Hungary tightened sanctions regarding foreign workers, new amendments are coming

The government tightened the sanctions regarding the employment of foreign workers from third countries. The new modifications aim to safeguard Hungarian workers in cases where employers seek to replace their existing Hungarian workforce with foreigners. Further restrictions may be introduced in the future.

Protection from foreign workers

As 24.hu has reported, the cabinet has tightened the rules on foreign workers from 1st March. Imre Szilárd Szabó, lawyer and Executive Vice President of the National Federation of Workers Councils, explained the essence of these modifications as follows: To counteract exploitative practices by employers, a provision has been introduced empowering government authorities to revoke work permits if employers seek to replace Hungarian workers with third-country nationals without valid cause.

Increased penalties

The legislation overseeing the regulatory actions of the Employment Inspectorate has been revised to increase penalties for the unlawful employment of third-country citizens. This revision introduces a heightened labour penalty for violations concerning the failure to report the conclusion of employment contracts for migrant workers. Furthermore, a significant aspect of the enhancement involves raising both the minimum and maximum discretionary fines for labour violations.

The minimum fine has been raised fivefold to HUF 150,000 (EUR 379), with fines scaled according to business size. Larger enterprises face heftier penalties, with the maximum fine reaching HUF 25 million (EUR 63,152) for businesses employing at least 250 individuals.

Future amendments in Hungary

The government has accepted another initiative of the National Federation of Workers Councils. In the case of employment of third-country nationals, the employer must seek the opinion of the works council before employing them, provided foreign employees constitute at least 5% of the workforce or a minimum of 10 individuals. This proposed amendment is slated for inclusion in the Labour Code.

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Additionally, the union is contemplating a proposal to prohibit employers from hiring foreign workers if their average earnings are 20% below industry standards over the preceding six months, or if earnings for specific positions are 20% lower than the Central Statistical Office’s published tariffs for comparable occupations

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