Magyar Telekom on Friday said it reached an agreement with trade unions on layoffs and wages that will reduce labor costs by more than 8% in 2011 compared to two years earlier.
Under the agreement, Magyar Telekom will lay off 300 staff at the parent company in 2011. Retiring staff will not be included in the number. Severance pay related to the layoffs will come to about HUF 3.5 billion, to be booked in Q4 2010 and 2011.
Unions agreed to a 4% pay rise for 2011, to come into effect from July. About 520 of the company's higher paid staff will be entitled to an average wage increase of 2%. A minor part of staff bonuses will be linked to Magyar Telekom's performance and will only be paid if the company exceeds its EBITDA target.
Magyar Telekom aims to reduced total workforce management (TWM) related costs by HUF 9.5 billion in 2011 from HUF 115.5 billion - at the parent company and its subsidiaries - in 2009. (MTI-Econews)