The process of reconciliation between the government and four public-sector unions over a proposed annex to the Basic Collective Agreement ended in failure on Saturday, after which the government announced that it would cancel the agreement and possibly cut salaries for employees in the education, science, culture, health and social welfare sectors.
The unions of primary and secondary school teachers, university teachers, employees of scientific institutions, and nurses refused to sign the annex to the Basic Collective Agreement and thus agree to a reduction of their entitlements in exchange for preserving their salaries, after a vast majority of their members rejected the government's proposal in a referendum.
The existing Basic Collective Agreement will remain in force for another three months after which talks will begin on a new one.
The government will use its powers to save an additional 700 million kuna in the budget by cutting costs for employees of the public and state services, Labour and Pension System Minister Mirando Mrsic told the press after the meeting. He would not say whether this meant that salaries of public service employees would be reduced by 10% as announced earlier.
The government can reduce salaries for all employees in the education, science, culture, health and social welfare sectors by 10%, or only the salaries of the "disobedient" services without touching those who agreed to give up their perks.
According to announcements from the government, the public service unions will be offered the same kind of agreement as was signed by the state administration unions: they would remain without two Christmas bonuses and a holiday cash grant and would receive lower per diems and transport allowances in exchange for preserving their salaries, a four-year Basic Collective Agreement and the possibility of negotiating an increase of entitlements after Croatia overcomes the recession.
The meeting took place in an atmosphere of raised voices, with the leader of the Matica union, Vilim Ribic, calling the government negotiators "nerds" who were unable to make any decisions without Finance Minister Slavko Linic.
The chief government negotiator, Deputy Prime Minister Neven Mimica, responded to Ribic by saying that he considered the unions as partners in collective bargaining, but that he could not agree to their demand for the retroactive payment of their entitlements. He said that the type of language used by Ribic could not contribute to their partnership or social dialogue.
