Hondutel Agrees to 20% Pay Raise

Wednesday, January 23, 2002

Honduras' state-run telco Hondutel has agreed to award its employees a 20% annual pay rise, for the next three years, Honduran daily Tiempo reported, citing Wilfredo Galeas, head of the Hondutel workers' union Sitratel.

"Honduras is making the capitalization of Hondutel much harder and should follow the example of Paraguay, where the government has decided to take on pension plans and severance payment for people it is laying off, making the process much more attractive," Pyramid Research analyst Leslie Arathoon told BNamericas.

"Companies like Hondutel have some of the worst employee-line ratios, as is the case with all government owned companies. They have to have some layoffs. Labor costs are always a huge issue for incoming operators (in privatizations)." she said.

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Hondutel has about 310,000 installed lines.