IMPORTANT CHANGES IN THE HUNGARIAN LABOUR CODE

19 January 2023

At the beginning of the year, several important provisions of the Labour Code were amended, and the changes affect all employers in Hungary. It is recommended for the employers to review whether the labour templates, policies and HR processes of company comply with the amended rules. In our article, we describe the main changes by providing a non-exhaustive summary.

1. Expanding the content of information to be given to employees

The employers already had to inform the employees about the essential conditions when establishing the employment relationship (e.g. working hours, benefits, leave, exercise of employer's rights, etc...).[1]

As a result of the amendment, the content of the mandatory information has been expanded, with effect from January, for example, new employees must also be informed about the following[2]:

• the possible start and end times of the daily working hours
• the possible duration of extraordinary working hours, the specific nature of the employer's activity
• the employer's training policy, the duration of the training available to the employee (e.g. mandatory workplace training)
• the authority to which the employer pays the public burden related to the employment relationship.

It is important to mention that the information shall be provided as personalized as possible, general references to internal policies should be avoided.

In case of employees whose employment started before 2023, it is necessary to supplement the previous information only if the employee requests it by 31 March 2023, in which case the employer has 30 days to provide the employee with the supplemented information.

Employees must also be informed when any data that is part of the extended information obligation changes, thus, although the law does not specifically require it, it may be worthwhile to update the information also for existing employees in accordance with the amended regulations.

2. Paternity leave

According to the new rules, the father is entitled to 10 working days of leave in the event of the birth or adoption of a child. The leave must be issued upon request, within two months of the birth or adoption, at the requested time, in a maximum of two instalments[3]. The definition of “father” is described at the end of LC, among the closing provisions.

3. Parental leave

The employee (both parents) is entitled to forty-four working days of parental leave until the child is three years old. The condition for taking parental leave is that the employment relationship has existed for at least one year at the time of the child's birth or adoption[4]. The employer grants the parental leave at a time corresponding to the employee's request.

4. Exemption from work due to care activities

The employee is exempted from fulfilling his obligation to be available and to work for a maximum of five working days per year in order to provide personal care to a relative in need of care due to serious health reasons or to a person living in the same household as the employee[5].

The exemption must be provided at a time corresponding to the employee's request, in a maximum of two instalments.

5. Initiating the amendment of the Contract

The employers are obliged to inform the employees about the interoperability between atypical and typical forms of work, i.e.

• what opportunities are available at the company for certain atypical forms of work (e.g. is it possible to work part-time or telework);
• or vice versa, how can the employee switch to "typical" work (can the company offer an indefinite-term contract to an employee hired for a fixed period of time).[6]

Based on the above information, the employee can request the modification of his/her employment contract with regard to the mentioned conditions.

In addition, employees raising a child under the age of eight years can request that the employer provide them with "flexible working conditions" regarding the place of work, work schedule, and working hours[7].

The essence of the new regulation is that if the employee requests the amendment to the employment contract, the employer must provide a reasoned answer within 15 days. In connection with the reasoning, the same strict rules apply as in case of termination of employment. The employee may challenge the rejection of the request before the labour court, if the court considers that the request was rejected unlawfully (i.e. the justification is inadequate), the consent to the amendment will be declared by the court.[8]

6. Other changes

With effect from January, many detailed rules have been changed in Labour Code, on the one hand, in connection with the innovations already described, but also in connection with other, various topics:

• information rules in case of working abroad for more than 15 days;
• incapacity to perform the job due to health reasons results in exemption from work, during which the employer is not obliged to pay wages or absence fees (except in the case of “sick pay”);
• the employee can request the restoration of the employment relationship if the termination of the employment relationship violated the prohibition of abuse of rights
• detailed rules related to the issuance, payroll and certification of paternity leave and parental leave;
• the start and end date of the working time frame, as well as the duration of the working time to be fulfilled in the working time frame, must be determined in writing and published;
• the employer may refuse to grant leave at the time requested by the employee in the case of an exceptionally important economic interest or a reason that directly and seriously affects its operations;
• in the case of an employment relationship established for a period of less than 12 months, the duration of the trial period must be determined proportionally.

The amendment to the Labour Code applicable from January 1, 2023 affects all employers, it is recommended to revise the templates, regulations, and HR processes related to the employment relationships. Although the changes summarized above were covered in numerous newspaper articles, for the sake of full compliance, we recommend contacting a legal expert with experience in labour law to carry out the necessary review or if any labour law question arises.