Hungary – National Regulations in Employment Law

We, the International Labour and Employment Group of Rödl & Partner, are happy to advise you on labour law issues (individual and collective) as well as social security law issues on a global, regional and local level.

Below you will find basic information on national labour law provisions in Hungary.

Interview with Elena Loucaides

Are there national and/or local collective agreements in the country that regulate labour relations?

Yes. In Hungarian practice, so-called employer-level collective agreements have become widespread: these are concluded by the employer with the trade union/trade unions having the capacity to conclude collective agreements, namely to regulate the labour relations existing with the employer and the rights and obligations therein.

Are there different legal rules by department/canton?

No. See the answer above.

Is there and what is the staff threshold above which the presence of staff representatives is mandatory?

Yes. Employees shall be represented by the shop steward, the works council, central works council, or the corporate-level works council. There are different thresholds for more than 15 and for more than 50 employees.

Are trade unions present in the company?

Not compulsory. Hungarian employees have the right to form a trade union. Each employee is free to decide whether or not to become a member of a a trade union and, consequently, to leave the trade union at any time. The employer has a duty to guarantee the possibility for a trade union within the work organisation to operate.

If applicable what is the applicable legal working time?

The general daily working time (in full time jobs) is 8 hours and the work shall be scheduled for five days a week, from Monday until Friday (general working order). Working time can also be unequally scheduled if the employer applies an unequal working time schedule (e.g. working time frame or settlement period).

The shortest worktime may be 4 hours/day (unless the employee is employed part-time because it can be shorter than that) and the longest 12 hours.

The max. 12 working hours a day already includes overtime.

Is there a minimum wage set by law/collective agreements (yes/no)?

Yes. A government decree defines every year the amount of the mandatory minimum wage and - in case of employees employed in a position requiring at least upper secondary education/qualification – the amount of the mandatory guaranteed minimum wage.

What is the number of legal annual paid holidays?

The basic vacation time of the Employee shall be 20 working day. The employee may be entitled to additional vacation depending on her/his age and other circumstances like children, disabilities, etc..

Existence of specific classification of employees according to their functions/responsibilities?

Yes. Special rules of labour law for employees in a leading position (“Executive employee”).

Obligation to set up complementary social insurance schemes (mutual insurance/provident fund/pension)?

Yes. Employees’ contributions (i.e. personal income tax and social security contributions) are automatically deducted from their gross wages. Further, the social security tax is

payable by the employer in addition to the employer's gross salary.