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Changes to the Labour Code effective as of 1 January 2023 and what employers should be aware of

The new provisions of the Act on the Labour Code (Labour Code) effective as of 1 January 2023 were published in the 21 December 2022 issue of the Hungarian Gazette, which turned out to be somewhat of a Christmas present for employers, payroll staff and labour lawyers in the form of administrative duties for the new year. Below we would like to summarise the most important changes to the Labour Code from the employers’ perspective.

Changes to the rules of evidence relating to violations of the prohibition of abuse of rights

Changes have been made to the rules of evidence that apply when enforcing labour claims based on a violation of the prohibition of abuse of rights. From now on, for infringements taking place after the entry into force of the new Labour Code, the burden of proof will be split between the employee and the employer.

This rule will primarily be relevant in cases where an employee objects to the termination of their employment on the grounds that the real reason for termination is not the one specified in the termination letter.

This includes cases where the employee criticised their employer, requested a paternity leave or caregiver leave, or perhaps requested an amendment to their employment contract to transform it into a part-time contract or to change their place of work to reflect a work-from-home arrangement.

New deadlines in the Labour Code for giving notice on termination and on changes in the employer

The legal practice that, in cases where a notice of termination with immediate effect is given after the probationary period ends, the 15-day deadline for giving notice must be treated as met if the employer mails the notice of termination with immediate effect on the 15th day, became legislation.

From now on, this rule also applies in cases where, due to a suspicion of an abuse of rights, the employee requests their employer to give a reason for a termination without cause within 15 days (e.g. during the probationary period or in the case of employees who are pensioners).

Similarly, the same applies if an employee requests an amendment to their employment contract for reasons involving their child under the age of eight. An identical rule was put in place regarding representations to be made before a specific deadline; for instance, in case of a termination with immediate effect during the probationary period, mailing the termination letter on the last day of the probationary period is sufficient, which is contrary to the previously adopted practice.

The deadline for the mandatory communication of the employer’s identification data in the event of a change in the employer was also modified, and the deadline for such communication is now the date of the transfer instead of the 15th day after such transfer.

New obligations for employers to provide information

Employers are now subject to new obligations to provide information under the Labour Code, and the deadline for providing such information was reduced from 15 days from the start of employment to 7 days.

The new areas that newly hired employees must be informed about (perhaps even by referring to the specific regulation pertaining to the employment contract, as the case may be) include:

  • days of the week to which work hours may be assigned,
  • the possible start time and end time of scheduled work hours on a given day,
  • the possible duration of extraordinary work hours and any special features of the employer’s operations (e.g. work in multiple shifts or uninterrupted operations),
  • the employer’s training policy and the time available to employees for training, and
  • the name of the authority to which the taxes and contributions associated with the employment contract are paid by the employer (which, in this case, is simply the Hungarian Tax Authority).

In connection with the above, employers are not required to provide information on work-related terms which have been explicitly agreed on by the parties in writing (typically in the employment contract).

Changes to employees’ obligation to be available for work

A minor but important change is that employees who lawfully disobey their employer’s orders in the cases regulated by the Civil Code are not required to be available for work, with the exception of orders concerning the duration of the obligation to be available for work. This means that, if the reason for disobeying orders is that the work schedule provided by the employer violates the provisions of the Labour Code, the employee may refuse to be available for work.

Under the Labour Code, there are three new cases where employees may be relieved of their obligation to work and to be available for work:

  • if they are unable to perform their duties for medical reasons,
  • for a period of absence justified by exceptional circumstances involving personal, family or unavoidable reasons, and 
  • for the purpose of personal care for a relative who requires care for a serious medical condition or a person living in the same household as the employee, for up to five workdays per year.

Termination without cause, but with an obligation to give a reason

It should be interesting to see how the legal practice develops in connection with the new rule that, in certain cases, employers must  subsequently give a reason for termination at the employee’s request, even in the absence of an obligation to do so. These may include, for instance, cases involving notices with immediate effect during the probationary period, or the termination of the employment of senior-level employees, pensioners or employees with fixed-term employment contracts. An employee may request their employer to subsequently give a reason if they believe that an abuse of rights has taken place, including, in particular, cases where the employee’s employment contract was terminated because they requested a caregiver leave, paternity leave or parental leave, requested an amendment to their employment contract or asked for unpaid leave to care for their child.

New types of leave: paternity leave and parental leave

Two new types of leave (paternity leave and parental leave) were introduced to the Labour Code. A father is eligible for paternity leave until the end of the second month following the birth or permanent adoption of his child. An employee may use his paternity leave until 28 February 2023 for a child born or adopted between 2 August 2022 and 31 December 2022 if he didn’t use up all of his paternity leave for 2022. Paternity leave is 10 workdays and must be granted at the time requested by the father in two parts at most, and may even be granted beyond the year of eligibility.

The amount of the benefit for the paternity leave equals the absence fee for the first five days and 40% of the absence fee from the sixth day onwards. When the employment contract is terminated, unused paternity leave cannot be exchanged for payment in lieu of holiday, but can be carried over by the employee to his next employer using a certificate issued by the employer to that end.

Parental leave is available to employees until their child turns three, for up to 44 workdays per year, and is granted only if the employment contract has been in place for at least one year. This type of leave does not need to be granted in the year of eligibility, either. If an employee’s child turns three between 2 August 2022 and 30 June 2023, then such employee may go on parental leave until 30 June 2023 at the latest. Employers must approve parental leave for the dates requested by their employees. Employees must notify their employers of their request at least fifteen days before the start of the leave.

Employees are eligible for 10% of the absence fee for the duration of their parental leave, which is to be reduced by the amount of childcare benefit and childcare support allowance received.

The new types of leave also mean new prohibitions concerning the termination of employment, as employers may not terminate their employees’ employment during paternity leave, parental leave and caregiver leave.

Flexible work arrangements for employees raising children

The new cases of amendments to employment contracts are favourable for those raising children under the age of eight since they may, in writing, request changes to their place of work or work schedule, or request remote working or part-time arrangements, provided that their employment contract has been in place for at least six months and a proper explanation is given.

The employer must respond to the employee’s request in writing within 15 days and, if the request is rejected, a reason must be given. In the event of an unlawful rejection of their request or the absence of a response, the employee may take legal action, requesting that an approval be issued by the employer.

Other changes

In cases where a fixed-term employment contract is extended or an employment contract is re-instated within six months from its termination, no probationary period may be implemented if the line of work is the same as before or similar, and the duration of the probationary period must be reduced in a prorated manner for employment contracts concluded for a period of no more than 12 months. Probationary periods longer than the prorated duration are invalid.


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