Minimum wage about to be raised in Hungary

Trade unions, employers and the government are currently engaged in negotiations to review the minimum wage and guaranteed minimum wage for the year. These discussions, facilitated by an agreement established in December, aim to address any significant deviations from the initial economic forecasts.

If agreed upon, there is a possibility of an unconventional increase in both wages as early as August or September. However, this needs a unanimous decision from the Permanent Consultative Forum (VKF) of the Competitiveness Sector (Versenyszféra) and the Government, writes Napi.hu.

Correction needed

Imre Palkovics, President of the National Federation of Workers’ Councils (Munkástanácsok Országos Szövetsége), highlighted the current state of salaries. In January, the minimum wage saw a 16 percent increase, with its gross amount rising to HUF 232,000 (EUR 627,63). Similarly, the guaranteed minimum wage experienced a 14 percent increase, growing to HUF 296,400 (EUR 801,71). However, inflation has surpassed the growth in minimum wages, necessitating a correction.

Unanimously, the trade unions stress the importance of maintaining the real value of the minimum wage. They advocate for a further increase from August, or at the latest, September. Imre Palkovics emphasised that a 4-5 percent correction would align the salary increase with inflation, resulting in an 18 percent annual growth.

In addition to the minimum wage, the guaranteed minimum wage linked to secondary education also requires adjustment. To maintain its purchasing power, they propose an 8-10 percent adjustment from August or September. These adjustments would bring the minimum wage to HUF 321,360 (EUR 869,12) gross for the remaining months of the year (if increased in August) and HUF 327,600 (EUR 886) gross (if increased in September).

Why is it important?

Raising salaries is not only crucial for improving living standards but also for addressing labour shortages. This issue of low-paying jobs with bad working conditions is particularly prominent among younger generations. The failure to offer acceptable payment and improved working conditions may jeopardise the provision of essential services.

In terms of inflation-adjusted rates, the minimum wage is expected to increase by 4.1 percent gross from HUF 232,000 (EUR 627,63) to HUF 241,600 (EUR 653,46) in August and by 5.2 percent to HUF 244,000 (EUR 659,77) in September. Meanwhile, the guaranteed minimum wage is set to rise by 8.4 percent gross from HUF 296,400 (EUR 801,71) to HUF 321,360 (EUR 868,79) in August and by 10.5 percent gross to HUF 327,600 (EUR 885,66) in September.

Source: Napi.hu