Industrial Relations in Europe 2012 - European Commission - Europa

Pay Cut Pay Freeze Other measures
HU Cut by 7% in 2008-2010 Pay freeze since 2009 Abolition of 13th month salary (8% of annual salary) replaced by
lower flat-rate payment for most public sector workers(2009/10)
7000 government job cuts announced in 2012
NL
No wage agreement
concluded in central
Planned job reductions in central government by 2015
Ending of LIFO principle in 2012 making it easier to dismiss
government since central government workers
2011- a wage freeze
PL For two years Teachers excluded from pay freeze (pay has increased)
PT 5% pay cut in 2011
For 2012 13 th and 14 th month
payments suspended for
medium and high salaries,
despite a challenge in the
Constitutional Court
RO 25% temporary cut in 2010
partly restored under new pay
system
SI 4% in 2011, additional cuts of
8% on average in 2012
2 year pay freeze
from 2011 until 2013
Reductions in health benefits.
2012 The new pay system introduced in 2012 eliminates a range of
bonuses and abolishes the 13th month pay
2011 and 2012 (six
months)
SK Paybill cut by 10% in 2011 Teachers and some other groups are not affected by the pay cut
SE No - wage
moderation
UK Cuts in premium payments 2010-2012 some
and allowances, especially in exemptions for lower
local government
paid
Sources: see list of information sources
Reductions in employment of staff on fixed-term contracts
Cap on pay rises of 1% planned for 2013/14
Large reductions in employment underway – in excess of 10%
between 2010-2015.
Estonia, Latvia, Lithuania, Hungary, Romania, Ireland, Portugal and Spain amongst others have
also made substantial pay cuts, often as part of the lending conditions established by the
international community. Latvia provided undertakings to the IMF to reduce central and local
government funding for wages by 15% in 2009 with limits to additional payments. Protection for
the low paid resulted in a smaller public sector paybill reduction of around 5% in the first half of
2009. Continuing economic difficulties prompted further pay cuts in a supplementary budget of
June 2009 and an average 18% pay cut by late 2009 with teachers worst affected. In Hungary
during 2009 the 13 th month salary was removed, worth around 8% of annual pay. Romania also
moved towards the removal of 13 th month payments and holiday bonuses, but in addition passed a
temporary six-month 25% across the board reduction in pay for the second half of 2010 as a
precursor to longer structural reforms of pay determination. In Ireland the first phase of pay
reductions in 2009 took the form of a differentiated pension levy which on average reduced pay by
7.5%, with cuts in basic pay on an income related scale of between 5-15% implemented in January
2010. Subsequently no additional pay cuts have been introduced as a result of the Croke Park
agreement (see box 4.2). In Portugal pay cuts of 5% were introduced later, at the start of 2011, but a
deteriorating fiscal position led to further pay reductions brought about by the suspension of the 13 th
and 14 th month salaries for those workers earning above EUR 1,100 per month with lesser
deductions for those below this threshold. The Spanish government also introduced an average 5%
pay cut in June 2010 and this was followed by a pay freeze, at the new lower level for 2011. The
government elected in autumn 2011 immediately extended the pay freeze for 2012 and took
additional measures to reduce public expenditure.
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