Employment Lawyer in Hungary: How Legal Advice Can Help Employees and Employers

Why is professional employment law advice important?

Employment law affects one of the most important legal relationships in everyday life. For an employee, employment generally provides income, professional security and long-term stability. For an employer, the workforce is a central part of the organisation, operating model and cost structure.

A poorly drafted employment contract, an unlawful working-time arrangement, an inadequately documented performance problem or an incorrectly prepared dismissal may lead to substantial legal and financial consequences.

Employment disputes may also develop quickly, while strict and sometimes very short deadlines can apply. A delay in obtaining legal advice may result in the loss of a claim or in a decision that can no longer be easily corrected.

The role of an employment lawyer is therefore not limited to representing clients in court. Legal assistance may also include:

• preventing employment disputes;
• reviewing and drafting employment documents;
• identifying legal and commercial risks;
• supporting negotiations;
• preparing dismissals;
• enforcing salary and compensation claims;
• representing clients in authority proceedings;
• conducting employment law audits;
• providing ongoing legal support to HR departments and management.

Herdon Law Firm provides employment law advice and representation to both employees and employers. Our services are available in Hungarian and English and may include individual legal advice, document drafting, settlement negotiations, administrative proceedings and labour litigation.

What does Hungarian employment law regulate?

Hungarian employment law regulates, among other matters:

• the establishment of employment;
• the contents of employment contracts;
• the employer’s right to give instructions;
• salary and employee benefits;
• working time and rest periods;
• annual leave;
• liability for damages;
• occupational accidents;
• the termination of employment;
• collective employment relations;
• trade unions and works councils;
• temporary agency work;
• remote work and home office arrangements;
• occupational safety;
• labour authority proceedings;
• employment litigation.

The principal source of Hungarian employment law is Act I of 2012 on the Labour Code. Depending on the matter, other legislation, collective agreements, internal employer policies, the employment contract and the applicable case law may also be relevant.

When should an employee contact an employment lawyer?

It is advisable to seek employment law advice not only after a dispute has arisen. Early legal assistance may prevent a problem from escalating.

An employee should consider contacting a lawyer where:

• a new employment contract is offered;
• an executive or key employee position is proposed;
• the employer requests a non-compete or confidentiality agreement;
• a mutual termination agreement is presented for signature;
• a dismissal or immediate termination is communicated;
• salary, overtime, bonus or severance pay remains unpaid;
• a workplace accident or occupational illness occurs;
• the employee experiences discrimination or harassment;
• an internal investigation is opened;
• the employer claims damages;
• a labour authority or court procedure is expected;
• the employee is asked to sign a document that is unclear or potentially disadvantageous.

How can an employment lawyer help employees?

Reviewing an employment contract

An employment contract may appear to be a relatively short document, but its provisions can affect the employee for many years.

In addition to the job title and basic salary, the following provisions may be important:

• place of work;
• working schedule;
• probationary period;
• variable place of work;
• bonus or premium conditions;
• expenses and allowances;
• notice period;
• non-compete obligations;
• confidentiality;
• intellectual property rights;
• monitoring by the employer;
• remote working arrangements;
• liability provisions.

An employment lawyer can explain the practical legal consequences of the proposed terms, identify unclear or one-sided clauses and recommend amendments before signature.

Reviewing a mutual termination agreement

A document described as a “mutual agreement” is not necessarily equally favourable to both parties.

By signing such an agreement, an employee may waive rights or payments that could otherwise arise in the event of an employer’s dismissal. These may include:

• salary for the notice period;
• release from work;
• severance pay;
• bonus or premium entitlements;
• the possibility of subsequently challenging the termination.

Before signing, the employee should understand the financial and legal position that would arise without the proposed agreement.

A properly drafted mutual termination agreement should also address:

• the termination date;
• salary and benefits;
• unused annual leave;
• severance or additional compensation;
• return of company property;
• references and certificates;
• confidentiality;
• non-disparagement;
• outstanding expense claims;
• the settlement of potential legal claims.

Assessing the lawfulness of a dismissal

The lawfulness of an employer’s dismissal does not depend merely on whether the document contains some form of explanation.

It may be necessary to examine:

• whether the proper person exercised the employer’s rights;
• whether the notice was lawfully communicated;
• whether the reasons are clear, genuine and reasonable;
• whether statutory protection applied;
• whether the notice period was calculated correctly;
• whether severance pay is due;
• whether final salary and benefits were properly settled;
• whether compensation or another legal remedy may be available.

Claims relating to an unlawful termination of employment may be subject to a short, generally 30-day time limit. Employees should therefore obtain legal advice promptly after receiving a dismissal.

Immediate termination

Immediate termination is one of the most serious forms of ending an employment relationship. It is lawful only under strict conditions.

Relevant questions may include:

• whether a serious breach of obligation occurred;
• whether the conduct was intentional or grossly negligent;
• whether maintaining the employment relationship became impossible;
• whether the statutory deadline was observed;
• whether the grounds can be proven;
• whether the response was proportionate.

An employee may also terminate employment with immediate effect if the employer commits a serious breach of its obligations. However, an unjustified immediate termination by the employee may itself lead to liability. Legal advice should therefore be obtained before issuing such a notice whenever possible.

Unpaid salary, overtime and benefits

Common employment disputes concern the correct payment of:

• basic salary;
• overtime;
• shift allowance;
• night-work allowance;
• Sunday or public holiday allowance;
• standby or on-call payments;
• bonuses and premiums;
• absence pay;
• notice-period salary;
• severance pay;
• travel or other expenses.

An employment lawyer may review the employment contract, payslips, working-time records, schedules, attendance records, bank statements and the employee’s actual working arrangements.

Where appropriate, the employee’s claim can be calculated and presented through:

• a formal demand;
• settlement negotiations;
• a payment order where legally available;
• labour litigation;
• enforcement proceedings.

Working time and rest periods

Working-time regulation is one of the most complex areas of employment law.

Disputes may concern:

• what qualifies as working time;
• whether overtime was lawfully ordered;
• whether schedules were communicated in time;
• whether a working-time banking arrangement is valid;
• daily and weekly rest periods;
• work breaks;
• standby duty;
• on-call duty;
• working-time records;
• settlement at the end of a reference period.

The written records are important, but the actual manner in which the employee worked may also be decisive.

Severance pay

Severance pay is not automatically due whenever employment ends.

Entitlement may depend on:

• the method of termination;
• the length of service;
• the grounds for dismissal;
• whether the employee qualifies as a pensioner;
• the employee’s conduct or ability;
• any additional contractual agreement.

A lawyer can assess whether severance pay is due, whether the amount has been calculated correctly and what level of compensation may be reasonable in a mutual termination agreement.

Workplace accidents and employer liability

A workplace accident or work-related health impairment may raise employment law, occupational safety, social security and damages issues at the same time.

The assessment may include:

• how and where the accident occurred;
• whether it qualifies as an occupational accident;
• whether a proper risk assessment was available;
• whether occupational safety training was provided;
• whether appropriate equipment and protective devices were supplied;
• whether the work was properly organised;
• whether the employer breached a statutory duty;
• what financial and non-financial losses were suffered;
• whether the employee will have future loss of income or additional expenses.

Under Hungarian occupational safety law, the employer is responsible for ensuring safe and healthy working conditions. The employee’s own occupational safety obligations do not in themselves remove the employer’s responsibility.

An employment lawyer may assist with:

• preserving evidence;
• reviewing the accident report;
• assessing medical and occupational documents;
• calculating damages;
• communicating with the employer or insurer;
• settlement negotiations;
• court proceedings.

Discrimination and workplace harassment

Unlawful discrimination may occur where an employee is treated less favourably because of a legally protected characteristic.

It may arise in connection with:

• recruitment;
• salary;
• promotion;
• working conditions;
• access to training;
• disciplinary treatment;
• termination;
• pregnancy or parenthood;
• disability or health status;
• age;
• a hostile or humiliating work environment.

These cases often require a carefully prepared evidentiary strategy. Emails, messages, internal documents, witness statements and a detailed chronology of events may all be relevant.

Non-compete agreements

A non-compete agreement may limit an employee’s ability to work for competitors or establish a competing business after employment ends.

Before signing or enforcing such an agreement, it is important to examine:

• which activities are prohibited;
• the geographical scope;
• the duration;
• the compensation payable by the employer;
• whether the restriction is proportionate;
• contractual penalties or damages;
• whether the agreement may be terminated or modified.

A broadly worded restriction can seriously affect the employee’s future career. Legal review before signature is therefore strongly recommended.

Study agreements

A study agreement may require the employee to remain with the employer for a specified period in exchange for financial support, paid leave or other benefits.

Disputes may arise where:

• the training is interrupted;
• employment ends early;
• the employer requests repayment;
• the reimbursable costs are unclear;
• the employer failed to provide agreed support;
• the repayment obligation appears disproportionate.

The financial and time commitments should be clearly understood before the agreement is signed.

How can an employment lawyer help employers?

Employment law advice for employers is not limited to defending court claims. Appropriate legal support can help establish consistent HR practices, reduce financial exposure and prevent disputes.

Drafting employment documentation

An employment lawyer may draft or review:

• employment contracts;
• job descriptions;
• executive employment contracts;
• remote-work agreements;
• non-compete agreements;
• confidentiality clauses;
• study agreements;
• bonus and premium policies;
• employer information notices;
• internal employment policies;
• employee monitoring policies;
• company-device policies;
• termination documents.

Good documentation is not merely an administrative requirement. In a later dispute, it may be decisive whether and how the employer communicated expectations, rules and decisions to the employee.

Preparing dismissals

Termination is one of the highest-risk employment decisions for an employer.

Legal assistance may include:

• selecting the appropriate method of termination;
• reviewing the proposed grounds;
• collecting and assessing evidence;
• reviewing prior warnings;
• drafting the termination notice;
• checking statutory protection;
• calculating final entitlements;
• organising lawful delivery;
• preparing exit documentation;
• developing a settlement proposal.

Dismissals based on performance, conduct, medical fitness, redundancy or restructuring may require particularly careful preparation.

A well-drafted dismissal notice cannot always correct months of inadequate documentation. Early legal involvement is therefore often essential.

Managing performance and misconduct

Employers should establish clear and consistent procedures for handling performance concerns and alleged misconduct.

Legal support may help with:

• communicating expectations;
• performance improvement plans;
• written warnings;
• investigation procedures;
• giving the employee an opportunity to respond;
• proportionality of employer measures;
• documenting management decisions.

General, retrospective or unsupported allegations are typically more difficult to defend in litigation.

Working-time and remuneration structures

An employment lawyer may assist employers with:

• working-time banking;
• shift schedules;
• overtime procedures;
• standby and on-call arrangements;
• allowance structures;
• bonus and premium schemes;
• remote-working schedules;
• executive remuneration;
• key employee benefits.

These structures should be legally compliant, administratively manageable and compatible with the company’s actual operations.

Restructuring and redundancies

A reorganisation or collective redundancy involves more than preparing termination letters.

The process may require consideration of:

• the commercial decision and its documentation;
• selection criteria;
• the actual elimination of positions;
• consultation with the works council;
• notifications to authorities;
• employee consultation;
• protected employee categories;
• notice and severance payments;
• internal and external communications.

Proper legal planning may reduce the risk of several related employment claims being filed after the restructuring.

Employee liability for damages

Where an employee causes damage in connection with employment, the employer may need to prove:

• a breach of duty;
• fault;
• the existence and amount of loss;
• causation;
• the applicable level of liability;
• whether any limitation of liability applies;
• whether inventory liability is relevant;
• whether deduction from salary is lawful.

An employer cannot automatically deduct any disputed amount from an employee’s salary. The legal basis and method of enforcement must be assessed in each case.

Trade secrets and confidentiality

Employees may have access to customer lists, pricing, business plans, technical information, know-how or other confidential material.

An employment lawyer may assist with:

• identifying protected information;
• drafting confidentiality policies;
• regulating access rights;
• establishing exit procedures;
• handling company devices and data;
• preparing cease-and-desist letters;
• seeking interim measures;
• enforcing damages claims.

Effective protection requires more than a general statement that all company information is confidential. The employer should also implement reasonable practical measures to protect the information.

Internal investigations

Internal investigations may be necessary in cases involving:

• harassment;
• fraud;
• conflicts of interest;
• data loss;
• misuse of company property;
• breach of confidentiality;
• whistleblowing reports;
• health and safety incidents.

Legal support can help ensure that:

• the scope of the investigation is clear;
• evidence is collected lawfully;
• affected persons receive appropriate information;
• personal data is processed correctly;
• employee interviews are properly documented;
• any resulting employer measure is proportionate.

Labour authority and occupational safety inspections

During an authority inspection, the authorities may review:

• registration of employment;
• employment contracts;
• working-time records;
• payment of salary;
• annual leave;
• employment of young workers;
• occupational safety documentation;
• risk assessments;
• safety training;
• protective equipment;
• investigation of workplace accidents.

An employment lawyer may assist with preparation for the inspection, collection of documents, written submissions and review or challenge of the authority’s decision.

Labour litigation in Hungary

Not every employment dispute needs to be resolved in court. Depending on the matter, the following may provide a more efficient solution:

• a formal lawyer’s letter;
• direct negotiations;
• an out-of-court settlement;
• payment by instalments;
• amendment of employment terms;
• a properly structured mutual termination agreement.

Court proceedings may nevertheless become necessary where:

• the other party refuses to cooperate;
• liability or the amount claimed is disputed;
• an urgent remedy is required;
• a statutory deadline is approaching;
• settlement negotiations have failed.

A labour case is commenced by filing a statement of claim. Legal representation is not mandatory in every labour case, but professional assistance may be highly valuable because of the procedural, evidentiary and substantive complexity of employment disputes.

An employment lawyer may:

• identify the legal basis of the claim;
• check statutory deadlines;
• organise evidence;
• prepare the statement of claim or defence;
• request interim measures;
• propose witnesses and experts;
• represent the client at hearings;
• assess settlement offers;
• prepare an appeal or other legal remedy;
• assist with enforcement of the final decision.

What evidence may be important?

Employment disputes often depend less on what a party believes to be fair and more on what can be proven.

Relevant evidence may include:

• the employment contract and amendments;
• job descriptions;
• internal policies;
• termination notices;
• emails and messages;
• payslips;
• bank statements;
• working-time records;
• schedules;
• access-control data;
• performance reviews;
• warnings;
• medical records;
• workplace accident reports;
• photographs and videos;
• witnesses;
• authority documents;
• internal investigation records.

Evidence must be collected and used lawfully. Particular care is required in relation to recordings, personal data, company information and trade secrets.

Common mistakes made by employees

Employees may weaken their legal position by:

• signing a mutual agreement immediately;
• failing to retain copies of documents;
• making claims only verbally;
• deleting messages or payslips;
• waiting too long before seeking advice;
• missing a statutory deadline;
• sending offensive or threatening messages;
• making serious allegations without evidence;
• unlawfully copying company data;
• refusing work without a proper legal basis;
• issuing an immediate termination without legal review.

Common mistakes made by employers

Frequent employer-side mistakes include:

• generic or inaccurate employment contracts;
• missing job descriptions;
• inadequate working-time records;
• unpaid overtime;
• undocumented performance problems;
• creating dismissal reasons retrospectively;
• termination signed by an unauthorised person;
• unlawful salary deductions;
• unclear bonus policies;
• disproportionate employee monitoring;
• incomplete occupational safety documentation;
• inadequate accident investigation;
• failing to identify protected employees;
• late delivery of exit documents and payments.

Many of these risks can be reduced through proper documentation, regular legal reviews and early employment law advice.

Employment law audits for businesses

An employment law audit examines whether the employer’s practices comply with applicable rules and identifies potential financial, litigation and authority risks.

The review may cover:

• employment contracts;
• job descriptions;
• working-time arrangements;
• overtime payments;
• remuneration and bonus systems;
• executive contracts;
• non-compete arrangements;
• remote work;
• employee monitoring;
• internal policies;
• occupational safety documentation;
• temporary agency workers;
• foreign employees;
• pending and potential disputes.

An employment law audit may be particularly useful before:

• a company acquisition;
• an investment;
• restructuring;
• management changes;
• a labour authority inspection;
• expansion into Hungary;
• introducing a new working-time or remuneration system.

Ongoing employment law and HR support

For many employers, ongoing legal support is more effective than consulting a lawyer only after a dispute has arisen.

Regular employment law support may include:

• answering day-to-day HR questions;
• drafting contracts and amendments;
• reviewing employer measures;
• preparing dismissals;
• updating internal policies;
• handling employee complaints;
• supporting management decisions;
• preparing for authority inspections;
• providing employment law training;
• advising on legislative changes.

International employment and foreign employees in Hungary

International employment may involve Hungarian labour law, immigration law, tax, social security and private international law at the same time.

Typical questions include:

• which country’s law applies;
• whether a Hungarian employment contract is required;
• how a foreign national may be employed in Hungary;
• whether an assignment qualifies as a posting;
• where social security contributions are payable;
• which language should be used for employment documents;
• how remote work from another country should be regulated;
• how the employment of a foreign worker may be terminated;
• what obligations apply to a Hungarian host company.

Herdon Law Firm provides Hungarian and English-language employment law services to employees, Hungarian companies and foreign-owned businesses operating in Hungary.

Success fee and hybrid fee arrangements

In appropriate employment law matters, all or part of the lawyer’s fee may be linked to the outcome of the case.

Such matters may include:

• unpaid salary;
• severance pay;
• unlawful termination;
• compensation following a workplace accident;
• employer damages claims;
• non-pecuniary damages;
• non-compete compensation;
• other sufficiently documented monetary claims.

Possible fee structures include:

• a success-fee-only arrangement subject to appropriate security;
• a reduced fixed fee plus a success fee;
• a reduced hourly rate plus a success fee;
• fees linked to individual procedural stages.

Success fee representation is subject to a preliminary legal, evidentiary and commercial assessment. A success fee arrangement does not guarantee the result of the matter.

Why choose Herdon Law Firm?

Employment law is one of the principal practice areas of Herdon Law Firm.

We advise and represent:

• employees;
• executives and senior employees;
• employers;
• Hungarian businesses;
• foreign-owned companies;
• investors and corporate groups.

Our employment law services include:

• legal advice;
• contract and policy drafting;
• dismissal and settlement review;
• salary and severance claims;
• workplace accident matters;
• damages claims;
• labour litigation;
• out-of-court negotiations;
• authority proceedings;
• internal investigations;
• employment law audits;
• ongoing HR legal support;
• advice in Hungarian and English.

Our objective is not merely to provide an abstract legal answer. We aim to develop a practical solution that reflects the client’s commercial, professional and personal interests, the available evidence, the expected costs and the realistic outcomes of the matter.

Frequently asked questions

Is a lawyer mandatory in Hungarian labour litigation?

Legal representation is not mandatory in every labour case. However, strict deadlines, procedural requirements and evidentiary issues can make professional representation highly valuable.

Should I sign a mutual termination agreement immediately?

No. An employee is generally not required to sign immediately. The financial and legal consequences should be reviewed before signature.

How long do I have to challenge a dismissal?

A claim concerning the unlawful termination of employment is generally subject to a 30-day time limit calculated from communication of the relevant measure. Other employment claims may be governed by different deadlines.

Can I claim unpaid overtime?

Yes, provided that the overtime and its extent can be established. Working-time records, emails, schedules, access-control data, messages and witness evidence may all be relevant.

Is severance pay due under a mutual termination agreement?

Statutory severance pay is not automatically due merely because the parties sign a mutual agreement. The parties may nevertheless agree on severance-equivalent or higher compensation.

What should I do after a workplace accident?

Obtain medical assistance, report the accident, preserve documents and evidence, record the circumstances and avoid signing inaccurate or unclear documents without legal review.

Can an employment lawyer negotiate a settlement?

Yes. Many employment disputes can be resolved more quickly and economically through properly prepared lawyer-to-lawyer negotiations than through prolonged litigation.

Can an employer deduct alleged damages from salary?

An employer cannot automatically deduct any disputed loss from salary. A lawful legal basis and the statutory conditions for deduction must exist.

When should an employer involve a lawyer in a dismissal?

Preferably before the decision is finalised and before the reasons are communicated. Early review allows the legal basis, evidence, protected status and financial settlement to be checked.

Contact an employment lawyer in time

Timing may be decisive in employment law matters. A signed agreement, a missed deadline, an inadequately documented employer decision or an incorrectly prepared termination may be difficult to correct later.

Herdon Law Firm provides employment law advice, document drafting, negotiation support, representation before authorities and labour litigation services to both employees and employers. Success fee or hybrid fee arrangements may be available in appropriate cases.

For an initial legal assessment, it is useful to provide:

• the employment contract;
• the termination notice or disputed document;
• relevant correspondence;
• payslips and working-time records;
• a brief chronological summary;
• information about any applicable deadline.

This article provides general information only and does not constitute individual legal advice, a binding offer or a guarantee of any outcome. Employment law matters must be assessed on the basis of their individual facts, the applicable law and the available evidence. Acceptance of an engagement is subject to a conflict-of-interest check, client identification and a written engagement agreement.