A new decree entered into force on 9 April 2024 on the ban of employment of guest workers in the public sector in Hungary.
The following entities may not establish an employment relationship with a guest worker to work on the basis of a work permit, a residence permit for employment purposes or a residence permit for guest workers issued to carry out an investment project in Hungary:
- a budgetary organisation under the direction or supervision of the Government,
- a budgetary organisation under the direction, control or maintenance of another budgetary organisation and forming part of the central sub-system of public finances,
- a company in which the Hungarian State has direct or indirect majority ownership, and it is owned by a budgetary body, or by an economic corporation owned by a budgetary organisation, or by a subsidiary of an economic corporation belonging to the latter category.
However, the new regulation makes one exception: the person designated by the Government may grant an exemption from the prohibition in respect of a company for compelling reasons, on the initiative of the competent Minister.
The new decree will not affect the employment relationships established before the date of the entry into force of the new decree. In other words, guest workers currently working in the public sector, in state-owned companies, will be able to keep their jobs.
By Eszter Ila-Horvath, Attorney at Law, KCG Partners Law Firm
