In order to reduce the effects of the global financial and steel industrial crisis and to maintain the operation at the company group, ISD Dunaferr Co. Ltd. prepared an action plan that will be executed step by step. Beyond reduction of production and operation related costs and reschedule of investments by making priorities, it was necessary to limit social benefits for half a year and postpone or reschedule the payment of other benefits, which are more favourable than the obligatory payments regulated by the Labour Code.  As a result of difficult negotiation rounds a necessary compromise agreement was reached between the interest representation organisations and the employer.

In order to reduce the effects of the global financial and steel industrial crisis the action plan - approved at the end of October 2008 - includes necessary solutions and measures, which are extended to all operational fields of ISD Dunaferr Company Group. The action plan constitute of three main parts including rational cost reduction measures not endangering safe operation, reschedule of investments by making priorities and handling social issues concerning the employees. Regarding restrictive measures in connection with the social issues required close cooperation with the interest representation organisations, as a far more favourable benefit system is effective at the company group than it is regulated by the Labour Code, a benefit system included by the Collective Labour Agreement.
Even under today's difficult circumstances the highest priority at ISD Dunaferr Co. Ltd. is to maintain employment. In course of the negotiations both the interest representation organisations and the representatives of the employer had this priority in mind. The negotiating parties made all necessary decisions, on the basis of which certain provisions of the Collective Labour Agreement were temporarily amended for a determined period.
They agreed on suspending the regulations of the Collective Labour Agreement concerning employment on stand-by basis and employment in reduced working hours between 1 December 2008 and 31 May 2009 and will apply the relevant regulations included by the Labour Code during this period. Especially important element of this decision was the issue of the shift benefit that resulted in maintaining a 30% higher shift benefit than the one regulated by the Labour Code, even if it will be regulated individually.
For the above mentioned period salaries concerning transferred and replaced employees will be individually regulated by the agreement reached by the interest representation organisations and the employer.
Important part of the agreement is next year's salary increase that will be executed earliest 1 July 2009 considering the middle-term salary agreements concluded for the period between 2008 and 2011.  The extent of the salary increase is determined to be equal to the forecasted inflation rate of +1.05% included by the approved Act on Budget.
The agreement includes the payment terms of the Christmas salary of year 2008 as well stating that all employees - entitled to the 14th month salary called Christmas salary - will receive HUF 140,000.00 till 10 December 2008. Consequently, employees having lower salary than HUF 140,000.00 will receive an amount equal to their salary as Christmas salary. The remaining part of the Christmas salary will be paid by the employer till 31 October 2009.
At ISD Dunaferr Company Group all additional performances will be acknowledged by providing additional benefits resulting in payment of incentives in case of a profitable economy. The signed agreement makes it possible to comply with the payment obligation of year 2008 - occurring normally after the approval of the General Meeting closing the given financial year - till 31 October 2009. Present amendment of the Collective Labour Agreement also regulates the issues of home loan, meal-ticket, lunch, so called OMB, Core Workforce Insurance Policy, pension and health care foundation paid by the employer and regulations of the benefit system connected to the Core Workforce reward.

Valeriy Naumenko, Chief Executive Officer - evaluating the results of the difficult negotiation rounds - said: "The employer, the interest representation organisations and all employees have to perform well in a difficult situation, when maintaining the operation and the employment are at stake." We completed long and requiring negotiations, where the objective of both parties was the same: survive the crisis. The Trade Unions were representing the well-founded interests of the employees by searching for the solution in a constructive way. Herewith I would like to thank the cooperation of the representative trade unions and the employees, because they gave evidence of an exemplary solidarity in favour of our future."

The interest representation organisations showed their responsibility as well.

Mucsi Zoltán, Chairman of Dunaferr Vasas Trade Union Association, said: "It was a hard decision to make, because we had to negotiate by making a decision that would result in the least possible limitations. At this time the trade union could not bring forth any benefits as some social benefits were already permanently limited by present agreement. Our main aspect was to maintain employment. We subordinated everything to this objective. I can proudly announce that we achieved significant and great results compared to the original conception of the employer. It was a painful decision, which will prove to be good in the future. Dunaferr survived several crises already, but always managed to find the solution based on the team-work between the employees and the managers. We need to do the same today. Good Luck!"

Csapó Tamás, Chairman of Dunaferr Youth Organisation, said: "I had a strange feeling about the negotiations, because I experienced a reversed salary negotiation. Now the employer had requests and we would not to come round willingly. But looking at the global issues we had to be guided by our intelligence, because this crisis could not be avoided by ISD Dunaferr either. I hope that the problems will be solved before July next year."