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.
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.
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.
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In Hungary, the minimum wage is 161,000 HUF per month for unskilled labor and 210,600 HUF per month for skilled labor.
Salaries must be paid on a monthly basis.
We can help you get a new employee started in Hungary fast. The minimum onboarding time we need is only 72 hours.
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
Beyond providing your employees with all statutory benefits in Hungary, Remote can help you create a custom benefits package for your Hungarian team. A competitive benefits package may include perks such as:
Taxes in Hungary
Learn how employment taxes and statutory fees affect your payroll and your employees’ paychecks in Hungary.
- 15.5% - Social Tax (Social Security)
- 1.5% - Unemployment Contribution
- 17% - 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
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
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.
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.
Employees in Hungary are entitled to 15 days of sick leave per calendar year.
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.
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.
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 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.
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.