In 2012, Hungary introduced a new Labour Code. Replacing the post-communist 1992 Code, the 2012 Code is a comprehensive re-regulation of Hungarian labour law which also reflects its membership of the European Union and international labour trends. It’s aim was to introduce a more flexible regulatory regime which would help Hungarian businesses to become more competitive.
It has increased the availability of measures for firms to cut cost and it has shifted some of the employment risks from the employer to the employee.
The new code has also weakened the position of the trade unions in the workplace while at the same time increasing the importance of works councils in firms that employ more than 50 people. Works councils and employers have freedom to reach agreements that will facilitate their co-operation.