The long-awaited reform of the complex system of public sector wages is gradually taking shape. The government appears to have opted for a gradual approach and guidelines confirmed last week show that some steps will not be completed until 2027, a timeline that trade unions find problematic.

While the plan is to have the bill in parliamentary procedure in July at the latest so that it can enter into effect as of 2024, only the bottom third of the wage brackets would be translated to the new system in 2025 and the rest in 2026. For the top brackets, the new system would not enter into force until 1 January 2027.

One of the key aspects of the new system is that the bottom bracket would correspond to the minimum wage, currently at EUR 1,203 gross. At present the bottom 14 brackets are below minimum wage, but this is the base pay and the actual take-home pay is above minimum wage.

The top bracket, reserved for office holders such as the president and the prime minister, would have a base pay of EUR 8,465 gross, up from under EUR 6,000 at present, show guidelines obtained by the STA.

Profound changes planned

The government has repeatedly said that the reform, the outlines of which were first presented in February, would entail more than just increasing the wage bill and there are several solutions proposed that upend the current system.

For example, seniority would count for less and there would be less automatism in promotions. Junior staff would be able to advance along the career path more quickly and get temporary wage increase for special tasks and when they lead special projects.

The system of bonuses would be rejigged to prioritise results and performance as key criteria. Performance bonuses would amount to roughly 5% of the wage bill.

The current system is a single set of rules applicable across the entire range of public sector professions, from civil servants to doctors and soldiers, which has often proved problematic due to the vastly different nature of the various professions it covers.

And since its inception a decade and a half ago, the system has seen piecemeal changes, due largely to strikes by different professions over the years, so many times it is barely still holding together.

The new system introduces five tiers - office holders; civil servants and persons with official authority such as police officers and soldiers; health and social care; research, education and culture; and workers in public institutes and publicly owned companies - with slightly different rules within each tier.

Trade unions displeased

The plan has been met with dismay by public sector trade unions, which have described it as a major departure from what the Public Administration Ministry had promised, in particular when it comes to the timeline.

"This is very much unlike what the government forecast. And of course it is far from the deadlines we thought these changes should take effect," Jakob Počivavšek, who heads one of two groups of public sector trade unions negotiating with the government, told the STA on Monday.

Public Administration Minister Sanja Ajanović Hovnik retorted that reform of the system was a multi-step process, the first of which would be to address existing wage disparities.

"Perhaps these guidelines are more hashed out than the guidelines we presented during the last round [of negotiations], but in fact they follow everything I presented in the analysis of the current situation," she said.

The guidelines will be officially presented to trade unions next week, when negotiations are expected to start in earnest.