Magyar Telekom Reaches Agreement with Trade Unions

Magyar Telekom, the leading Hungarian telecommunications service provider, has announced that it has reached an agreement with the trade unions on a headcount reduction and wage increases at the company in 2020.

The company agreed with the trade unions on the termination of the employment relationship of some 450 employees, with the majority of the terminations expected to be carried out in the first quarter of 2020. Severance expenses related to the headcount reduction are estimated to be approximately HUF 4.9 billion, the majority of which will also be accounted for in the first quarter of 2020.

A report by the company states that in order to maintain wages at competitive levels, pursuant to the agreement with the trade unions, from April 1, 2020, non-managerial employee salaries at Magyar Telekom will rise by an average of 5%.

The above measures, coupled with other agreed modifications to the employee remuneration structure, are expected to result in about 3% savings for 2020 in parent company employee related expenses – excluding severance expenses – compared to 2019.