLUSIONS
- All seven ILO Conventions on core labour standards have been ratified by Hungary. However, there are still violations of core labour standards, particularly with regard to freedom of association and discrimination. The violation of trade union rights in Hungary, including in the country's increasingly large foreign-owned sector, impinges on unions' ability to engage in free collective bargaining.
- In line with the views of the ILO Committee of Experts on the Application of Conventions and Recommendations, the government of Hungary needs to implement measures to ensure the full application of the protection of the right to organise. The government should monitor implementation of the 1996 law improving labour inspection and increasing fines for employers who do not comply with labour regulations, with a view to introducing supplementary provisions if necessary. Measures are needed to enable labour courts to cope with the volume of work and speed up their decision-making procedures.
- The government of Hungary should implement the many recommendations of ILO and UN reports to tackle the grave discrimination in Hungary. Urgent measures are particularly needed to improve the legislation on equal remuneration and to introduce legislation to prohibit sexual harassment in the workplace.
- The government needs to address the problem of child labour in the informal sector as shown by the rates of non-attendance at school, particularly among ethnic minorities.
- In line with the commitments accepted by Hungary at the Singapore WTO Ministerial Meeting and its obligations as a member of the ILO, the government of Hungary should therefore provide reports to the WTO and the ILO on its legislative changes and policy measures with regard to respect for these internationally-recognised core labour standards.
- The WTO should request the ILO to intensify its work to assist the government of Hungary to respect the commitments it undertook to observe core labour standards at the Singapore and Geneva WTO Ministerial Conferences, and provide a report to the WTO General Council on the occasion of the next trade policy review.
References ICFTU, Annual Survey of Violations of Trade Union Rights, 1997.
ILO, Reports of the Committee on Freedom of Association, 1993-98.
ILO, Reports of the Committee of Experts on the Application of Conventions and Recommendations, 1993-1998.
LIGA (Democratic League of Independent Trade Unions), various materials.
Ministry of Labour of Hungary, National Report of the Republic of Hungary, prepared for the UN 4th World Women's Conference in 1995.
MSZOSZ (National Confederation of Hungarian Trade Unions), interview by MSZOSZ Women's Committee Chair Ms. Elisabeth Szabo in Free Labour World, March 1996.
US Department of State, Report on Human Rights Practices for 1997, 1998.
List of country reports for WTO Council reviews