Government rejects unions' demand for 4 pct salary increase

The government stood by its proposal that base salaries could not be increased by more than 2 percent, union leader, Zeljko Stipic, told reporters after the meeting.

The unions want Plenkovic to step in, arguing that the amount of money in question was not so large that a compromise solution could not be reached. Unless he responds to their demand, they announced they might take industrial action after the upcoming Easter holidays.

"All unions agree with this," Stipic said.

All 11 public sector unions rejected the government's offer of a 2 percent raise which would have come into effect on 1 April.

Since the latest data on inflation shows that prices have increased by 6.3 percent year-on-year, the unions continue to insist on a 4 percent raise and on further talks in late May on "further raises in the second half of the year, depending on inflation, other salaries in the country, and the economic situation," the unions said in a press release.