Employee Benefits in Hungary

Bonuses and additional payments

In Hungary, there is no statutory requirement for employers to provide annual bonuses. However, employers may offer bonuses at their discretion, often based on company performance or individual agreements.

Annual leave

Employees in Hungary are entitled to paid vacation leave after completing one year of service. The statutory entitlement is 20 working days per year, with additional days granted based on the employee’s age, increasing by one day every three years from age 25, up to a maximum of 10 extra days at age 45. This leave is fully paid and can be taken throughout the leave year, as agreed between employer and employee.

Additional leave may be offered as part of an employment contract, though it is not required by law. Many employers offer enhanced leave policies to stay competitive and improve retention.

Unused statutory leave must be taken within the calendar year it is earned. Payment in lieu of unused leave is only permitted upon termination of employment.

Sick leave

In Hungary, personal and sick leave are governed by the Labour Code. Employees are entitled to up to 15 working days of paid sick leave per year, during which they receive 70% of their salary, paid by the employer. If the illness extends beyond 15 days, the National Health Insurance Fund provides further compensation. Employers may offer more generous sick leave policies through employment contracts or collective agreements.

Parental leave

Employers must provide 24 weeks of paid maternity leave, with mothers entitled to a maternity allowance paid by the Hungarian State Treasury, provided they meet the eligibility requirements based on their social insurance contributions.

Pregnant employees who have contributed to the social insurance system are eligible for benefits, with written notice required prior to the expected delivery date.

Additional benefits

Employees who are dismissed after at least three years of service are entitled to severance pay, calculated based on their length of service and monthly salary.

Additional benefits such as pensions and healthcare are funded by payroll contributions, which are covered in the Employment Law section.

We can consult with you about supplemental coverage options, such as additional pension contributions or life insurance, if needed. Free public healthcare coverage is provided to all Hungarian residents through the National Health Insurance Fund (NEAK), but many individuals opt for private healthcare to access a broader range of services and reduced wait times.

As your employer of record in Hungary, we may be able to provide optional supplementary medical insurance coverage for professionals and their dependents at a more cost-effective rate.