Employer of record in Hungary: costs, rules and how to hire

Three of these change the legal position rather than the budget: the agency structure, the fifteen-day agency notice rule and the permit route. The rest are places where a Hungarian number means something narrower than it looks.

Seven checks before accepting a quote

Ask the provider to answer each of these against this role and this person.

• Employment structure: determine whether temporary agency rules apply and verify the lender's registration.
• Qualified jobs: the 2026 guaranteed minimum is HUF 373,200 monthly where the job requires the relevant qualification.
• Net salary: ordinary deductions are 18.5% social security and 15% PIT, with personal allowances affecting the outcome.
• Leave: age and children can increase annual entitlement; sickness and family benefits have separate pay and eligibility rules.
• Work calendar: the 2026 bridge days are exchanged for working Saturdays.
• Termination: agency employment has a fifteen-day notice rule; ordinary employment has a different schedule.
• Immigration: nationality, qualifications and the exact permit route matter. An EOR agreement does not guarantee permission.

Then request an example payslip, a responsibility schedule and a complete annual cost estimate, and agree who receives government notices, checks source changes and explains any contract or payroll adjustment to the employee.

A Hungarian employment contract has to be written and needs to agree the job and the base wage. Without contrary agreement, employment is indefinite and full-time, with the usual work location and the statutory default start date. Missing writing can be challenged by the employee within thirty days of starting, which is a remedy rather than permission to skip the contract.

What belongs in the employment agreement?

Give employees terms they understand and arrange an appropriate Hungarian version or translation for local use.

Beyond the contract itself, provide the required written employment information within seven days of commencement, covering employer authority, duties, work location, hours and scheduling, pay dates, leave, exit rules, training and the applicable collective agreement. Items already stated in the contract need not be repeated. Notify relevant changes by their effective date, and note that extended work abroad carries additional advance-information requirements.

Record the role and duties, work location, hours, gross base wage, payment dates, benefits, leave, probation and termination arrangements. For agency employment the contract must explicitly state its lending purpose and the work and pay terms, and the worker also needs the lender's registration number and the assignment information before the assignment starts.

Divide the EOR and client responsibilities

The lender and the client must agree their duties in writing, and only the lender can terminate the employment. During an assignment the client carries specified workplace-safety, working-time, rest and record-keeping duties. Onward lending is prohibited, workers cannot be charged placement fees, and a restriction preventing employment with the client after the agency employment ends is void.

An assigned worker must receive the applicable basic employment conditions provided to comparable client employees, including protection, working time and pay. Certain statutory categories defer the pay-and-benefit equality requirement until the 184th day, which is a narrow rule rather than a general exemption for all agency workers, so check the actual contract and category.

Specify how the client sends approved hours, leave, overtime and variable pay to the employer, because the default deadlines are tight. Under the ordinary agency default, payroll data reaches the lender by the fifth of the following month, and an exit during the month needs the data within three working days of the last worked day. A dispute between client and provider should never leave the employee without a clear pay contact.

Probation and fixed terms

Probation must be agreed and ordinarily cannot exceed three months, though a collective agreement can permit up to six. A shorter agreed period can be extended once within the ordinary maximum. Fixed-term employment of twelve months or less requires proportionate probation, and qualifying renewals or repeat contracts within six months for the same or similar role cannot restart probation.

A fixed term is ordinarily limited to five years, including extensions and repeat employment within six months, and renewals need a legitimate employer interest without harming the employee's legitimate interests. Employer termination by notice has restricted grounds, and immediate employer termination without a reason carries twelve months of absence pay, or the remaining term if shorter, which is a separate liability from statutory severance.

When a contractor agreement fits

Assess the actual arrangement rather than the paperwork. The Labour Code employment model has the employee working under employer direction in return for pay, and a contract that disguises another arrangement is judged according to the arrangement it disguises. An ongoing managed team role should be assessed for employment, because a contractor invoice removes neither employee rights nor payroll obligations.

Document an independent contractor's service scope, control over delivery, resources and commercial responsibilities, and if the proposed arrangement is actually managed employment, resolve the classification before work starts rather than after an inspection.

Confidentiality and ownership of work

For work created as an employment duty, copyright economic rights normally pass to the employer on delivery unless agreed otherwise, with author remuneration and software-specific rules needing separate attention. A service invention created as an employment duty belongs to the employer under the patent rules, whereas an employee invention outside that duty can belong to the inventor with limited employer use rights. Document the chain of rights from employee to EOR to client, along with any compensation.

A non-compete agreement must be written, protect a legitimate employer interest and last no more than two years, with compensation appropriate to the restriction and at least one-third of the base wage for the restricted period. That is one-third of the base wage, not of an arbitrary average salary. The agency rule voiding restrictions on later employment with the client also has to be respected.

Identify pre-existing materials, inventions, permitted use, confidentiality, return of equipment and the deletion or transfer of work data. A provider's invoice is not an assignment of IP rights to the client.

Misclassification risk, and the direction test in the Labour Code

Hungary puts the operative word in the definition of the employment contract itself, and the word is direction. The employment relationship is created by an employment contract, and on the basis of that contract the employee is obliged to perform work according to the employer's direction while the employer is obliged to employ the person and to pay wages. Source: Labour Code, Act I of 2012, section 42 (1) and (2), National Legislation Database, archived capture 14 September 2026.

So the question to ask about any Hungarian contractor arrangement is whether the person will work according to your direction. If they will, the arrangement has the defining feature of employment, and a service contract describing independence the work does not have is the document that loses the argument. Hungarian practice applies a fuller set of primary and secondary criteria on top of that, and I have not read those from a government source in this pass, so I am describing the statutory core rather than the whole test.

What a hirer does about it: decide the status on the direction you will actually exercise, keep the day-to-day instruction of the work with whoever the contract says employs the person, and where you need someone working to your direction, employ them. I am not quoting a penalty figure because I have not verified one, and the contribution liability that follows a reclassification is reason enough on its own.

Payroll and bonuses

Ordinary wages are accounted for at least monthly and paid by the tenth day of the following month, with a written calculation provided by that date so the employee can check earnings and deductions. Pay in forints unless a statutory or foreign-work exception applies, normally to the employee's nominated account, with cash requiring a written agreement.

The Labour Code imposes no universal thirteenth or fourteenth-month pay for ordinary private employment. Pay any bonus or benefit that the contract, the applicable collective agreement or a binding employer commitment requires, and specify the performance conditions and timing. Private medical cover, meal or SZEP-card benefits and additional leave are package choices with their own tax treatment.

Three rates do most of the work in Hungarian payroll, and only the first of them is an employer cost. Keeping that straight is the difference between a budget that holds and one that overstates the employer's side by nearly a third.

Employer charges and employee deductions

The ordinary items sit as follows.

The employer social contribution tax, szocho, is 13% of its statutory tax base, and reliefs, exemptions and cross-border insurance rules can change the result. It is not the whole employment budget: leave, applicable sick-pay contributions, expense reimbursement, benefits, rehabilitation contribution and EOR fees all add to it.

An ordinarily insured employee pays an 18.5% social security contribution withheld from gross contribution income, and it is not an additional employer tax. Insured status, cross-border coverage, personal exemptions and eligible family contribution relief each need their own check.

The ordinary personal income tax rate is 15% on the taxable base, with employment salary forming part of consolidated income and eligible allowances applied in the statutory order. A historical OECD average effective income-tax percentage is not the payroll withholding rate for a new employee.

One floor is worth knowing for part-time work: ordinary employment contributions have a monthly floor of 30% of the statutory minimum wage, HUF 96,840 in 2026, subject to statutory exceptions and proportionate calculations, and the employer bears the employee contribution on the difference where the floor applies. There is no general salary cap stopping ordinary employee contributions at a fixed earnings ceiling.

Personal allowances can change net pay

Hungarian allowances are generous enough that two employees on identical gross pay can take home visibly different amounts, which is worth explaining to a hiring manager before it comes up.

Eligible mothers under thirty can deduct qualifying earned income without an amount cap from 2026, the two-child-mother allowance begins in 2026 for the cohort born in 1986 or later subject to the statutory family conditions, and separate allowances cover qualifying mothers of three or of four or more children. These are personal income-tax rules rather than an exemption from every payroll contribution.

For eligible young workers, the 2026 allowance covers qualifying income up to HUF 715,765 per eligible month, with the twenty-fifth birthday month included. The employer normally applies it automatically unless the employee asks to restrict it, and multiple income sources can require a restriction to prevent overclaiming. Foreign nationals face additional eligibility conditions.

The monthly tax-base allowance per qualifying child is HUF 133,340 with one dependent, HUF 266,660 with two and HUF 440,000 with three or more. At 15% the corresponding tax amounts are HUF 20,001, HUF 39,999 and HUF 66,000 per qualifying child, subject to eligibility, sharing and available tax or contribution liability, and eligible insured people can use 15% of unused family tax-base allowance against specified employee contributions.

Apply the employee's eligible declarations and supporting information in the statutory order, and keep the family tax-base deduction distinct from the tax saving it produces, because they are different amounts. Claim-sharing, several employers, foreign income and personal circumstances all change the calculation.

Registration, returns and cross-border work

Register the employer and the employee as required before work begins. Ordinary monthly payroll tax and contribution returns and payment are generally due by the twelfth of the following month. A foreign employer without a required Hungarian company registration can have direct NAV registration or representative obligations, so an entity is not universally required just to perform payroll duties, and the employee's ordinary annual income-tax filing and payment deadline is 20 May of the following year.

Hungarian tax residence, work location and any applicable treaty determine tax exposure, while social insurance needs its own assessment. Foreign individuals claiming Hungarian allowances face additional conditions, including the relevant 75% income test and no duplicate equivalent foreign benefit for the same period, and certain allowances restrict nationality or foreign-benefit eligibility. Do not promise the same net pay to every employee on the same gross salary.

Collect the correct tax identification and social insurance details and confirm which country's insurance rules apply before payroll. The employee should review the annual tax-return draft and add information it does not contain, because monthly withholding does not guarantee a complete annual return.

Rehabilitation contribution

An employer with an average statistical headcount above twenty-five must assess a contribution where qualifying disabled or reduced-capacity workers do not reach 5%. In 2026 the annual amount is HUF 2,905,200 multiplied by the shortfall, using the statutory headcount rules. Agency workers normally count at the client, or at the lender if it gives the required declaration, so agree that allocation before treating the EOR fee as the only additional cost.

Severance and the final payroll

Qualifying employer dismissal or specified employer cessation can create severance after three years: one month of absence pay, rising to two months at five years, three at ten, four at fifteen, five at twenty and six at twenty-five. Near-retirement additions and exclusions apply, pensioner status and certain conduct or non-health ability reasons can exclude entitlement, and agency employment calculates qualifying service using the last assignment under its special rule.

Immediate termination for a serious breach generally requires action within fifteen days of learning of the ground and within one year of its occurrence, with the criminal-offence exception, while probation and fixed-term employer termination follow separate rules. On ordinary notice termination, final wages and documents are due within five working days from the last worked day, and otherwise within five working days from termination, including unused annual leave and any notice or severance amounts.

For ordinary employment, the collective process generally applies over thirty days to at least ten dismissals in a workforce above twenty and below one hundred, 10% at one hundred to below three hundred, or thirty at three hundred or more, subject to statutory counting rules, with consultation and authority and employee notices preceding the dismissals. The temporary-agency chapter excludes the ordinary collective-redundancy sections, so establish the actual model before applying these thresholds.

Keep a fixed-term employer exit payment, notice pay, unused annual leave and statutory severance as four separate items. An EOR deposit does not settle them, and ordinary resignation does not create severance.

Hungary has two statutory floors rather than one, and the higher of them applies to the job rather than to the person. Get the classification right before quoting a salary.

Set the correct salary floor

Both floors took effect on 1 January 2026.

The ordinary full-time minimum gross base wage is HUF 322,800 per month, HUF 74,210 per week, HUF 14,850 per day or HUF 1,856 per hour, with part-time monthly, weekly and daily amounts proportionate to working time. Use the decree's rules for the agreed pay unit and for non-standard full-time hours.

A full-time job requiring at least secondary education or a secondary vocational qualification carries a guaranteed minimum gross base wage of HUF 373,200 monthly, HUF 85,800 weekly, HUF 17,160 daily or HUF 2,145 hourly. What triggers it is the job's qualification requirement rather than the employee happening to hold a degree, and higher contractual or applicable collective-agreement pay must be honoured regardless.

Working time and rest

Ordinary full-time work is eight hours a day, normally five days a week, and scheduled working time is generally limited to twelve hours a day and forty-eight a week including overtime, with lawful averaging and special categories. Supply the written schedule at least 168 hours in advance for a week's coverage, and note that qualifying unforeseen changes ordinarily require ninety-six hours. Collective agreements and special schedules need their own check.

Provide twenty minutes of break when daily work exceeds six hours and a further twenty-five minutes when it exceeds nine. Ordinary daily rest is eleven consecutive hours with regulated exceptions, and weekly rest is normally two rest days or forty-eight consecutive hours subject to the scheduling rules, so the entitlement is not one day off.

Keep accurate schedules and overtime records, remembering that special working-time arrangements, averaging periods and collective agreements change how the daily and weekly limits apply. A Saturday that appears in the official exchanged work schedule is not automatically overtime.

Overtime and other pay premiums

Ordinary ordered overtime is limited to 250 hours a year, with a separate written voluntary agreement able to add 150, or a collective agreement allowing 300 plus up to 100 voluntary hours instead. Proportionate limits and protected-worker restrictions apply. Ordinary overtime generally attracts a 50% premium or qualifying paid time off under the applicable agreement, while overtime on a weekly rest day attracts 100%, or 50% if another rest day is given.

Public-holiday work attracts a 100% premium, with an additional rule for public-holiday overtime. Sunday work does not always attract a premium: the 50% Sunday premium depends on the statutory circumstances, which is the detail most often assumed the other way. A qualifying rotating shift attracts 30% for work from 18:00 to 06:00, and qualifying night work of more than one hour attracts 15% where the shift premium is not due. Saturday work is not automatically overtime.

Check which premiums apply together and whether a lawful time-off or lump-sum arrangement exists. Public-holiday work cannot be treated as an ordinary day because the employer intends to give another day off instead.

Hungarian annual leave is built on the employee rather than on their tenure, which makes a candidate's age a budget input. Basic annual leave is twenty working days, age additions increase from one day in the year the employee turns twenty-five to ten days in the year they turn forty-five, and additional child, young-worker and disability entitlements can increase the total. Proportionate entitlement applies to partial years, and maternity leave and the first six months of unpaid childcare leave count for accrual.

Annual leave grows with age and family circumstances

Annual child-related extra leave is two working days for one child, four for two and seven for three or more, with a further two per qualifying disabled child, counting the child through the calendar year of the sixteenth birthday under the statutory rule. Other age or disability-related leave can apply separately.

The age ladder runs as follows.

After the first three months the employee can choose seven annual-leave days in no more than two blocks with fifteen days' notice, and the employer schedules the remaining leave after consultation. Unless agreed otherwise, provide a period of at least fourteen consecutive calendar days free from work, including rest days. Leave is normally used in its year, carryover requires a statutory ground or a permitted agreement, and unused ordinary annual leave is paid out on termination.

Worked through, an employee turning thirty-five during the year has twenty-five days before any child or other additions. Note the units: leave is expressed in working days, while the required fourteen-day uninterrupted break is measured in calendar days. Carryover is not open-ended either, since an employment start on or after 1 October allows use by 31 March and other exceptions carry their own conditions and deadlines.

Public holidays in 2026

Hungary has eleven statutory public-holiday dates, and a bridge-day system that moves working days around them.

For the ordinary work schedule in 2026, 2 January, 21 August and 24 December are additional rest days exchanged for working Saturdays on 10 January, 8 August and 12 December. Those exchanges do not create fourteen statutory holidays, and a payroll calendar that records only the days off will drift.

Record both sides of each exchange: 2 January off against 10 January work, 21 August off against 8 August work, and 24 December off against 12 December work. A weekend public holiday does not become a substitute Monday holiday.

Sick leave and sickness benefit

An employee ordinarily receives fifteen working days of sick leave a calendar year, proportionate in a starting year, paid by the employer at 70% of statutory absence pay, with medical certification required. Occupational injury, occupational disease and high-risk pregnancy follow different benefit rules rather than consuming ordinary sick leave.

After ordinary sick leave, eligible insured employees can receive taeppenz: generally 60% of the benefit base with at least 730 days of continuous insurance, otherwise 50%, with inpatient care generally at 50%. The daily 2026 cap is HUF 21,520, duration depends on coverage and prior claims and is generally no more than one year, and the employer contributes one-third of the benefit for the employee's own illness or inpatient care under the statutory rule. That employer third is the part most quotes leave out.

Maternity, paternity and parental leave

Maternity leave is twenty-four weeks, with at least two weeks taken. Eligible CSED normally requires 365 insured days in the preceding two years plus the current or recent coverage conditions, and the ordinary daily benefit is 100% of its statutory base. Working within the first ninety days after birth prevents CSED, and working after that reduces it to 70%, so treat the benefit calculation and the right to time off as two separate questions.

Paternity leave is ten working days, taken in up to two blocks at the father's request by the end of the fourth month after birth or the final adoption decision. The first five days carry full statutory absence pay and the remaining five carry 40%.

After one year of employment, an employee has forty-four working days of parental leave up to the child's third birthday, with statutory pay at 10% of absence pay, reduced by any GYED or GYES received for the same period.

Longer childcare leave and benefits

Unpaid childcare leave is normally available until the child turns three. Ordinary insured-parent GYED generally follows the CSED-equivalent period until age two at 70% of its benefit base, capped at HUF 451,920 gross monthly in 2026, with eligibility normally needing 365 insured days in the preceding two years. GYED carries no ordinary PIT deduction but generally a 10% pension deduction, subject to contribution relief, while GYES is a separate benefit at ordinarily HUF 28,500 gross monthly in 2026 with pension deduction, and special family cases differ.

Ordinary GYED can generally continue while the parent works, with special categories carrying their own conditions, and GYES and unpaid leave remain separate concepts. Give at least fifteen days' notice for unpaid childcare leave, and note that ending it normally takes effect no earlier than thirty days after the employee's notice. Coordinate the benefit claim, the return date and the accrued annual leave together.

Other time off and benefits

The Labour Code includes two working days off for a relative's death and five days annually for specified serious care needs, with different pay rules attached. After six months, qualifying parents of a child under eight and carers can request flexible arrangements and the employer must respond in writing within fifteen days. Mandatory half-time work also applies for eligible parents until the child is four, or six with three or more children.

Required expense reimbursement is a different category from optional perks, and it is a real obligation. Qualifying commuting tickets or passes under Government Decree 39/2010 generally require at least 86% employer reimbursement, with specific coverage, evidence and home-travel limits, while ordinary local travel is not universally covered. The employer must also reimburse necessary, reasonably incurred employment expenses under the Labour Code.

Discuss optional private medical cover, meals or SZEP-card benefits, extra leave and flexible working as part of the offer, and price the actual package with its tax treatment. Required commuting and employment-expense reimbursement should never be presented as a discretionary perk.