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Amendments to the Labor Code – Is There More to Come?

Amendments to the Labor Code – Is There More to Come?

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Amendments to the Hungarian Labor Code entered into force in June 2016. The amendments were approved as part of the Act on the State Budget 2017 and are rather technical, mostly involving provisions that ensure compliance with recently amended European legislation. In this article, we briefly summarize the most important amendments to the Labor Code.

Protection From Dismissal

The Hungarian Parliament recently supplemented the rules protecting employees from unfair dismissal. The former labor code, in force until 2012, provided unconditional protection against the termination of employment of pregnant employees and those undergoing fertility treatment. The current labor code also includes this rule but stipulates that employees may only enjoy this protection if they had informed their employer about their pregnancy or fertility treatment before the dismissal was communicated to them.

The Office of the Commissioner for Fundamental Rights (OCFR) initiated a constitutional review of this provision before the Hungarian Constitutional Court shortly after the new labor code came into force. The Constitutional Court examined the question, agreed (partially) with the OCFR, and abolished the requirement to inform the employer of the said circumstances “before dismissal”. The current amendment supplements the partly abolished provision and affords the employer the opportunity to revise its decision if the employee informs the employer after the communication of the dismissal that she in fact enjoys protection. In such case the employer may withdraw its notice within 15 days of receiving the notice of the protection.

Provisions on Resting Time

The rules governing daily rest periods – Section 104 of the Hungarian Labor Code requires that a period of at least 11 hours must be provided for an employee between working days – were also modified. The most important reason for the amendment was that the European Court of Justice (ECJ) confirmed in one of its decisions (Syndicate Solidaires Isere case (C-428/09)) that the health, safety, and personal security of employees can only be ensured if their right to sufficient rest time is respected. This implies that no activity which may disturb the employee is allowed during the rest period. Furthermore, the rest period must immediately follow the working period.

Following the principles of the ECJ’s interpretation, the respective Hungarian provision was amended so that if an employee receives fewer than 11 hours of daily rest between two shifts, the next two daily rest periods must total at least 22 hours.

According to a secondary rule, if the rest period falls in the beginning of the summer period, a minimum of 10 hours must be provided, and in the case of divided, continuous, or multiple shift employment or seasonal work, the minimum rest period is 7 hours.

These new provisions will enter into force on January 1, 2017. This means that any working-time cycle, reference period, or pre-defined working time that is organized before then may “break” into the new year without change.

Provisions Related to Executives

The range of strict provisions governing executives’ employment will be widened.

Currently the Labor Code represents a rather flexible approach in relation to executive employees, in that it allows the parties to contract away from the legal rules on a wide range of topics. The Labor Code contains only a few provisions from which an employment contract may not deviate (e.g., an executive employee may not fall under the personal scope of a collective agreement).

According to the new provisions already in force, the labor contract of an executive employee may not deviate from the provisions of the Labor Code in respect of (i) the rules providing statutory exemption from work during fertility treatments, obligatory medical examinations, and maternity leaves; (ii) the rules governing the protection from dismissal in cases of pregnancy, maternity leave, and fertility treatment; (iii) the special working time rules of endangered employees.

The reason behind these amendments is that the related EU Regulation (2010/18/EU) on parental leave has changed, which has to be harmonized with domestic rules.

Ease of Sunday Working Ban

The earlier provision prohibiting Sunday work for employees working in on-call duty positions (e.g., facility management, security staff, etc.), if they were scheduled to work on the preceding Saturday, was abolished as of June 18, 2016. This provision was abolished as it was found to be impractical.

Summary

The Hungarian Parliament tried to keep the integrity of the Labor Code while amending it where necessary due to EU law obligations. The current modest amendments came by surprise, as a more significant amendment proposal had been prepared and published by the Government last autumn. That proposal was not approved, but it may be introduced to the Parliament again in the near future.

By Kinga Hetenyi, Managing Partner, and Daniel Gera, Attorney at Law, Schoenherr Hetenyi Attorneys at Law

This Article was originally published in Issue 3.4 of the CEE Legal Matters Magazine. If you would like to receive a hard copy of the magazine, you can subscribe here.

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