Guide to employing in Hungary

Get Started
Capital City
Population Size
9,772,756 (2020)
Language Spoken
Hungary panorama


Hiring employees in a foreign country can be a challenging and resource-intensive task. XPANDIUM is an expert provider of Employer of Record (EOR) services in Hungary. We offer an EOR solution as a cost-effective and compliant way to handle all aspects of onboarding, payroll management/administration, tax payments and benefits without you having to establish a legal entity in Hungary.

When you choose to partner with XPANDIUM as your employer of record in Hungary, our own local EOR entity assumes all the responsibilities of an employer. We assist you in navigating the applicable employment regulations of the specified country while you focus on unlocking your business’s full potential.


Salary Calculator

Net Wage
Gross Pay
Net wage
Gross pay
Total gross cost

XPANDIUM - Hire your employees in Hungary

The Hungarian labour market operates under the labour code, which ensures fair and transparent labour practices and protects the rights of both employers and employees.

This labour code specifies rules and procedures that companies must comply with when hiring employees in Hungary and includes regulations regarding working hours, paid time off, illness termination and maternity benefits. 

Ensuring labour practices are correctly implemented requires a thorough understanding of the labour code, and implementing it correctly can be a time-intensive task. Non-compliance with the labour code can be costly and lead to fines and sanctions for the offending company. XPANDIUM understands the importance of these regulations and will work diligently to prevent any potential pitfalls, allowing your business to flourish in Hungary's dynamic market.

When you hire workers in Hungary using an EOR service, it’s important to note that Hungarian EOR service providers are strictly regulated and legally required to have a valid agency licence.

XPANDIUM can assist your company in navigating the intricacies of the labour market when you hire employees in Hungary. With our extensive knowledge of the Hungarian labour code, we offer you seamless guidance and support, ensuring proper labour practices are always maintained.

When you partner with XPANDIUM, we will ensure your company complies and stays current with any Hungarian labour code changes.

Germany panorama

The following information is a basic guideline for employment in Hungary with a salary calculator that can easily help you to understand the approximate costs.

Employment Contract

Employment contracts may be fixed term or for indefinite duration.Fixed-term contracts are allowed for up to a maximum 5-year period (including breaks) if they are for temporary, seasonal work or EOR scheme.

Probation period

Probationary period is 3 months from the date of commencement of the employment relationship. In the event of a shorter period being agreed on, the parties cannot extend the probationary period.

Working hours

Full time employment means 40 hours per working week in Hungary. Less hours will automatically mean part-time work.

Employees can work no more than 250 hours in overtime (OT) per year and other special conditions apply for other extraordinary working hours and corresponding payments. Employment agreements must stipulate the agreed working hours per week for the employee.

Flexible work schedule

Employees telecommuting i.e. working remotely in “home-office” may work flexible hours, however special labor law conditions apply for both a flexible telecommuting or uneven time-framed working schedule scheme.

Minimum wage

From 1 Feb 2021 the minimum gross wage is HUF 167,400 per month for a 40-hours a week, full-time contract.

In the case of jobs requiring a high secondary education / qualification, the minimum guaranteed wage is HUF 219,000 per month for a full-time contract.

13th month salary

In Hungary, the 13th month salary is not mandatory, however if it is offered then all employees must receive it on the equal rights specified in the Labor Law.

Benefit package

In Hungary, there are no obligatory fringe benefits that an Employer must offer however a voluntary plan can be set up which is referred to as a Cafeteria system (see more details in the Benefits section).

Payroll Cycle

Monthly salaries must be paid within 10 calendar days following the relevant month and after payroll is closed for all employees.

Health insurance in Hungary

Hungary provides full medical coverage to all residents, with payroll contributions as one source of funding. The government pays contributions for certain groups such as the unemployed and pensioners.


Public Holidays




New Years Day

January 1

National Day

March 15

Memorial Day of the 1848 Revolution

Good Friday

April 2

Friday before Easter Sunday

Easter Monday

April 4

Varies yearly

Labor Day / May Day

May 1

Anniversary of the accession to the EU

Pentecost Sunday

May 21

Saint Stephen’s Day

August 20

Republic Day

October 23

All Saints Day

November 01

Bridge Day

December 11

Working day instead of Dec 24

Holy Evening

December 24

Christmas Day

December 25

Second Day of Christmas

December 26


Popular Benefits in Hungary

When you decide to partner with XPANDIUM’s payroll services in Hungary, we can help you create specialised benefit packages to attract top candidates in the Hungarian market.

This means XPANDIUM will help your company design and establish customised plans to compensate employees beyond regular salaries. These voluntary, non-salary benefits may include:

home icon

Szèchenyi card / Accommodation support

coffee icon

Szèchenyi card / Catering-meal support

pool iocn

Szèchenyi card / Leisure time service support

money icon

Voluntary pension fund contribution

card icon

 Èdenred Gift Silver/Gold/Platinum Card contribution

train icon

Commuting allowance (special terms may apply)

Supplementary medical insurance  icon

Supplementary medical insurance (private or dental/vision)

Benefit planning process includes

XPANDIUM understands the importance of offering attractive benefits to attract top-tier candidates when your company hires employees in Hungary. We can assist your company in designing and implementing unique benefit programmes for single or group employees. This process will include:

  • Helping you determine the annual benefit amount you want to offer employees – this amount can be divided into 12 instalments and integrated into the regular payroll.
  • Determining which benefit items to offer employees and designing unique benefits packages.
  •  Internal policies should be created to outline the benefits plan, formally communicated to relevant employees and integrated with the monthly payroll.
  • Ensuring employees have accurately completed benefit statements – specifying preferred benefits and respective amounts. These statements must be completed, signed and provided to the Hungarian Employer of Record for processing.

Types of Leaves in Hungary

Paid leave

Employees are entitled to be paid annual leave based on the time spent at the contract. The days increases based on the age of the employee, the number of children in the family or other special health conditions.

Statutory paid leave is 20 days per year and increases with +1 day in every 3 years until the employee’s age reaches 45 when a max +10 days vacation applies.

Extra vacation days are applicable to both parents based on the number of children:
For 1 child: + 2 days
For 2 children: + 4 days
For 3 children or more: + 7 days

Sick leave

An employee is entitled to 15 sick-leave days yearly while enrolled in the national social security system. During this 15 days of period employees must receive max. 70% of their base gross salary which is paid by the Employer.

After 15 days, the amount paid varies from 50% – 70% depending on employment social security coverage the employee has had 760 days backwards.

The sick leave allowance gets paid one third by the employer and the remaining amount is paid by the state. Sick leave is required to be proved by a medical certificate issued by a local certified doctor (GP). Such a certificate is to be provided to the local payroll immediately in every 8 days. Sick leave is maximized in one year if such leave occurs during termination period.

Pregnancy and maternity leave

Expecting women have 24 weeks maternity leave, but are allowed to take up to three years off and receive maternity benefits. The maternity leave have to start 4 weeks prior to the scheduled delivery date unless the employee would like to work up to the delivery day on her own risk.

After delivery and for the first 6 months, a woman receives 70 % of her base salary paid by the State; this support is called Pregnancy and Confinement Benefit. For the next 18 months, until the child’s 2nd birthday, a Child Care Fee is available, however the employee is entitled to work part-time and still receiving this benefit by the State.

Paternal leave

The father is entitled to 5 (five) days off for paternity leave which the employer must allocate within two months following the date of birth upon the father’s request. As a paternity leave, the father can take a leave instead of the mother until the child reaches 2 years of age.

Short-term child care leave

Employees are entitled to short-term and paid child care leave. This type of special leave is certified by the employee’s GP.

Other leave

Unpaid leave: Unpaid leave can only be defined as quasi extraordinary vacation without pay, which is an opportunity, but also there are compulsory cases according to the Hungarian Labour Law for reasons.

Employees shall convey the request for leave of absence without pay in writing, at least fifteen days in advance, for example for Long-term child care leave

Compassionate leave: when a close family member (i.e spouse or grandparents) of the employee is seriously or life-threateningly ill or be in such and requires care.

Emergency and short absence leave

Military service


Employment termination in Hungary

In Hungary employers have the below options to terminate an employment contract:

Termination by mutual consent

The termination by mutual consent is not regulated by expressed Hungarian Labour Law provisions, because termination by mutual consent allows the employer and employee to agree freely but in written agreement with each other on the conditions of termination.

However terminating employment this way is a very common and highly supported practice due to parties waiving all further claims, subject to individual severance payment and notice period.

Termination by notice

An employment relationship may be terminated by the employee or the employer by notice. If so, agreed by the parties, the employment relationship may not be terminated by notice for a period of up to one year from the date of commencement of the employment relationship.

Employers must justify their dismissals in writing. The reasons must be clearly specified, authentic and substantial. Reasons for termination by notice may be in connection with the employer’s behaviour in relation to the employment relationship, with the employee’s ability or in connection with the employer’s operations.

The employer shall be permitted to terminate a fixed-term employment relationship by notice:

  • if undergoing liquidation or bankruptcy proceedings; or
  • for reasons related to the employee’s ability; or
  • if maintaining the employment relationship is no longer possible due to unavoidable external reasons.

Statutory notice period is 30 days but where employment terminated by Employer the thirty-day notice period shall be extended depending on the duration of the employment.

Dismissal without notice

Employer or Employee may terminate an employment relationship without notice if the other party:

  • wilfully or by gross negligence commits a grave violation of any substantive obligations arising from the employment relationship; or
  • otherwise engages in conduct that would render the employment relationship impossible.

The right of termination without notice may be exercised within a period of fifteen days of gaining knowledge of the grounds. Therefore, in any case within not more than one year of the occurrence of such grounds, or in the event of a criminal offense up to the statute of limitation.

In case of termination without notice, the justification is obligatory for the employer or the employee as well.

Severance pay

The employee is entitled to severance pay if the employer terminates the employment relationship by ordinary termination with notice; the employees are entitled to receive varying amounts of severance pay depending on the length of employment with the employer.


How EOR works in Hungary

XPANDIUM offers specialised EOR services in Hungary as a strategic solution for companies hiring employees across borders. By opting for XPANDIUM’s EOR solution, you delegate the responsibility of employing talent to our local business entity. XPANDIUM will seamlessly handle all aspects of labour regulations, payroll administration, distributing salaries and filing employee-related taxes and returns.

As your employee’s EOR in Hungary, XPANDIUM will help you to navigate all employment processes from start to finish and assist you in enhancing your workforce management.

Take the complexity out of hiring employees in Hungary, and contact XPANDIUM for a tailored employer-of-record solution.


Payment in Hungary

Thanks to its IT advancements and pool of highly skilled professionals, Hungary has become an excellent choice for global expansion. However, managing employee payroll in Hungary can pose a significant challenge amidst this landscape.

At XPANDIUM, we offer local expertise to ensure your company complies with local Hungarian payroll regulations.  Our dynamic team effortlessly handles the intricacies associated with payroll services in Hungary, such as wage calculations, taxation complexities, deductions and benefits administration.

By partnering with XPANDIUM as your payroll provider in Hungary, we will guide the way forward to a strategic approach towards payroll management. Here is what is included in XPANDIUM’s payroll services in Hungary:

  • Pre-Payroll Processes – XPANDIUM will collect and verify all your employee’s data and develop the proper procedures to ensure future payroll success.
  • Payroll Calculation – The data collected during the pre-payroll phase will be seamlessly integrated with your payroll system to ensure precise salary calculations.
  • Post-Payroll – XPANDIUM will facilitate salary payments, payroll accounting, and payroll reporting and ensure compliance with local payroll regulations

Experience a seamless payroll journey in Hungary with the expertise of XPANDIUM. Our specialised payroll services enhance your experience by ensuring compliance, efficiency and operational excellence. Discover the benefits of payroll management with XPANDIUM as your partner in Hungary.