Dispute at Budapest Airport resolved after strike

The annual wage negotiations in early 2007 generated further conflict between companies and trade unions operating at Budapest Ferihegy Airport. The dispute escalated into strike action against two employers operating at the airport, causing a considerable number of flight delays. The conflicts were eventually resolved with the involvement of the Labour Mediation and Arbitration Service and agreements were finally reached in May and June 2007.

Background

Ferihegy Airport in Hungary’s capital city of Budapest has long been a contentious industrial area (HU0401101N, HU0509101F). In 2005, conflict arose between Budapest Airport Co. (Budapest Airport Rt, BA) – the company operating Ferihegy International Airport – and the trade unions, leading to strikes on four occasions. The following year saw clashes between Hungarian Air Navigation Services (HungaroControl – Magyar Légiforgalmi Szolgálat) and the Hungarian Air Traffic Controllers’ Trade Union (Control – Magyar Légiforgalmi Irányítók Szakszervezete), which eventually ended with a wage agreement and a strike moratorium until 2010. However, other important issues regarding other employers at the airport were not been resolved and the disputes in 2007 represent a continuation of previous conflicts.

Privatisation of Budapest Airport

At the end of 2005, BA was privatised (HU0510101N). Its first buyer was BAA, acquired later by Grupo Ferrovial. Subsequently, in the spring of 2007, the German company Hochtief AirPort GmbH (HTA) acquired the company. In the course of the privatisation, the Turkish company Celebi acquired Budapest Airport Handling Ltd (Budapest Airport Földi Kiszolgálási Kft), which employs 680 people and which also uses temporary agency workers.

Other employers also participate in the provision of ground services at the airport: for example, BA is responsible for the maintenance of parking lots and the cleaning of terminals. Another company involved in the dispute is Airport Fuel Supply Ltd (Repülőtéri Üzemanyag Kiszolgálási Kft, RÜK), a subsidiary of BA, which employs 72 people and which handles the refuelling of some of the incoming and outgoing planes.

Trade union representation

The following trade unions represent employees providing ground services at Ferihegy Airport:

  • the Alliance of Ticketing Workers (Jegykezelők Érdekvédelmi Szervezete);
  • the Trade Union of Traffic and Ramp Officers (Forgalmi és Rampatisztek Szakmai Szakszervezete, Fortisz);
  • the Trade Union of Airport Workers and Service Providers (Repülőtéri Dolgozók és Szolgáltatók Szakszervezete, RDSZSZ);
  • the Independent Trade Union of Airport Traffic Workers (Repülőtéri Forgalmi Dolgozók Független Szakszervezete, RFDFSZ);
  • the Trade Union of Aviation Workers (Légiközlekedési Dolgozók Független Szakszervezete, LDFSZ).

Ground stewards are represented by the Workers’ Union of Flight Service Provision (Járatkiszolgálók Érdekvédelmi Szervezete), which was also involved in the dispute.

Wage negotiations generate conflict

The disputes in 2007 are connected to the wage negotiations at BA and at the ‘national’ airline, MALÉV, owned by the Russian cargo airline AirBridgeCargo (ABC). The largest trade union at Malév is LDFSZ, which also represents employees working in ground service provision. Wage negotiations between the trade unions and Malév became so heated that communications broke down, and on 10 February 2007 mediation services were requested. At Celebi, the employer proposed a 3% rise in variable wages instead of a base wage rise, while the trade unions demanded an 18% pay increase. Since the principle of the distribution of the wage bill was also disputed, the negotiations came to a halt on 11 March. Negotiations also failed at RÜK, and the trade unions called for the involvement of the owner, BA.

On 13 March, representatives of Malév, Celebi, RÜK and BA met with the trade unions, but only managed to reach the decision that further negotiations should be held on 19 March. During the latter round, Celebi proposed a 5% pay rise, in addition to a change of working hours, which would have implied a cut in shift bonuses. RÜK proposed a 5.5% increase, which the trade unions rejected. At Malév, negotiations did not go beyond the point of articulating demands.

Workers resort to industrial action

On 23 March, the trade unions representing employees at Celebi announced a three-hour strike for 27 March and, if deemed necessary, a further 72-hour strike on 29–31 March. A six-hour strike was also announced at RÜK for 31 March.

The majority of employees participated in the strike at Celebi on 27 March, causing delays for 22 flights. Another 24-hour strike was held on 30–31 March at Celebi, affecting 75 flights in total. Management staff filled in for the striking workers where necessary; according to the employer, workers in some departments, such as the cleaners, did not join the strike.

LFDSZ’s president announced that no further strikes were planned but insisted on their demand for a pay rise of between 18% and 20%. However, following the negotiation round between Celebi and the trade unions on 30 March, the media broke the news that ground handling workers would hold a 72-hour strike if their demand for a 10% base salary increase and a 5% end-of-year bonus were not met. Celebi had proposed a 4% base salary increase and a 3% end-of-year bonus.

A 48-hour strike subsequently took place on 5–7 April, during which time 18 flights had to be cancelled. About 400 out of 2,000 employees took part in the strike action. Employees from various airlines and Celebi’s management performed some of the strikers’ jobs.

Employer attempts to reach individual agreements

By the negotiation round of 12 April, Celebi proposed a 6% pay rise but excluding the end-of-year bonus. Once again, however, the five trade unions listed above reiterated their earlier demand and announced that they would discuss plans for further strike action.

In the meantime, the employer approached about 120 members of the permanent staff and temporary agency workers and, outside of collective negotiations, signed agreements with them for a 6% pay rise. This agreement also stipulated that some of the temporary workers would be taken on as permanent staff with flexible working hours. The five trade unions involved accused the employer of using illicit measures to reach individual agreements with an estimated 30–35 workers, instead of a collective agreement.

Celebi announced that, by 17 April, a further 70 people had expressed their intention to sign an individual agreement. In the meantime, RDSZSZ filed a complaint against the employer which, according to the Labour Code, can be made by trade unions against employers using unlawful measures. In this case, they considered it unlawful to conclude individual agreements during collective negotiations in which a modification of the collective agreement was at stake. An appeal was also made to the Hungarian Labour Inspectorate (Országos Munkavédelemi és Munkaügyi Főfelügyelőség, OMMF), as the trade unions were informed that temporary agency workers had worked more than the maximum daily limit of 12 hours during the strike.

Agreement through mediation

Negotiations continued on 18 May with the involvement of the Labour Mediation and Arbitration Service (Munkaügyi Közvetítői és Döntőbírói Szolgálat, MKDSZ). Celebi’s management and the trade unions finally agreed on a 7.7% base wage increase retroactive from 1 April 2007. The agreement also stipulated that the trade unions would not organise any further strikes until the end of the year and that after this period they would notify the employer of strike action 36 hours in advance, instead of the two-hour notice required at present. Furthermore, Celebi agreed to offer permanent employment to 20 employees who are on fixed-term contracts.

Wage negotiations at MALÉV ended on 20 June with an agreement ensuring a 5% base wage increase, retroactive from 1 January 2007. An agreement was also reached about increasing the entitlements for food and recreation allowances, incorporated into the base salary from 1 January.

Commentary

The large number of employers and trade unions, often representing diverging interests, made it very difficult to conclude a single agreement covering all employees at Ferihegy Airport. The Air Traffic Sectoral Dialogue Committee (Légiközlekedési Ágazati Párbeszéd Bizottság, LÁPB), established in 2003, did not engage in the dispute as it was not handled as a dispute extending to the entire airport or sector. On the employers’ side, a number of factors impeded reaching a unified agreement and productive negotiations, such as a series of takeovers of the companies affected, outsourcing and unclear company profiles. On the employees’ side, the unusually fragmented, occupation-based trade union structure represented a particular weakness. Members of LÁPB who were not directly involved refrained from issuing any statement or intervening, even though the impact of the strike at a given employer extended to other employers also.

During the strikes, a number of issues also arose in relation to the use of temporary agency workers. Hungarian law prohibits substituting workers engaged in strike action with temporary agency workers, although if the latter are already employed by the company, they are allowed to continue working, as was the case in this particular conflict. While one trade union considered that such workers were breaking the picket line, interestingly, during the negotiations for individual contracts, the employer offered to hire the temporary agency workers as permanent staff. This suggests that the trade unions should also change their representation policy, as the final contract envisaged only turning some of the fixed-term employment contracts into open-ended contracts. It should be noted that, in Hungary, agency workers are usually not organised, nor are they covered by collective agreements.

Given the confusion generated by this situation, mediation proved to be an important tool. The appearance of the mediator put an end to the ongoing media war which was being waged by Malév and Celebi, since the MKDSZ cannot issue statements and requested that the parties also refrain from making public statements. At the same time, the mediator was able to reconcile the diverging points of view, which made an agreement acceptable for all of the parties concerned.

Although an agreement was reached for 2007, long-term industrial relations peace will only be possible if takeovers, outsourcing and the restructuring of companies are settled and if employers and employees establish a unified representation structure and negotiation system covering the entire airport.

Erzsébet Berki and László Neumann, Institute for Political Science, Hungarian Academy of Sciences

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