We continue our series of newsletters on the new LabourCode by describing the most important changesregarding working hours.

CHANGES REGARDING WORKING TIME

The new Labour Code sets out a model that is more inline with current lifestyle and economic circumstances,from the perspective of working time. A clear goal ofthis change is to place emphasis on economic andbusiness aspects, as well as to ensure future planning andto encourage more flexible management of workinghours.

It is perhaps here most apparent that the new LabourCode has a more transparent structure, as compared withthe existing Labour Code. This may ease its applicationin practice.

Flexible working time management

The application of working time cycles is the best way tosecure flexible working time management. The termremains capped at four months, except in special cases.As a new element, the new Labour Code sets forth ruleson account settlement in case of the termination ofemployment before the expiry of the working time cycle.

Moreover, in addition to working time cycles, the newLabour Code introduces the possibility of a longeraccount settlement period, which – in contrast to theworking time cycles – is purely a provision for workingtime arrangements. On the basis of this regulation, theemployer will be entitled to require the employee to workhis/her weekly hours over a longer period. It will be amatter of practice as to whether this new rule on workingtime arrangements will actually be implemented and usedwidely.

The obligation of prior notice of working timearrangements remains unaffected (for a seven-day period,at least seven days' notice), but the new Labour Codeallows the employer, in its sole discretion, to alter the pre-set working time arrangement, at least four daysbeforehand, in case of unexpected circumstances. Suchcase of alteration of working time arrangements does notmean a request for overtime, as work is still carried outduring normal working hours.

Working on Sundays and public holidays

The new Labour Code offers a wider range of reasons forcarrying out work on Sundays and public holidays.Pursuant to the shift in lifestyle and economic conditions,the number of cases in which work may be carried outduring normal working hours on public holidays willchange. The number of very limited exceptions allowed

NEW LABOUR LEGISLATION INHUNGARY FROM 1 JULY 2012

Part III: Working hours

www.dlapiper.com

Horváth & Partners Law Firm in cooperation with DLA Piper UK LLP is part of DLA Piper, a global law firm, operating through various separate and distinct legal entities. A list of

offices and regulatory information can be found at www.dlapiper.com.

Copyright ©2012 DLA Piper. All rights reserved. | FEB02 | LDSDP: UKG\12605446

under the strict provisions of the existing legislationincreases. Within the framework of this new model, forexample, services provided abroad will always establishsufficient and satisfactory reasons for work to be carriedout on public holidays, as the limitation that servicesshall be provided through information technology andinformatics devices is removed from the Act. (Thismeans that, in future, not only will help desk- and callcentre-like service providers be entitled to provideservices on Hungarian public holidays, but all companieswith an international clientele providing cross-borderservices will be similarly entitled).

The new Labour Code contains similar provisionsconcerning working on Sundays during normal workinghours, meaning that the number of cases thereof increasesas well.

Overtime

In this respect it should be emphasised that in the newLabour Code the provision allowing the employer torequest overtime only in particularly reasonable cases hasbeen removed.

The cap on such overtime increases from the current200 hours to 250 hours per annum, which may beextended to 300 hours by provision of a collectiveagreement.

Annual holiday

The new provisions regarding annual holiday are alsosignificant and progressive.

The new Labour Code lifts the contradiction between theobligation to give annual holiday during calendar yearand the special rules concerning the probationary period:pursuant to the new provision, in case of employmentstarted after 1 October, annual holiday shall be givenuntil 31 March of the next calendar year.

It also increases flexibility and softens the previous rigidregulation in that, in future, the parties may agree to carryover one-third of their annual holiday to the next year.However, it should be emphasised that the agreement of

the parties is of essence; the employer shall not beentitled to decide on this matter in its sole discretion.

The modifications relating to other regulatory areas willbe set out in the following issues of our DLA PiperNewsletter.

CONTACT

Helga Fehér

Partner

T +36 1 510 1100

helga.feher@dlapiper.com