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Employment laws in Hungary

Learn about employment laws in Hungary, covering employment contract types, working hours, mandatory benefits, minimum wage, and employee rights in Hungary.

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The Labor Code (Act I of 2012) governs the employment landscape in Hungary, covering all the key employment areas. Employment laws in Hungary cover employment contracts, minimum wage, working hours, employee rights in Hungary, leaves and benefits, termination, and so on. 

Whether you are an employer or an employee, you must know the labor laws in Hungary. The regulations of the country align with the European Union’s directives. Hence, labor law compliance in Hungary is mandatory to ensure a structured and fair working environment.

Here, we will explore the key aspects of employment laws in Hungary. We will also see how Payoneer Workforce Management helps manage employee lifecycle processes, payroll management, compliance, and more. 

Key employment laws in Hungary

The Labor Code (Act I of 2012) is the primary statute governing all employment relationships in Hungary. 

Apart from the main Labor Code (Act I of 2012), there are other prominent employment laws in Hungary as well, similar to those in Portugal. Some of them are as follows:

  • Act XCIII of 1993 – Labor Safety Act: The Labor Safety Act is the primary legislation in Hungary that governs occupational safety and health. The act also ensures risk evaluation, employee training programs, and safe working conditions for the employees. 
  • Act LXXX of 1997 – Social Security Hungary: The Social Security Act is an important part of labor laws in Hungary, regulating social security contributions from the employee and the employer. It also covers areas like pension, healthcare, and other social security benefits. 
  • Act CXXV of 2003 – Equal Treatment and the Promotion of Equal Opportunities: This is the primary anti-discrimination legislation in Hungary. As is evident from the name, this act guarantees equal treatment and dignity for all. 

Contract employment laws in Hungary

Employment contracts in Hungary are included in the Labor Code (Act I of 2012). In Hungary, the employment contracts must be in writing, typically in Hungarian and English. It must contain all necessary contract terms in detail.

Types of contract

There are different kinds of employment contracts in Hungary. Some of them are as follows:

  • Indefinite-term contracts: It is clear from the name that these employment contracts are for an indefinite period. These are mainly for permanent employment. 
  • Fixed-term contracts: In these contracts, there is a specific start and end date of the employment. There are chances of renewal (if required) after the initial contract period expires. 

Essential contract terms

Here are some of the essential contract terms that must be present in employment contracts in Hungary:

  • Complete details of the employee and the employer
  • Probation period in Hungary
  • Type of employment contract
  • Date of commencement and ending (for fixed-term or temporary contracts) of the employment contract
  • Daily working hours with overtime hours
  • Roles and responsibilities of the employee
  • Wage/salary of the employee with other allowances, bonuses, and other benefits
  • Leave entitlement
  • Notice period
  • Termination 

Minimum wage in Hungary

Employees get their payment in Hungary in Forint (HUF). This is the payout currency in the country. 

In Hungary, the minimum wage is 290.800 HUF, and the hourly wage is 1.672 HUF.

Again, the qualified minimum wage in Hungary is 348.800 HUF, while the hourly wage is 2.005 HUF. 

Working hours in Hungary

The working hours in Hungary are mandated by the Labor Code (Act I of 2012). The general working hours in the country are 40 hours per week. 

There are strict overtime laws in Hungary, mentioned in the Labor Code (Act I of 2012). Here are the details:

  • Overtime per year cannot be more than 250 hours.
  • The employee receives 50% over the gross salary for the number of overtime hours worked. 
  • An additional 150 hours of overtime might be allowed to the employees. For this, there must be a written mutual agreement between the employee and employer. 

Mandatory benefits

When it comes to employee rights in Hungary, we have to mention the mandatory benefits that employees are entitled to. Here are some of the most important ones:

Mandatory benefitsDetails
Public health insuranceFor the majority of residents, public health insurance is mandatory in Hungary.

The National Health Insurance Fund (NEAK) oversees public health insurance in Hungary and offers coverage to employees.

Every child of the employee, whether attending kindergarten, school, or university, is insured. 
Social security benefitsIn Hungary, social security benefits are covered by Társadalombiztosítás – Tbj.

Social security offers coverage for pension, healthcare, family support, unemployment, and other social benefits. 
Sick leaveIn Hungary, employees are entitled to sick leave for 15 days. 
Maternity leavePregnant female employees in Hungary are entitled to maternity leave in the country for 24 weeks. 

They can take leave 4 weeks prior to the date of delivery. 

The remaining 20 weeks of leave can be taken after childbirth. 
Paternity leaveMale employees, who have become fathers, will get 10 days of paternity leave in Hungary. 
Annual bonusThere is no mandated annual bonus for employees in Hungary. 

However, employees can enjoy such a bonus at the employer’s discretion. 
Annual leave and public holidaysThere are a basic 20 days of annual leave in Hungary for employees.  

However, the number of leave days increases with age. It is as follows:

From 25 year + 1 day = 21 days
From 28 year + 2 days = 22 days
From 31 year + 3 days = 23 days
From 33 year + 4 days = 24 days
From 35 year + 5 days = 25 days
From 37 year + 6 days = 26 days
From 39 year + 7 days = 27 days
From 41 year + 8 days = 28 days
From 43 year + 9 days = 29 days
From 45 year + 10 days = 30 days

Employees are also entitled to additional annual leave if they have children:

1 child + 2 days
2 children + 4 days
More than 2 children + 7 days

In Hungary, employees can enjoy 11 days of public holidays in the country. 

In 2026, the list of public holidays for Hungary is as follows:

1st January – New Year’s Day
3rd April – Good Friday
6th April – Easter Monday
1st May – Labor Day
25th May – Whit Monday
1st July – Semmelweis Day
20th August – State Foundation Day
23rd October – Republic Day
25th December – Christmas Day
26th December – 2nd day of Christmas

Termination

Termination laws in Hungary are clearly mentioned in the Labor Code (Act I of 2012). To terminate employees in Hungary, employers must have a solid ground and a valid reason. Unfair dismissal of the employee can lead to serious consequences for the employer, including legal hassles. 

Types of termination scenarios

Termination of employees in Hungary can take place in the following scenarios:

  • Termination during the probationary period
  • Resignation of the employee
  • Termination by the employer due to poor performance, misconduct, absence without leave, etc. 

Notice period in Hungary

When an employee is in the probation period in Hungary, there is no need to serve a notice period. 

However, once the probation period is over, employees have to serve a minimum of 30 days’ notice period in Hungary. However, the extension of the notice period in the country depends on the employment duration. In certain cases, the notice period can extend up to almost 6 months. 

Service tenureNotice period
Up to 2 years30 days
3 years35 days
5 years50 days
10 years55 days
15 years60 days
18 years70 days
20 years90 days

Severance payable 

  • Employees are entitled to severance pay in Hungary. For that, they have to complete 3 years of service. 
  • Severance pay is mandatory in Hungary and varies between 1 and 6 months’ salaries. 
  • The severance pay amount also depends on the age of the employee and the length of the service offered. 

Navigating the employment laws in Hungary might not seem easy for many employers. This might hamper labor law compliance in Hungary, potentially leading to legal consequences, including penalties for the employer. 

Payoneer Workforce Management, a trusted workforce management platform, helps employers engage talent without a local entity and understand labor laws in Hungary to comply with the regulations. 

Along with assistance in compliance, the platform also extends support for onboarding talent, payroll management, benefit entitlements of employees, taxation, leave management, and more. 

Book a demo today!

Frequently asked questions (FAQs)

Understanding the intricacies of employment laws in Hungary might be slightly difficult for many employers. Payoneer Workforce Management helps navigate the labor laws in Hungary. The workforce management platform assists with onboarding, payroll, labor law compliance in Hungary, and more.

The maximum probation period in Hungary is up to 3 months. This period cannot be further extended by any employer. 

Employment in Hungary is primarily governed by Act I of 2012, known as the Labour Code. It covers contracts, working hours, wages, leave, termination, and employee rights, applying to all employers and employees operating within Hungary. 

Yes, employment contracts in Hungary must be in writing, in Hungarian and English. The contract must include the employee’s position and base wage as essential terms. Verbal agreements are not considered legally valid in the country. 

Yes, employees are entitled to severance pay in Hungary. To be eligible, the employee has to complete 3 years of service. The pay varies between 1 and 6 months’ salaries. The age of the employee and the length of the service also determine the severance pay in the country. 

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