Hungary : amendment of the labour code

par Planet Labor - 01 Janvier 2008

On 1 April 2007, an amendment of the Hungarian Labour Code (Act No. XXII of 1992, LC) came into effect. The most important changes concern the co-determination rights of Hungarian works councils, the fundamental right of workers to regular rest periods, moreover the legislation facilitates the application of the principle of non-discrimination regarding agency work.

Changes in the co-determination rights of works councils. Hungary has a dual channel system of industrial relations where both works councils, as elected representatives of the employees, and trade unions can be organized at workplace level. Election of works councils is possible, if the employer has more than 50 employees or at each site (unit) of the employer fulfilling this requirement. Contrary to a former Supreme Court decision [EBH 2004/1148], according to the new rules the works council can exercise its codetermination right on the utilisation of welfare facilities and properties (such as workers hostel, crèche etc.) if it is included in a collective agreement. There aren’t any statutory de minimis requirements for the content of collective agreements in the LC. Therefore it may happen that the works council won’t have any influence on the decision of the employer.

Fundamental right of workers to regular rest periods. Following a decision of the Constitutional Court (Alkotmánybíróság, AB) in 2006 several important amendments were enacted which further clarify the duty of the employer to give reasons if it intends to transfer the paid annual leave of the workers to the next calendar year. According to the general rules the statutory minimum paid annual leave, twenty working days, must be granted to the worker within the current calendar year. Only one quarter of this was transferable to the next year, if the employer could show that it is in his ‘exceptionally important economic interest’. According to the AB this rule constituted an unconstitutional restriction of the fundamental right of workers to regular rest periods, because it is not justified by any other constitutional right, principle or objective. A necessary and proportionate restriction of this right must include considerations other than only the economic interest of the employer [74/2006 (XII. 15) ABH]. Firstly, the new legislation emphasizes that the transfer of annual leave based on economic reasons must be exceptional which means that the transfer can not be used as adapting the size of the workforce to the amount of work the employer has to carry out in the current year. Therefore it must be based on considerations other than the organization of work. It must be shown that the transfer is necessary because the granting of annual leave in the currant year would be harmful to the economic management of the employer. Alternatively, the transfer of annual leave can be considered necessary if a direct and pressing reason relating to the operation of the employer justifies it. Such reasons can for example consist of an accident, a natural disaster, or the prevention of a serious damage or danger to life, health and physical integrity.

Temporary work. The amendments aim to enforce the application of the principle of non-discrimination regarding agency work. In order to facilitate the identification of the comparator of the agency worker, the user undertaking is required to provide data on the wages of its own employees carrying out work of equal value. Similarly, the contract of employment will be established with the user undertaking for an indefinite duration, if its duration can not be identified because the agency failed to conclude a contract of employment with the employee. Moreover, the rules on fixed term contracts were not applicable to agency work. According to an opinion of the European Commission this was contrary to the Directive 1999/70/EC on fixed term work, which does not allow difference of treatment between permanent and atypical employment. Following the amendments the renewal of fixed term contract of employment established for agency work between the same parties is only possible if the employer can show that it has legitimate interest to do so.

e-europnews, October 10, 2007, n° 070834 - www.eeuropnews.com

haut de page

A propos de cet article

Auteur(s) : Planet Labor

Mots clés : e-europnews, planet labor, Hungary, labour law, labour code, reform