Hire employees and contractors in Hungary

Remote’s guide to employing in Hungary.

  • Capital city

    Budapest

  • Currency

    Hungarian forint
    (Ft, HUF)

  • Population size

    9,772,756

  • Languages spoken

    Hungarian

  • Availability

    Remote-Owned Local Entity

    We own our own entity in the countries where we operate to shield your company from risk and provide you and your employees with the signature Remote experience.

Facts & Stats

Hungary, a landlocked nation in Central Europe, is one of the oldest countries on the continent. With a literacy rate over 99% and a robust educational system, Hungary is one of the most educated countries in the world. A country filled with delicious food and more thermal springs than any other country, Hungary is a top destination for global travelers.

  • Capital city

    Budapest

  • Currency

    Hungarian forint
    (Ft, HUF)

  • Languages spoken

    Hungarian

  • Population size

    9,772,756

  • Ease of doing business

    Very easy

  • Cost of living index

    $$ (79 of 139 nations)

  • Payroll frequency

    Monthly

  • VAT - standard rate

    27%

  • GDP - real growth rate

    4.6%

Grow your team in Hungary with Remote

Looking to employ workers in Hungary? Companies hiring in Hungary must either own a legal entity in the country or work with a global employment solutions provider, usually one that provides employer of record services. Remote can employ your team in Hungary on your behalf through our local legal entity in the country and handle payroll, benefits, taxes, and compliance for your Hungarian team.

Risks
of misclassification

Hungary, like many other countries, treats self-employed contractors and full-time employees differently. Misclassification of contractors in Hungary may lead to fines and penalties for the offending company.

Employing in Hungary

Hungarian employment is legislated by a combination of national and international laws, matching its fellow European countries in most respects. Employers and employees in Hungary must use written employment agreements to commence employment relationships. These contracts must include several details, including the title of the position, the salary to be paid, and the location where the work will be performed. With remote work on the rise, employers must be vigilant to ensure their employment contracts in Hungary will hold up to scrutiny.

Public holidays

Date
Holiday Name
Saturday, January 1, 2022New Year's Day
Tuesday, March 15, 2022Revolution Day
Friday, April 15, 2022Good Friday
Sunday, April 17, 2022Easter Sunday
Monday, April 18, 2022Easter Monday
Sunday, May 1, 2022Labour Day
Sunday, June 5, 2022Whit Sunday
Monday, June 6, 2022Whit Monday
Saturday, August 20, 2022Saint Stephen's Day
Sunday, October 23, 2022Republic Day
Tuesday, November 1, 2022All Saints Day
Sunday, December 25, 2022Christmas Day
Monday, December 26, 20222nd Day of Christmas

Minimum Wage

Hungary differentiates between the minimum wage and the guaranteed minimum wage. The guaranteed minimum wage only applies to full-time employees hired for jobs that require at least a secondary school qualification or secondary vocational qualification. The minimum wage applies to everyone regardless of qualifications.

Hungary's minimum wage is 200,000 HUF gross per month, applicable to non-taxable expenses (max. 10% of min. wage). This means that 20,000 HUF per month can be given to the employee tax free until the end of emergency pandemic laws.

The guaranteed minimum wage is 260,000 HUF gross/month.

The minimum wage is known locally as "minimálbér." The guaranteed minimum wage is "bérminimum."

Payroll Cycle

Salaries must be paid on a monthly basis.

Onboarding Time

We can help you get a new employee started in Hungary fast. The minimum onboarding time we need is only 9 working days.

Our team ensures your employees are onboarded and paid as quickly as possible while keeping your business compliant with all local employment legislation. The minimum onboarding time begins after the employee submits all required information onto the Remote platform. The onboarding timeline is also dependent upon registration with local authorities.

For all non-nationals of the country of employment, the Right to Work assessment (if applicable) will add three extra days to the total time to onboard. There may be extra time required if we need to follow-up on the right to work assessment.

Please note, payroll cut-off dates can impact the actual first day of employment. Remote has a payroll cut-off date of the 10th of the month unless otherwise specified.

Competitive benefits package in Hungary

At Remote, we’re obsessed with helping you craft the best possible employee experience for your team. We are leading the way in practicing “fair equity,” which means making sure employees everywhere have access to both the required and supplemental benefits they need to thrive (and that will allow you to attract the best local talent).

Our benefits packages in Hungary are tailored to fulfill the local needs of your employees. Typically, our packages contain some or all of the following benefits:

  • Health Insurance
  • Dental Insurance
  • Vision Insurance
  • Mental Health Support
  • Pension or 401(K)
  • Life and Disability Insurance

Taxes in Hungary

Learn how employment taxes and statutory fees affect your payroll and your employees’ paychecks in Hungary.

  • Employer

    • 13% - Social Tax (Social Security)

    • 13% - Total Cost of Employment

  • Employee payroll taxes

    • 10% - Pension Contribution

    • 7% - Health Insurance

    • 1.5% - Unemployment Contribution

  • Employee income tax

    • 15% (Flat rate for all employment income)

Types of leave

Statutory leave

Employees in Hungary are entitled to between 20-30 days of paid leave per year, depending on the age of the employee.

  • Employees below age 25 receive 20 days of PTO.
  • Employees between the ages of 25-31 receive 21 days of PTO.
  • Employees between the ages of 31-45 receive 21 days of PTO plus three additional days every three years.
  • Employees above age 45 receive 30 days of PTO.

Employees in Hungary receive additional paid leave if they have children.

  • Employees with one child receive two extra PTO days.
  • Employees with two children receive four extra PTO days.
  • Employees with more than two children receive seven extra PTO days.

Pregnancy and maternity leave

Mothers in Hungary receive 24 weeks of paid maternity leave paid at 70% of their average wages, beginning four weeks before the due date. New mothers in Hungary also receive special benefits from the National Health Insurance Fund, including a child care allowance.

Partner/Paternity leave

In Hungary, fathers are entitled to five days of paid paternity leave within two months of birth.

Hungary also offers parental leave, which either parent can take before the child’s second birthday. Parental leave is paid at the same rate as maternity leave (70% of average wages) but is capped at twice the minimum wage. Hungarian laws do not recognize LBGTQ+ relationships and do not extend parental leave to those partners.

Sick leave

Employees in Hungary are entitled to 15 days of sick leave per calendar year.

Additional leave

Employees may take unpaid leave for a variety of reasons, including childcare beyond that covered by maternity, paternity, or parental leave. Unpaid leave requests must be made in advance in writing.

Employment termination

Termination process

Employers in Hungary are usually required to provide a reason (in writing) to every employee being terminated. The reason must be clearly stated and factual.

Employers cannot terminate employment when an employee is on maternity leave, parental leave, leave for voluntary reserve military service, or in other cases protected by Hungarian law.

Notice period

To terminate an employee in Hungary, the employer must provide advance notice of between 30-90 days. This period does not apply to employees on fixed-term contracts whose engagements end on the scheduled date specified in the agreement.

The base 30-day notice period for termination is extended based on the amount of time the employee has worked for the company:

  • 5 additional days after three years of service
  • 15 additional days after five years of service
  • 20 additional days after eight years of service
  • 25 additional days after 10 years of service
  • 30 additional days after 15 years of service
  • 40 additional days after 18 years of service
  • 60 additional days after 20 years of service

Severance pay

Severance pay in Hungary ranges from one month’s salary to nine months’ salary depending on the tenure and age of the employee in question. Employment contracts should clarify expectations and procedures for severance pay to avoid misunderstandings. Employees are entitled to severance pay when they are terminated unilaterally by their employer, when the employer shuts down, and in certain situations involving acquisitions.

Probation periods

In Hungary, the maximum probation period is three months. After the probationary period ends, the employee is considered a full employee and entitled to all the protections of Hungarian labor law, even if no probationary period was specified in the employment contract.

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