TL;DR, Hiring in Hungary
- Fully-loaded employer cost: 13% flat (szociális hozzájárulási adó), no cap, no brackets
- Vocational training contribution absorbed into the 13% rate from 2022
- Strict Labour Code (Act I of 2012); termination requires written justification
- 9% flat personal income tax + 18.5% employee social, among lowest gross-to-net wedges in EU
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Statutory employer costs in Hungary
In Hungary, the employer's only statutory contribution is the szociális hozzájárulási adó (social contribution tax) at a flat 13% of gross salary, with no cap and no brackets. The vocational training contribution was absorbed into this rate in 2022. Severance under the Labour Code is tenure-stepped (1–6 months) and applies only to employer-initiated dismissal of indefinite-term contracts.
| Contribution | Employer rate | Notes |
|---|---|---|
| Szociális hozzájárulási adó (social contribution tax) | 13.0% | Flat, no cap, no brackets. Covers pension, health, unemployment, and family-support funds in a single combined levy since 2019. |
Mandatory employee benefits
Beyond statutory contributions, Hungary law requires the following benefits the employer must fund.
- Annual leave
- Base 20 days, rising by age: +1 day at 25, scaling to +10 days at 45+ (so 30 days total at age 45+). Plus additional days for parents (+2 for one child, +4 for two, +7 for three+).
- Public holidays
- 11 statutory days. If a holiday falls on Tuesday/Thursday, government may decree bridging Saturday work-day swaps.
- Sick pay
- Days 1–15: employer pays 70% of absent-day base salary. From day 16: state covers 60% (or 50% if hospitalised) up to 1 year per illness.
- Cafeteria benefit (SZÉP card)
- Tax-advantaged employer benefit up to HUF 450k/year (2025) loaded onto SZÉP card (split across hospitality, accommodation, recreation sub-accounts). Near-universal in white-collar offers.
Termination, notice and severance
Probation
Maximum 3 months (extendable to 6 months by collective bargaining agreement). Either party may terminate without reason during probation.
Notice period
Minimum 30 days, extended by tenure under Labour Code §69: +5 days at 3 years, +15 at 5, +20 at 8, +25 at 10, +30 at 15, +40 at 18, +60 at 20 years. So a 20-year veteran requires 90 days' notice.
Severance
Statutory severance under §77 applies only to employer-initiated dismissal of indefinite contracts after 3+ years tenure: 1 month at 3 years, 2 at 5, 3 at 10, 4 at 15, 5 at 20, 6 at 25 years. Doubled if employee is within 5 years of retirement age. No severance for employee resignation or termination by mutual agreement.
Common compliance pitfalls
- Labour Code §66 requires that any termination of an indefinite contract include a clear, written justification (real, reasonable, demonstrable). Vague reasons like 'restructuring' without supporting documentation are routinely overturned by Munkaügyi Bíróság (labour court).
- Hungary has unusually long tenure-based notice periods. A 20-year hire requires 3 months' notice plus 6 months' severance, 9 months of total wages on exit. EOR users should model this for senior hires.
- SZÉP card cafeteria benefit is not statutory but baked into market expectations. Offers without it lose to direct hires from competitors.
- Foreign-currency salaries: contracts denominated in EUR or USD are legal but social-security contributions must still be calculated and remitted in HUF using the MNB official rate on the payday. FX volatility creates contribution-base drift that EORs sometimes mis-handle.
Frequently asked questions
EOR platform fees for Hungary range from $199–$699 per employee per month. On top, employer szociális hozzájárulási adó adds a flat 13% of gross salary with no cap. Total statutory employer burden is among the lowest in the EU. Hungary is consequently popular for cost-arbitrage hires from Western European HQs.
The 2019 reform consolidated all employer-side social contributions (health, pension, unemployment, vocational training, family-support) into a single 17.5% szociális hozzájárulási adó. Successive Orbán-era reductions cut it to 13% by 2022. The trade-off is a flat 9% personal income tax that the employee bears, pushing the social-security burden onto employees rather than employers.
Under Labour Code §69 and §77, notice and severance both scale with tenure. A 10-year employee on indefinite contract requires 45 days' notice plus 3 months' severance on no-fault dismissal; a 20-year veteran needs 90 days' notice plus 5 months' severance. Total cost can reach 8 months' salary for long-tenured hires; model this when planning senior EOR hires.
Not legally, but near-universally in white-collar offers. The SZÉP cafeteria benefit allows tax-advantaged loading of up to HUF 450,000/year (~€1,150) onto a three-pocket card for hospitality, accommodation, and recreation. Anything above the cap is taxed as ordinary income. Skipping SZÉP makes EOR offers look substandard versus direct competitors.
Not on an indefinite contract. Labour Code §66 requires written, real, and reasonable justification (organisational reasons or employee conduct/capacity). Vague or pretextual reasons are routinely overturned by labour courts (Munkaügyi Bíróság), with reinstatement plus 12 months' back pay. Mutual-agreement separations remain the cleanest exit path.
Sources
Statutory rates and rules verified against the following authorities. We update this page when rates change.