6. Flexible working arrangements in Hungary

Flexible working helps workers organise paid hours around care obligations, can reduce their commute times, and can allow them to remain closer to dependent family members if regular caregiving is needed (OECD, 2017[1]). Greater access to flexible practices can reduce the number of workers who experience stress at home and/or at work, diminish absenteeism and increase productivity (Bond and Galinsky E., 2011[2]). However, there can be a negative stigma related to the idea that workers who use flexible working for care purposes are not as productive or committed (Chung, 2020[3]). Moreover, boundaries between work and private life may become more diffuse (OECD, 2021[4]), and the care burden for teleworking parents can increase, if no childcare is available.

Regular part-time work is one of the most commonly used forms of working-time flexibility and it helps many parents to match work and family life (see Sections 2.3 and 3.5). But flexible working also includes measures such as flexible starting and finishing times (flexitime), working “compressed” work weeks, and home working (teleworking) – which experienced a surge during the COVID-19 crisis (OECD, 2021[4]). Surveys conducted in mid-April 2020 show that the share of workers working from home ranged from little less than 30% in Sweden, Canada and Poland to around 50% in Australia, the United Kingdom and the United States and 60% in New Zealand (OECD, 2020[5]).

While flexible working practices are often set at the firm level or through collective agreements, OECD governments are increasingly looking to facilitate access by providing workers with the right to (request) certain arrangements (OECD, 2016[6]; OECD, 2017[1]). Several OECD countries have introduced broader rights to request flexible working arrangements including not just the number of working hours, but also, in some cases, the scheduling of hours and the place of work. In many OECD countries (e.g. Australia, Austria, the Netherlands, New Zealand, Norway, Portugal, Sweden and the United Kingdom), workers have a statutory right to request reduced working hours. In some of these countries, they also have a complementary right to return to full-time work and/or to previous hours after a specific period. In some countries, these rights are restricted to parents with young children and/or workers with caring responsibilities (e.g. Austria, Norway, Portugal, Slovenia and Sweden – in Sweden, for instance, parents can reduce their working hours by up to 25% until the child has reached the age of eight). In others, they are provided to all workers (e.g. in the Netherlands, New Zealand and the United Kingdom). In most cases, employers can refuse requests on business grounds, but in some countries (e.g. Portugal) there are restrictions whereby while children are under a certain age, refusal is only possible if the employees activities are not compatible with telework or if the employer does not have resources for telework arrangements (Chung, 2020[3]; OECD, 2017[1]).

Currently, in Hungary, telework is regulated by Act I of 2012 of the Labour Code, which defines it as an atypical employment relationship. The Act CXIII of 1993 on Labour Safety also applicable in connection with the safe and healthy working conditions. Such acts establish that: teleworking needs to be based on a consensual agreement explicitly referred to in the employment contract; the place of work must be specified in the employment contract; based on agreement concluded with the employer, employees are also entitled to work with own work equipment, and; safety of the work equipment is ensured by means of risk assessment carried out by the employer. Teleworking differs from “home office”, which is not regulated by the Hungarian labour law. Home office does not need to be laid down in an employment contract, but rather is based on a decision by the employer and the employee; the employee maintains a workplace at the employer’s premises; and the work schedule is fixed in principle. Stakeholders stressed the need to improve the regulation of remote work, and raised the issue of different levels of “teleworkability” across jobs (OECD, 2021[7]).

Flexible working arrangements were scarcely used in Hungary before the COVID-19 pandemic. According to the Central Statistical Office, in the first quarter of 2018, 3.7% of all employees (7.9% of white-collar and 0.5% of blue-collar workers) worked in flexible working arrangements. Remote work was also relatively rare. There was no gender gap in this respect except that women were more likely to combine part-time with remote work arrangements (Central Statistical Office, 2018[8]). The share of remote work was highest in Budapest (10%) and lowest in North-Hungary (1.3%). According to surveys conducted by the Institute for Economic and Enterprise Research of the Hungarian Chamber of Commerce and Industry (MKIK GVI) in 2013, 2014 and 2016, 31% of companies in Hungary did not allow any form of flexibility (flexible working time, remote work or home-office, or part-time employment), 31% ensured one option, 26% two options and only 7.5% provided all three options (Tóth J. I., 2019[9]). At the same time, Hungary has made some steps towards promoting the recognition of family-friendly workplace practices (see Box 6.1).

During the pandemic, provisional regulatory adjustments of the general rules established by the Hungarian Labour Code allowed for employer unilateral decisions on teleworking, in order to protect the health of employees and ensure flexible arrangements for parents. Consequently, like in many other countries, the use of telework increased substantially, and set the bases for further potential legislative developments.

From April to June 2020, 16.5% of employees worked from home occasionally or regularly, representing a roughly six-fold increase relative to January-February 2020 (Köllő, 2021[10]). The rise was higher for women: 13.6% of male in contrast to 20.2% of female employees worked from home during the first wave of the pandemic (10.9 and 17.7 percentage points increase from January-February 2020, respectively), which is likely to be explained by the fact that mainly mothers took responsibility for childcare during the lockdowns (Figure 6.1).

Higher levels of education were associated with both higher shares of teleworking in April-June and higher growth rates relative to January-February. For instance, 10.4% of employees with an upper-secondary degree worked from home, in contrast to 49.6% of university graduates. The ratio of employees working from home was the highest in education (50.3%), services (31.5%), and municipal services (15.9%) while agriculture (3.1%), construction (5.5%), and health care (6.8%) had the lowest rates. In general, people with low socio-economic status were much less likely to have the opportunity to work from home, which implies that they faced higher risks of infection and/or job loss (Köllő, 2021[10]).

Anecdotal evidence suggests that telework spread relatively fast in the private sector, while the administrative branches within the public sector responded much slower, possibly due to concerns about personal data protection and/or the prevalence of more traditional management styles.

Considering mothers, home-office seems to have spread fast and continued to be used even in 2021. The share of home-office workers was highest among mothers with children aged below three. In 2021, it was well above the average for all mothers with children aged below eight (calculations by the Budapest Institute for Policy Analysis using data from the Hungarian Labour Force Survey).

The increased telework experience is described as overall positive so far (Nagy, 2021[11]). Employers observed an increase in work performance. For the employees, telework bears benefits (enhanced work-life balance, a lack of commuting, stress-free work environment, more flexible working hours) but also disadvantages (more diffuse boundaries between work and private life, suitability of the work environment, lower interaction with colleagues and managers, and psychosocial risks).

Despite the lack of systematic evidence, negative attitudes of employers are likely to be a key factor behind the low levels of remote work and home office. The stakeholders consulted as part of this study stressed that employers seemed unsupportive of flexible work before COVID-19 (OECD, 2021[7]). This is consistent with findings from a non-representative survey of HR management practices in the domestic corporate sector (the sample included Hungarian firms of various ownership structures and sizes as well as 22 branches of the economy). Survey results show that before the pandemic, 55% of the firms reported not allowing home office for any of their workers, while only 6.5% signalled that more than half of their employees had already worked remotely before (Poór, 2021[12]). During the pandemic, these percentages changed drastically, with 35% of the companies responding that more than half of their workers were working from home at that time. When asked about their future expectations, 47% still said that they did not expect anyone to work from home after the pandemic, but almost 14% foresaw that more than half of their employees would continue to work remotely (Poór, 2021[12]).

Based on survey results, Forgács (2010) found that firms that had no experience with teleworking were worried about work efficiency, data security, increased costs, and the loss of control over their employees. Focus group interviews with HR experts from the private sector, HR consultants and a country-wide network of HR professionals conducted by the Budapest Institute for Policy Analysis in the spring of 2021 corroborated that firms had been very sceptical about the effectiveness of home office before the pandemic. The same focus group interviews suggest that COVID-19 changed these views and also that this may benefit mothers who are looking for ways to return to the labour market.

In the public sector, home office may be further limited by the lack of digital skills and by constraints in how currently available software and hardware support home office (interview conducted by the Budapest Institute for Policy Analysis). Some of these constraints stem from issues of data access while adhering to legal provisions on personal data protection. Local government offices in villages are especially exposed to such challenges due to the complexity of centrally provided software for data management and the lack of available funds to purchase better software or to employ IT staff to maintain a sophisticated data management infrastructure.

From June 2022, the provisions on teleworking have been amended in Hungary within the framework of the ordinary legislative procedure. Key characteristics of the amendment include:

  • Eligibility: only to those employed in the private sector (civil servants’ employment conditions are regulated outside the labour code and are covered by their own statute).

  • Unilateral decisions: not allowed; the parties shall agree on telework in the employment contract.

  • Part-time telework: to be newly introduced.

  • Place of work:

    • Computer-based telework: the administrative burden on the employer is significantly reduced; the place of work may be decided by the employee, taking into account the written information of the employer on the rules of working conditions that do not endanger health and safety; the employer may verify compliance with the occupational safety and health regulations by using a computer device.

    • Teleworking by non-computer means: the parties shall agree in writing on the place of work, which shall be qualified by the employer in advance from the point of view of occupational health and safety. Thereafter, the employee may not change the place of telework.

  • IT equipment: the employer would provide a flat-rate financial support to the employee.

  • Employers could exercise the right of remote control.

  • Occupational health and safety rules of computer-based telework has become more flexible, because of the lower level of risk. However, a risk assessment is still required (even if, by agreement, the employee uses his/her own assets).

Teleworking regulations in OECD countries can be classified according to whether they have an encompassing legal framework and/or an enforceable right to request telework or not. Legal rights to request teleworking, where they exist, can cover all employees (as in New Zealand or Spain) or some categories (as in Lithuania). In countries such as the Netherlands, Portugal and the United Kingdom, employees have an enforceable right to request teleworking, while in some other countries employers can easily refuse to accommodate such requests (OECD, 2021[13]).

The regulations of teleworkers’ working conditions (comprehensively or not, through dedicated legal frameworks or national/sectoral collective agreements, etc.) also vary. This affects access in practice: while the use of teleworking remained limited until the COVID-19 outbreak, it was higher on average in countries where there was an enforceable right to request teleworking, and highest where this right was granted through collective bargaining. Differences in its use might be attributable not only to the regulation in place, but also to other elements such as the proportion of jobs that are “teleworkable”, access to broadband, and management culture (OECD, 2021[13]).

International examples are presented below, with a specific focus on teleworking regulations and practices, namely related to the enforceable right to request flexible working arrangements and telework, as well as other policies supporting these practices.

Some countries provide enforceable rights to request flexible working arrangements. In Portugal, this is available for certain categories of workers. The Netherlands and the United Kingdom provide two examples of a comprehensive “right to request” policy: in both, all employees meeting certain tenure criteria have the right to request flexible working, including the scheduling of hours and the place of work, which employers can refuse only on serious business grounds. Widening the “right to request” to all employees confers bargaining power and reduces the risk of discrimination against specific groups of workers (e.g. parents) (OECD, 2021[4]).

In the Netherlands, according to the Flexible Work Act (Dutch Government, 2016[14]), any employee with at least six months of service from an employer with a minimum of ten employees may request a change in the agreed working hours, working patterns and place of work. The employers must comply with the requests on working hours and working patterns (unless compelling business reasons against them exist), while they have a “duty to consider” a request for changes in the working place. No maximum duration of the work arrangement is mandated, though employers can revoke a teleworking agreement under compelling business reasons. Employers are responsible for health and safety during the telework arrangement. The Act allows for more flexible transitions between full- and part-time employment and to support work-life balance.

The current Law proposal “Working Where You Want” Act aims to convert the right to request a change of the working place as well into a right that can only be refused if the employer has compelling reasons. Grounds for refusal would be safety, working schedules, or issues in finances and organisation.

In the United Kingdom, the right to request flexible working was introduced in 2003 to enhance work-life balance of parents and to achieve gender equality of parents of young children. It was expanded in 2007 and in 2014 (UK Government, 2014[15]) and made available to all workers (excluding agency workers), in order to reduce stigma and negative perception towards those working flexibly. All employees with at least six months’ tenure can request flexible working in different forms, such as job sharing, teleworking, part-time work, compressed hours and flexitime, among others. Applications can only be rejected by employers for legitimate business reasons. Existing health and safety regulations extend to telework. Employers need to provide reasonable equipment and technology that enable employees to work from home.

Despite the fact that the United Kingdom has a right to request telework in place, the increase in the use of telework remained quite limited until the pandemic, when take up increased substantially.

In Portugal, telework was first regulated through a revision of the Labour Law in 2003, which introduced various rights and requirements. These included: a requirement of agreement in writing with explicit mention to telework, the need to reflect willingness from both parties, the need to ensure equality of rights and obligations between teleworkers and other workers, and the right to privacy as a way to ensure the conciliation between work and family life. Employers can refuse regular requests on any ground. However, the possibility for unilateral decision to opt for telework was introduced later for specific categories or workers: victims of domestic violence (2009) and parents of children until three years of age (2015), for whom refusal is only possible if the employees’ activities are not compatible with telework or if the employer does not have resources for teleworking arrangements. Employees have similar rights and duties as other employees concerning occupational health and safety and the employers bear all costs related to working equipment.

The COVID-19 pandemic implied important changes, and the adoption of telework became obligatory in all “teleworkable” cases. Its use strongly increased during the pandemic, but not homogenously: major differences existed between genders (40% of women versus 32% of men at work were teleworking), economic sectors, occupations and company sizes (the larger the company, the higher use of telework). Telework has become a new “tool” for the reconciliation of family and professional life, but with challenges related to privacy and working time (OECD, 2021[4]).

Also in countries that do not necessarily have enforceable rights to request in place, various interventions are supportive of telework practices.

Italy has an enforceable right to request occasional teleworking. Agile working (or smart working) is a modality of execution of the subordinate employment relationship characterised by the absence of time or spatial constraints and an organisation by phases, cycles and objectives, established by agreement between employee and employer. It helps the worker to reconcile the times of life and work and, at the same time, boosts productivity. The definition of smart working contained in the Italian Law 81/2017 emphasises organisational flexibility, the voluntary nature of the parties who sign the individual agreement and the use of tools that allow working remotely. Agile workers are guaranteed equal economic and regulatory treatment with respect to their colleagues who perform the service in ordinary ways. Their protection in the event of accidents and occupational diseases is also envisaged (Italian Ministry of Education, 2017[16]). Since the COVID-19 outbreak, various measures have further simplified the rules of smart working, especially in the public administration (Polytechnic University of Milan, 2021[17]).

Some countries have aimed to encourage the development of telework practices by introducing dedicated financial incentives for employers. In Poland, a 2014 amendment to the Act on Employment Promotion and Labour Market Institutions introduced grants for employers creating teleworking jobs for unemployed parents of a child under six years old, or for an unemployed carer who resigned from their previous jobs to take care of their child or dependant (OECD, 2021[13]).These measures have been assessed as well targeted to parents with the goal of increasing labour supply; however, uptake this measure has been limited (Vandeninden and Goraus-Tanska, 2017[18]), stressing the need for complementary supports.

The international practices presented above and discussed in the workshop provide bases for reflection ad takeaways of relevance for the Hungarian context (OECD, 2021[4]):

  • Teleworking has important pros and cons for gender equality in the labour market and work-life balance:

    • Teleworking is a key form of flexible work, which has proved fundamental during the COVID-19 pandemic and effective in enhancing work-life balance.

    • Nonetheless, teleworking also bears risk for gender equality, for instance in terms of a higher childcare burden for teleworking parents, but also a negative stigma related to the idea that workers who use flexible working for care purposes are not as productive or committed (Chung, 2020[3]). In this sense, risks become higher if the use and behaviours in teleworking is gender-specific.

    • In order to avoid negative consequences, teleworking legislation needs to be accompanied with complementary policy actions that support a change in societal norms on caring responsibilities, encourage men to take up flexible working for care purposes, and ensure a positive change in the organisational culture (OECD, 2021[4]).

  • Frameworks that support flexible working arrangements include telework as one of their pillars:

    • Guaranteeing teleworkers with equal economic and regulatory treatment with respect to their colleagues who perform the service in ordinary ways is fundamental to avoid discrimination and labour market segregation.

    • Moreover, access to telework for “teleworkable” jobs may need to be supported by complementary interventions, such as targeted investments in technology and in training (OECD, 2021[13]).

  • Teleworking regulations encompass several aspects, including rights to request:

    • The consensus is that teleworking should be based on mutual agreement between the employee and the employer.

    • The right for the employee to request telework is increasingly seen as a right that the employer should be allowed to refuse only with compelling reasons, and it reflects policy makers’ attempt to avoid discrimination.

    • Further policy reflections relate to the possibility to provide specific groups with a unilateral right to enforce teleworking (e.g. mothers of young children), if this is feasible in the business context.

    • In order to implement a teleworking arrangement, both the employer and the employee shall agree on teleworking arrangements in written form in the employment contract, including also part-time teleworking arrangements. Reflections on the duration of the arrangement and grounds for interruption of such agreement are also needed.

    • As long as the workplace complies with occupational safety regulations, employees shall be able to freely choose their place of work. It is the employer’s responsibility to inform the employee in writing about such regulations.

    • Important policy reflections relate to the need to comply with occupational health and safety standards and to the question of who remains responsible in the case of occupational accidents.

References

[2] Bond, J. and Galinsky E. (2011), Workplace flexibility and low-wage emplyees, Families and Work Institute, New York.

[8] Central Statistical Office (2018), A 15–74 éves távmunkában dolgozó, valamint távmunkában nem dolgozó alkalmazottak munkaerőpiaci jellemzői nemek szerint, 2018. I. negyedév, Table 9.10.2. (Labour market characteristics of remote and non-remote employees).

[3] Chung, H. (2020), “Company-Level Family Policies: Who Has Access to It and What Are Some of Its Outcomes?”, in The Palgrave Handbook of Family Policy, Springer International Publishing, Cham, https://doi.org/10.1007/978-3-030-54618-2_21.

[14] Dutch Government (2016), Flexible Work Act, https://wetten.overheid.nl/BWBR0011173/2016-01-01.

[9] Fazekas K., S. (ed.) (2019), Flexible work arrangements and other family-friendly measures among Hungarian companies, Centre for Economic and Regional Studies, Hungarian Academy of Sciences, Budapest.

[16] Italian Ministry of Education (2017), Agile Work, https://miur.gov.it/lavoro-agile.

[10] Köllő, J. (2021), “Employment during the first wave of Covid-19”, in Centre for Economic and Regional Studies, I. (ed.), The Hungarian Labour Market 2020, Fazekas et al (eds).

[11] Nagy, K. (2021), “Telework” in Hungary, OECD, Paris, https://www.oecd.org/gender/Telework_HU_KNagy.pdf.

[13] OECD (2021), OECD Employment Outlook 2021: Navigating the COVID-19 Crisis and Recovery, OECD Publishing, Paris, https://doi.org/10.1787/5a700c4b-en.

[4] OECD (2021), Technical Support to Reduce the Gender Employment Gap in the Hungarian Labour Market - Report on the international workshop.

[7] OECD (2021), Technical Support to Reduce the Gender Employment Gap in the Hungarian Labour Market - Summary report on stakeholders’ views and beliefs, OECD, Paris, https://www.oecd.org/gender/Summary-report-on-stakeholders-views-ENG.pdf.

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[6] OECD (2016), Be Flexible! Background brief on how workplace flexibility can help European employees to balance work and family, OECD, Paris, http://www.oecd.org/els/family/Be-Flexible-Backgrounder-Workplace-Flexibility.pdf.

[17] Polytechnic University of Milan (2021), Smart working - Agile work from theory to practice (Smart working - Lavoro agile dalla teoria alla pratica), https://blog.osservatori.net/it_it/smart-working-cos-e-come-funziona-in-italia.

[12] Poór, J. (2021), Koronavírus-válság kihívások és HR válaszok – első-második-harmadik hullám összehasonlítása.

[15] UK Government (2014), The Flexible Working Regulations 2014, https://www.legislation.gov.uk/uksi/2014/1398/made.

[18] Vandeninden, F. and K. Goraus-Tanska (2017), PORTRAITS OF LABOR MARKET EXCLUSION 2.0 - Country Policy Paper (CPP) for Poland, https://orbi.uliege.be/bitstream/2268/249872/1/Final-Poland-CPP-forPublication.pdfz.

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