Dutch unions abide strictly by pay freeze

Figures published last month by the Netherlands' central statistical office show that the pay freeze agreed by the unions, employers and government at the end of last year is starting to have an effect.

Agreed pay increases in the first quarter of the year were only 1.8%, the lowest figure since 1996 and well below the 2003 average of 2.8%. The reason there are any increases at all this year is that some settlements reached in 2003 and earlier included pay rises for this year.

The figures also show that negotiators are not making use of the possibility allowed in last year's agreement of one-off payments linked to specific developments.

Inflation in the Netherlands is currently running at 1.4% (April), so pay still increased in real terms during the first quarter of the year. As the pay freeze continues and the impact of previous settlements lessens, this is likely to change.