If you operate a business in Hungary, sooner or later you might need your employees to do overtime for you. But how does that work? When can you expect it, and how much will it cost you? Read on to find out.
Regular working hours and overtime
Regular working time for a full-time employee is 8 hours a day, 40 hours a week, with at least 20 days of paid leave every year (it can be more based on age and other factors). As an employer, it is your right and duty to allocate working hours and most of the employees’ vacation days (although employee preferences are usually taken into account when managing vacation days).
Above regular working hours, you can have your employees do overtime with the following limits:
- an employee can work at most 12 hours a day, or 48 hours a week
- the total number of yearly overtime hours normally cannot be more than 250 hours
- however, if your employees have a collective agreement, it can stipulate 300 hours of yearly overtime instead
- “voluntary overtime” is also possible, which bumps up the maximum number of overtime to 400 hours
At the same time, you cannot expect overtime from employees who are:
- mothers from pregnancy until the child turns 3
- single parents with a child under 3 (between the age of 3 and 4, they can do voluntary overtime)
Compensation and wage supplements
Overtime must always be compensated. There are two ways to compensate for overtime:
- wage supplement
- paid free time
If overtime was allocated on an otherwise regular working day, you either pay a 50% wage supplement for the hours spent doing overtime work, or you allow you employee to have at least as much free time as they spent in overtime before the end of the following month.
For example: At your company, normal working hours are Monday – Friday, 8 am – 4 pm. Regular hourly pay is HUF 2,000. You need an employee do 4 hours of overtime on a Friday evening.
- You either pay the wage supplement: 4 hours * HUF 3,000 = HUF 12,000;
- Or you give them some free time, and on Monday your employee can come in to work at noon instead of 8 am; in this case, you do not have to pay extra above their regular salary.
If overtime was allocated on an otherwise rest day or holiday, you either pay a 100% wage supplement for the hours spent doing overtime work, or you allow you employee to have at least as much free time as they spent in overtime before the end of the following month and pay a 50% wage supplement.
For example: At your company, normal working hours are Monday – Friday, 8 am – 4 pm. Regular hourly pay is HUF 2,000. You need an employee do 4 hours of overtime on a Saturday afternoon.
- You either pay the wage supplement: 4 hours * HUF 4,000 = HUF 16,000;
- Or you give them some free time, and on Monday your employee can come in to work at noon instead of 8 am; in this case, you still pay a wage supplement above their regular salary: 4 hours * HUF 3,000 = HUF 12,000.
Overtime can also apply if your employee works with allocated cumulative working time. In this case, the same rules apply, and if you choose free time in exchange for overtime, the free time must be allocated by the end of the next 16-week work period.
Consult your payroll specialist or your accountant
Having your employees doing overtime requires complex planning and budgeting. Before you start allocating overtime work, ask your accountant or your payroll specialist about the required compensation in free time and wage supplements. Note that wage supplements apply to various other types of work, e.g. working nights, in shifts, or on standby.
The Helpers Team offers not only assistance with work permit application, but also with onboarding, HR support, and payroll administration alongside our accounting and company setup services. We can help you make sure that your business operation remains compliant with Hungarian regulations while you are always on top of your finances.