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The amendment of the Hungarian Labour Code

With the effective date of 01 January 2015 some provisions the Labour Code (Act No 1 of 2012) have been amended, as follows:
According to the previous provisions, based on the respective request of an employee, an employer was obliged to amend the working time of the employee to part time (half of the general full working time) provided that his or her child was younger than the age of three. From 01 January 2015 on, this provision has been extended so that if an employee is caring for three or more children, the obligation concerning the amendment of the working time to part time employment shall be applied until the age of five of the child. As this new rule introduced the definition of the “employee caring for three or more children”, the Labour Code now includes the definition of the employee who shall belong to the above category. Accordingly, an employee caring for three or more children shall be, any person who as a parent – within the meaning of the Act on Family Support –
i. is eligible for family allowance and receives or received childcare fee or childcare allowance, or
ii. received or receives child-rearing allowance.

The rules concerning the eligibility for annual leave have also been amended, accordingly an employee shall accrue holidays during the entire term of the sick leave, i.e. the previously applied 30 days limit have been abolished from the Labour Code.

According to the amendments, the employment contract of an executive employee cannot deviate from the provisions set out in Section 65 (3) a), b) and e) of the Labour Code. This means that employees receiving treatment related to a human reproductive procedure as specified in law (i.e. employees are protected during the treatment for a maximum of six months from the date the treatment begins) shall be considered as protected employees and therefore, the employer cannot terminate their employment during this period. (The termination protection rules set out in Section 65 (3) a) and b) of the Labour Code have already been applicable also to executive employees even before 01 January 2015.) The parties cannot deviate from this provision even with their consent in the frame of the employment contract.

Should you have any questions regarding the above, please feel free to contact us.

Dr. Marianna Csabai
Dr. Boglárka Kricskovics-Béli
Dr. Nóra Óváry-Papp

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The amendment of the Act on Health Insurance

Act No. 111 of 2014 about the amendment of certain health and health insurance acts adopted on 16 December 2014 (“Amendment Act“) affected various Hungarian laws. In the frame of this present newsletter we summarize only the most significant amendments of those which affect Act No. 83 of 1997 on the services of the mandatory health insurance (“Health Insurance Act“). Additional provisions of the Amendment Act will be discussed by us in a separate newsletter.

As a consequence of the Amendment Act, the definitions set out in the Health Insurance Act were extended with the definition of income, monthly contractual income and salary, further, this part of the Health Insurance Act listed the financial health care allowances. These are infant care fee – instead of the previously applied maternity pay, which shall be only considered as an amendment in the name of the allowance -, childcare fee and sick pay.

According to the Amendment Act when defining the aforementioned financial health care allowances, further, (irrespective of certain exemptions) the sick pay payable on account of accident, the reported income – reached in any relationship effective on the date of the eligibility – serving a basis for determining the personal income before tax shall be taken into consideration instead of the income reached in a relationship on the basis of which the affected person should have been considered as insured.

It was added to the Health Insurance Act, that the eligibility for infant care fee shall begin on the date of the childbirth, or on the first date of the maternity leave in case of premature child, the latest.

The amount of the infant care fee and the childcare fee remained unaltered, however, the calculation of the income serving basis for the payment of the above fees – to which the rules defining the sick leave pay shall still apply – have been amended. Accordingly, in case of a continuous relationship the amount of the sick leave pay shall not be defined based on the daily average of the income gained in the year preceding the eligibility date for the sick leave pay. According to the Amendment Act, as a general rule, the basis for sick leave pay shall be defined on the basis of the average daily income accrued in a 180 days period between the first day of the year preceding the date of being eligible for the sick leave pay and the last date of the third month preceding the eligibility date. For example: if the eligibility date of the sick leave pay is 15 June 2015, the period between 01 January 2014 and 31 March 2015 shall be reviewed and the income gained within 180 days before 31 March 2015 shall be the basis for the calculation of sick leave pay.

By sustaining the current structure, the Amendment Act sets out those cases when the insured person does not have either 180 days income, or 120 days income – that shall already been considered as an exceptional case.

According to the provisions of the Amendment Act, the detailed rules of defining and calculating the infant care fee and the sick leave pay will be included in a Government Decree.

A significant amendment is included in the Amendment Act, namely, that if any of the parents shall be considered as sick on account of caring for and staying with his or her child in the course of a treatment rendered in a hospital, the amount of the sick leave pay shall be 50% of the sick leave base instead of the previously applied 60%.

The rules concerning childcare fee have also been amended. Accordingly, the mother or that person who was eligible to an infant care fee and whose insured status terminated while being eligible for infant care fee, shall receive childcare fee, provided that the eligibility for infant care fee was acquired during a relationship on the basis of which this person was insured and lasted for at least 365 days within the two years prior to the child’s birth, further, if the child is raised in his or her household.

If on the date being eligible for childcare fee or two years before this date a person is or has already been eligible for childcare fee with regard to his or her other child, the period of payment of childcare fee:

  • cannot be shorter than the defined period of the childcare fee, paid the latest, further
  • cannot be extended with the infant care fee’s payment period for which the parent is eligible on account of the second child; further
  • cannot be extended with the payment period of the childcare fee and childcare allowance defined on account of the birth of the last child.

These provisions of the Amendment Act entered into force with the effective date of 1 January 2015.

Should you have any questions regarding the above, please feel free to contact us:

Dr. Marianna Csabai
Dr. Boglárka Kricskovics-Béli
Dr. Nóra Óváry-Papp

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