Increasing wages, Prime Minister Bohuslav Sobotka has made clear, will be a key campaign theme for his Social Democrats in what is an election year; on Tuesday, he suggested with the mandate the government has left he will boost pressure on foreign owners of Czech firms to increase wages. Salaries in the Czech Republic are still seen as generally lower than what might have been expected 27 years after the fall of communism.
Prime Minister Bohuslav Sobotka says he would like to see the minimum wage rise to 40 percent of the average wage from next year. Mr. Sobotka made the comment after talks with union leaders on Tuesday. The average monthly wage in the Czech Republic was CZK 29,300 in the final quarter of last year. The head of the congress of trade unions, Josef Středula, said his organisation was advocating for the minimum wage to increase to at least CZK 12,500 a month from 2018. At present the figure is CZK 11,000.
The Ostrava-based company Vítkovice Power Engineering which is undergoing reorganization under forced administration, is having to lay off around 300 employees. Most of them are currently employed at the VPE Hard daughter company which is being sold off. Vitkovice Power Engeneering had close to 1,500 employees when it came under forced administration in 2016 and is now down to just over 800 with further lay-offs in the pipeline. The company narrowly avoided bankruptcy at the end of 2015 after admitting it had over 700 creditors to whom it owed hundreds of millions of crowns.
Unemployment in the Czech Republic dropped to 4.8 percent in March down from 5.1 percent a month earlier. Some 356,112 people were without jobs last month – the lowest figure for March since 2008. Available jobs counted almost 151,000. Experts at the Labour Office expect the unemployment rate to continue falling in the months ahead.
A strike by bus drivers began at midnight on Wednesday with five regions, mostly in the north and east of the country mainly affected. The biggest impact appears to have been in South Moravia where it was reported that 67 routes were cancelled and buses on another 61 routes reduced. The regional government subsidies 225 routes in total. The strike was reported to be much more patchy in the Olomouc, Liberec, and Ústí regions. The government on Wednesday night offered regions 420 million crowns to boost pay for drivers but this is less than half what might be required. The strike was sparked when some regional operators failed to honour a government promise for minimum wages to be boosted to 98.10 crowns an hour for drivers behind the wheel.
The US firm Alcentra has written to the Czech prime minister offering to pay at least 500 million crowns for the hard coal mining company OKD. The news was reported by the business server, Euro. Alcentra, part of the BNY Mellon group also though threatened to start arbitration proceedings if its offer was ignored. It is reported to be angered that a state company might get OKD’s assets for just 80 million crowns. The OKD mining company has been in insolvency since last year with managers seeking a strategic investor. Previously EP Industries, owned by Czech billionaire Daniel Kretinský, and a multinational hedge fund were reported to be interested. The government is hoping for a gradual wind down of mining in the far east of the country with a buyer taking responsibility for the process.
In the first quarter of 2017, the Czech consulate in Lvov, Ukraine received almost 4,000 applications from Ukrainians looking to work in the Czech Republic, a number three times higher than the entire number of applications one year earlier. Domestic firms have made no secret of their interest in hiring Ukrainian labour, an initiative backed by the government and also the president. But organization has been a different matter: processing applications has been altogether too slow.
Employees of the second-biggest carmaker in the Czech Republic, Huyndai, will get a pay rise of around 12 percent, the company’s spokesman Petr Vaněk told the Czech News Agency on Tuesday. The deal is part of a collective agreement signed by the unions and representatives of the company’s management. Last year, blue collar workers in Hyundai made on average 34,500 crowns. The average wage in the Moravian-Silesian region, where the plant is located, was around 25,200 crowns last year.
The Association of Regions in the Czech Republic has called on the government to provide regions with funds agreed for bus drivers and transport companies. The chairwoman of the association, governor of the region of Karlovy Vary, Jana Vildumetzová, confirmed the news on Friday after the association’s board meeting, pointing to Prime Minister Bohuslav Sobotka’s promise the funds would be earmarked. The addenda - approved by the government last year - was to see minimal wages for bus drivers raised by around one-third, to 98.10 crowns per hour (the equivalent of around 3.6 euros).