Due to the recent mandatory closure of retail shops on Sundays, several regulations have entered into force or been modified. This update focuses on the employment aspects of these modifications.

Background

On March 15 2015 a new act entered into force which introduced new rules governing the opening times of retail shops. The new act brought two significant changes that are intended to preserve employees' rights and allow them more time to rest:

  • a prohibition against retail shops opening on Sundays; and
  • a rule that retail shops may operate only between 6:00am and 10:00pm on all other days of the week, excluding public holidays (on which they must remain closed).

There are several exceptions to these general rules. In particular, certain types of retail shop may operate on Sundays (eg, pharmacies and bakeries). Moreover, retail shops in certain designated places (eg, airports, railway stations and hospitals) do not fall under the Sunday closure requirement.

Smaller grocery shops with a sales area below 200 square metres also do not fall under the closure requirement, provided that their sales personnel consist of an owner holding at least a 20% interest in the shop and his or her family members. Apart from an owner and his or her family, no sales personnel may work in these retail shops on Sundays.

However, the new rules do not completely exclude the possibility for retail shops falling under the closure requirement to use employees on Sundays in other positions, particularly for preparatory work (eg, loading and movement of goods).

Further, there are some Sundays in the calendar year on which all retail shops will be allowed to operate, including the four Sundays before Christmas and one additional Sunday per year that the individual shops may freely select.

Compensation for Sunday work

The March 2015 amendment to the Labour Code regulates the labour law consequences of the new statutory opening times.

Previous regime
The previous regulations provided for extra compensation for Sunday work (a wage supplement of 50% above the normal wage) for certain employee groups, although other employee groups (ie, those where the nature of the job typically implied Sunday work) were not entitled to this wage supplement.

Employees working on Sundays as part of their normal working schedule or as overtime were entitled to the 50% wage supplement if they were:

  • employed in shifts;
  • employed in standby jobs; or
  • working for employers engaged in commercial activities covered by the Trade Act.

Employees working in the retail sector (ie, sales personnel employed in retail shops) fell within the latter category and were thus entitled to the wage supplement.

Employees who were not required to perform work on Sundays as a part of their regular work schedule (ie, those who worked overtime on Sundays) were also entitled to the wage supplement.

New regime
Following the entry into force of the new act, the regulations remain unchanged in that not all employees working on Sundays are entitled to the wage supplement, which remains generally applicable to employees working in the retail sector.

According to the recent amendment to the Labour Code, employees working on a Sunday in a retail shop that is normally subject to the closure requirement will be entitled to an additional 50% wage supplement (making a total wage supplement of 100%) if they are required to work on Sunday as part of their normal working hours or as overtime.

Under the new rules, this higher compensation will be payable to employees who work:

  • in retail shops on Sundays on which shops may operate freely (eg, the four Sundays before Christmas); and
  • in retail shops subject to the Sunday closure requirement in positions not directly related to sales activities.

The new act aims to emphasise the extraordinary nature of Sunday work in the retail sector and further encourages employers subject to the closure requirement to give employees Sundays off by setting a higher statutory compensation rate for Sunday work.

Employees working in retail shops that do not fall under the closure requirement may still be required to work on Sundays, but will be entitled only to the original 50% wage supplement above their normal wage.

No change has been made in relation to compensation for work performed on public holidays; a 100% wage supplement will continue to be payable to employees for work undertaken during these periods.

Comment

The original proposal to introduce the Sunday closure requirement was heavily criticised and provoked heated debate in Hungary. Many observers regard the new rules as running against both international trends and the traditional habits of Hungarian society. Others point out that other EU member states also restrict work on Sundays. Trade unions had argued that employees in the retail sector would lose part of their income by being unable to work on Sundays for extra money. The new amendment to the Labour Code intends partially to address this criticism by increasing the statutory compensation for these employees if they need to work on Sunday.

According to a recently published poll, approximately 60% of Hungarians disapprove of the new act. It remains to be seen whether this will lead the country's policymakers to reconsider the Sunday closure rule.

For further information on this topic please contact Kinga Hetényi or Dániel Gera at Schoenherr Rechtsanwälte by telephone (+36 1 345 87 78) or email (k.hetenyi@schoenherr.eu or d.gera@schoenherr.eu). The Schoenherr Rechtsanwälte website can be accessed at www.schoenherr.eu.

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