CLEANER

All non-EU citizens must have a work visa and work permit to live and work in Hungary. As the employer, you’re responsible for the majority of the process, including providing documents to the immigration authorities. Some of the options include:

• Individual work permits: Foreign nationals wanting to work in Hungary for no more than 90 days over 180 days should apply for an individual work permit.

• Joint work permits: Joint work permits are for foreign nationals intending to work in Hungary for more than 90 days within 180 days.

• Residence permits: Residence permits, also known as tartózkodási engedély, permit residency for up to 90 days.

• Single application procedure: A third-country national can stay in Hungary for more than 90 days but less than 180 days through the single application procedure. This permit is based on an employment relationship with a Hungarian employer.

In addition to a work permit, your employees will need a Hungary work visa. Available visa types follow:

• Seasonal employment visa: Anyone working in agriculture, horticulture, animal husbandry, or fishing must have a work permit and a seasonal employment visa. This visa counts for both single and multiple entries and allows the applicant to work for greater than three but fewer than six months.

• EU Blue Card: Any high-skill worker from an EU member country can get an EU Blue Card as long as they also have a residence permit. They’ll need to prove 18 months of lawful stay in a member state to be eligible.

• Schengen business visa: Non-European citizens traveling to a Schengen country for short-term business purposes can get this visa for single or multiple entries. It allows holders to stay in the country for 90 days over six months.

• Working Schengen visa: Anyone traveling to Hungary for short-term employment opportunities should apply for this visa.

You must obtain work permits on behalf of all employees after meeting numerous requirements. First, advertise the job in the Hungarian Labor Office for 15 days to allow unemployed Hungarian nationals to apply. Then, submit a valid manpower request to the regional branch of the labor center. Hungary has quotas for foreign employees, and your number of work permits for foreigners cannot exceed the average number of workers requested by employers during the previous year.

From there, you can follow the general or simplified procedure. The labor center will make a final decision on whether you can get the work permit within 10 to 30 days of you applying. Once it’s approved, you’ll get a resolution issued by the labor center.

The Hungarian labor code gives strong protection to employees. There are specific rules and procedures that must be followed in cases of termination, illness, or maternity benefits, and companies can be fined and sanctioned if they do not follow the statutes. Both collective bargaining and works councils, which represent employees, are permitted.

When negotiating the terms of an employment contract with an employee in Hungary, it may be useful to keep the following standard benefits in Hungary in mind:

The general rule in Hungary is that employment contracts are executed for an indefinite duration. Fixed-term contracts are also allowed if they are for temporary or seasonal work.

Employment contracts must be in writing, in the local language, and must include the terms of the employee’s compensation, benefits, responsibilities, hours and holidays, probation period, and job title. It is best practice to also include termination requirements. An offer letter and employment contract in Hungary should always state the salary and any compensation amounts in Hungarian forint rather than a foreign currency.

The standard work week in Hungary consists of up to 8 hours a day, 5 days a week. Employees can work no more than 250 hours in overtime per year and must be paid 50% on top of gross salary for overtime hours worked. 

Hungary celebrates 10 public holidays for which employees are given the day off, including:

• New Year’s Day

• Revolution Day

• Easter Monday

• Labor Day

• Whit Monday

• Saint Stephen’s Day

• Republic Day

• All Saints’ Day

• Christmas Day

• Second Day of Christmas

Employees in Hungary are entitled to at least 20 days off per year. The amount increases based on the age of the employee as follows:

• Up to the Age of 25: 20 business days

• From the Age of 25: 21 business days

• Up to the Age of 31: an additional business day every 3 years

• Up to the Age of 45: an additional business day every 2 years

• From the Age of 45: 30 business days

An employee is entitled to 15 sick days annually while enrolled in the national social security system. Employees generally receive 70% of their salary which is paid by the employer. After 15 days, the amount paid varies from 50% – 60% depending on the term of service. One third is paid by the employer and the remaining amount is paid by the state.

If an employee is unable to work due to a work related accident or occupational illness for 4 days or more but less than 3 months, the employer must pay the injured employee at a rate of pay of at least 75% from the first day of injury until the employee returns to work. If the employee is unable to work for a period longer than 3 months, the employee must claim compensation from the Compensation Fund.

Pregnant employees are entitled to 24 weeks of maternity leave (CSED). The leave must start at least 4 weeks prior to the scheduled delivery date. The amount of the childcare fee per calendar day is 100% of the calendar day’s base or the calendar day’s income. The amount determined in this way is the gross amount subject to personal income tax, taking into account the tax benefits, the personal income tax advance is deducted by the body determining the benefit. No social security contributions are payable after this amount.

The father is entitled to 10 days off for paternity leave no later than the end of the second month following the childbirth or adoption, which must be granted at a time appropriate to his request, in no more than two parts. For the first 5 days, he is entitled to an absence fee, during days 6-10 he is entitled to 40% of the absence fee.

Parental Leave: One parent is entitled to take additional leave until the child reaches 2 years of age. The amount paid is 70% of previous earnings, however, the amount cannot exceed 70% of twice the minimum daily wage. One parent is also entitled to extra annual paid time off, 2 days for 1 child, 4 days for 2 children, or 7 days for more than 2 children under 16 years of age.

The employee is eligible for 44 working days of parental leave until the child’s 3rd birthday provided that the employee has one year of employment at the company – not necessarily at the time of the childbirth or adoption, if this requirement is met later, the employee can claim the parental leave. The employee receives a 10% of absence fee during the parental leave and cannot be eligible if receives CSED, GYED, or GYES.

Hungary provides full medical coverage to all citizens, with payroll contributions as one source of funding.  The government pays contributions for certain groups such as the unemployed and pensioners. 

The 13th month bonus is not mandatory in Hungary, however, performance based bonuses are common. 

The employer can set a probationary period in the employment contract. Local labor laws do not specify the maximum probationary period, however, it must be reasonable given the circumstances of the job.

When terminating employment, either party must provide a notice period of at least 30 days but no more than one year. The 30-day notice period must be extended by the following amounts:

• 5 days after 3 years of employment

• 15 days after 5 years of employment

• 20 days after 8 years of employment

• 25 days after 10 years of employment

• 30 days after 15 years of employment

• 40 days after 18 years of employment

• 60 days after 20 years of employment

The employee is entitled to severance pay if the employer terminates the employment by ordinary termination (as a result of the employee’s ability, behavior in relation to the employment relationship or the employer’s operations or economic reasons). The following payments apply:

• 1 month for up to 3 years of employment

• 2 months for up to 5 years of employment

• 3 months for up to 10 years of employment

• 4 months for up to 15 years of employment

• 5 months for up to 20 years of employment

• 6 months for up to 25 years of employment

The amount of severance pay is increased by 3 months if the employee is terminated within 5 years of his/her eligibility for old age pension or old age pension with age allowance.

The employer’s statutory social security contribution is 15.5% of gross salary. The employee’s contribution is 18.5% –  10% for social security and 7% for health insurance and 1.5% unemployment contribution.

This information is provided as generally accepted information and is not intended as advisory services.