MT, unions agree on 15% cut in workforce

Hungary’s largest telecoms company Magyar Telekom (MT) has agreed terms with unions representing its workers to cut its workforce by 15% by the end of 2008, resulting in a 5% saving in employees’ costs. The move is expected to cost HUF24 billion (USD135 million) in severance payments in fiscal year 2007; payments in 1H 2007 for redundancies amounted to HUF7.3 billion. However, the decision will result in savings of HUF13 billion at a group level, going forward. Deutsche Telekom-controlled MT and the unions also agreed a pay rise of 5.5% effective from March 2008.