Circumventing Trade Unions in Hungary: Old and New Channels of Wage Bargaining

Abstract

This article examines continuities in the marginalization of trade unions in Hungary. Beneath the surface of party-led, bureaucratic organizations of the `command economy', strong groups of workers engaged in informal wage bargaining with management. In the 1980s a special internal contracting system offered core workers the opportunity to carry out collective wage negotiations, circumventing the formal trade union channels of representation. In the post-communist era, rights of union organization and collective bargaining are formally assured, but these institutions are not the main determinants of wages, hours, terms and conditions of employment. In particular, after privatization some former state enterprises introduced Employee Share Ownership Programmes. Employees who are share-owners gain higher income through dividends and enjoy better job security and preferential terms and conditions of employment. In these companies, distinctions between core and periphery are now disguised as property relations, displaying surprising similarities to the 1980s.

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