Member Article

On the 10^thof April, 2020, the Government of Hungary as part of its long-awaited Economic Protection Action Plan (the “Plan”) introduced by Government Decree 104/2020 the possibility for employers to introduce a 24-month working time frame.

According to Government Decree 104/2020, during the state of emergency the Labor Code shall apply with the exception that the employer may order a working time frame for a maximum of twenty-four months. The regulation also overrides the provisions of collective agreements. The employer may extend to 24 months the working time frame imposed before the entry into force of the Decree. Employment according to the extended working time frame shall not be affected by the end of the state of emergency.

With certain exceptions, Section 99 of the Labor Code (daily minimum, daily and weekly maximum working hours) and Sections 104-106 (length of rest periods and number of rest days) cannot be deviated from, but this - especially in the case of unequally scheduled working time - gives employers a lot of leeway over a 24-month period.

The 24-month working time frame that companies can now unilaterally introduce is therefore a significant relief for large companies that are now stopping or restraining their activities and still need to pay a basic wage for workers. If the 24-month working time frame is introduced, the employer will have the opportunity to require employees to work the lost hours later without having to pay them overtime.

SUMMARY OF GOVERNMENTAL R+D EMPLOYEE SUBSIDY IN CONNECTION WITH COVID-19 IN HUNGARY

On the 10^thof April, 2020, the Government of Hungary as part of its long-awaited Economic Protection Action Plan (the “Plan”) introduced a subsidy scheme for the employment of research and development (R+D) employees byGovernment Decree 103/2020.

Employers can receive a government subsidy after researcher-developers (engineers, researchers, IT specialists) for a maximum of 3 months, which can be applied for from April 15 until one month after the end of the state of emergency. The subsidy covers all non-state-budgetary employers where research and development is carried out.

The employee must qualify as a researcher-developer as per the Act LXXVI. of 2014 on Innovation: a natural person who is engaged in the creation or development of new knowledge, intellectual property, a product, service, procedure, method or system or who is engaged in the management of the implementation of projects aimed at it.

The subsidy is for a period of three months and its amount may not exceed HUF 318,920 per month per person, ie a total of HUF 956,760 per person. Below the HUF 670,000 gross salary, the subsidy decreases proportionally. The amount thus awarded is paid to the employer, who must guarantee in return for the aid that the company will maintain its headcount level and that the employee will remain employed for at least 3 additional months for a salary/wage not lower than on the day the state of emergency was declared (March 11, 2020).

To understand if your business is eligible, the amount and duration of subsidy your employees are entitled to and other conditions, our Employment Law team is at your disposal.