Life under quarantine: Home office or compulsory vacation Rights and obligations of Employers and Employees in Hungary

Humanity is facing the greatest challenge of the 21st century. As always, our office is at your full disposal to digitally serve you with highest professional care, diligence and proven commitment. We realize that your queries are of larger importance and of higher urgency than ever. “There will always be rocks in the road ahead of us. They will be stumbling blocks or stepping stones; it all depends on how you use them.” (Friedrich Nietzsche) 1. What are the conditions for the Employer to instruct and for the Employees to request home office? On 18 March the Government Decree 47/2020. (III. 18.) on immediate action to alleviate the impact of the coronavirus epidemic on national economy enabled Employers to take necessary and adequate steps in order to monitor the health status of the Employees and if appropriate, to order telework and home-based work for an indefinite period of time, without having to amend the employment contract for this purpose or requiring the Employee’s consent to relocation. Not even a consent by any Employees are required for this any longer. In addition, the Employer is no longer required to announce the change in the employment schedule 96 hours prior to the commencement of work. Moreover, Employers and Employees may further agree on possible deviations from the provisions of the Labor Code. Otherwise – in the hope that life will soon return to normal – Employers are entitled to instruct the Employees to work from home, but only for up to 44 working days, or 352 working hours per year. An agreement between Employee and Employer would be required to surpass these thresholds, while in case of the following categories of Employees: (i) pregnant Employees up until child reaches three years of age; (i) single parents, until the child reaches sixteen years of age; (iii) Employee providing long-term care for a close relative in person and (iv) Employee with a serious of health impairment is generally, a consent would always to be needed. Employees, who may not appear for work, because there is no school or care location provided for their children (without symptoms of illness) and for whom a home office as per the new government decree may not be established, can use their annual paid vacation for this purpose. They may use seven days of their annual vacation at times of their own choice (upon notice thereon to the Employer at least 15 days in advance), the remaining dates will by law be set by the Employer. Save for strict statutory exceptions (e.g. Employees with a child under the age of three years), Employees are not entitled to unilaterally use unpaid vacation. This option is subject to the agreement of the parties. 1. What are Employees’ obligations in the event of a quarantine of Employees? The Hungarian Labor Code and other acts or not familiar with the term „voluntary quarantine“ and Employees concerned – e.g. if they return from a high risk region – are in general not entitled to abstain from rendering work or to request sick leave. Within the meaning of labor law, a „voluntary quarantine“ may only be performed in the form of paid or unpaid vacation. Pursuant to the latest government decree no. 47/2020. (III. 18.) the Employer may take necessary and adequate measures in order to monitor the health condition of Employees. Accordingly, a voluntary quarantine ordered by the Employer may be regarded from a legal point of view as a release of the Employee from work along with payment of salary or as ordering of home-based work. In case of a quarantine ordered officially (in Hungarian: járványügyi zárlat) during an epidemic qualifies as per Section 44 g) of the act on social security as paid sick leave only if the Employer cannot offer any other options for performance of work. Consequently, an Employer needs in first place to review alternative options of performance of work (home office). If no such options are available, the Employee may claim continued payment of salary as if he/she was on sick leave. However, if the Employee is „separated“ from a medical point of view in a mandatory quarantine during a quarantine ordered officially (in Hungarian: elkülönítés), he/she qualifies as uncapable of work due to illness and has no option to work in home office during the paid sick leave. In case the government orders the closure of a facility or orders a curfew, whereby the Employees cannot access the place of work even without a quarantine, pursuant to the applicable interpretation, in such a situation Section 44 g) of the act on social security shall apply accordingly, i.e. in case the Employer cannot provide for the conditions of home office, Employees may request paid sick leave. According to a different (conservative) approach, such an event qualifies as force majeure event. Pursuant to Section 146 (1) of the Hungarian Labor Code the Employer would be exempted from its obligations in such event and the Employees would not have a claim for payment of their (base) salary. 2. What kind of state subventions or economic concessions exist at the moment? By way of the government decree no. 47/2020. (III. 18.) immediate measures were ordered for the purpose of mitigating the effects of the coronavirus pandemic on the national economy, to mitigate the Employers’ obligations to pay direct taxes and allowances: • these apply to tourism, hospitality industry, entertainment, gambling, movie industry, performing arts, event and sport; • tourism undertakings are exempt from paying indirect sector-specific taxes; • in the protected branches/sectors mentioned above, lease agreements for lease of non- residential premises may not be unilaterally terminated until June 2020; • small businesses in the sector of passenger transportation are exempt from paying sector- specific taxes between March and June 2020. The period of concessions may be extended with regards to the enduring pandemic. Further changes in the legal environment are expected in order to counterbalance the health and economic situation triggered by COVID-19.

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