If you employ people in Hungary — or are about to onboard your first Budapest hire — annual leave is one of the first compliance topics that will trip up an HR template designed for the UK or US. Hungary’s Labour Code (Munka Törvénykönyve, Act I of 2012) does something most other European regimes do not: it scales the statutory minimum upward by the employee’s age, in nine separate steps, rather than treating leave as a single flat entitlement.

This guide explains what the Munka Törvénykönyve actually requires in 2026 — the 20-day base, the age-based ladder up to 30 days, eligibility and pro-rata in the first year, holiday pay, employer duties, and the pitfalls that catch international employers most often. Every fact below comes from Sections 115–134 of the Labour Code itself.

Key Takeaways

Statutory annual leave (szabadság) starts at 20 working days and increases with age in nine steps to 30 days at age 47 and above.
The age-based increase takes effect from the employee’s birthday in the relevant calendar year, not at the start of the year.
First-year leave is pro-rated based on months worked. Full statutory entitlement applies once the employee is in continuous service.
Holiday pay is the employee’s base salary — regular allowances and supplements are not included in the calculation.
Parents with children under 16 and certain professions (such as education and health) may receive additional leave on top of the age-based entitlement.
Untaken leave on termination must be paid out in cash. It cannot be waived in the contract.

The Statutory Entitlement Under the Munka Törvénykönyve

Sections 115–134 of the Labour Code set the floor for paid annual leave in Hungary. Every employee in an employment relationship is entitled to at least 20 working days of paid leave per calendar year, called szabadság.

The 20-day figure is only the starting point. The Labour Code adds a fixed number of extra days on top of that base as the employee gets older, producing a clear age-based ladder. The full statutory schedule is:

Under 25: 20 working days
From age 25: 21 working days
From age 28: 22 working days
From age 31: 23 working days
From age 33: 24 working days
From age 35: 25 working days
From age 37: 26 working days
From age 39: 27 working days
From age 41: 28 working days
From age 43: 29 working days
From age 45: 30 working days

Note on the schedule: the Munka Törvénykönyve increases the entitlement by one extra day at progressively earlier-clustered ages until it caps at 30 days. The headline rule is simple — 20 days base, plus extra age-based days, capped at 30 days for older workers. Employers must check each employee’s age individually rather than relying on a single tenure number.

Why the Age Ladder Matters

For employers used to a single statutory minimum, the age ladder is the single most important thing to internalise. The entitlement is not based on length of service with your company, nor on length of service in Hungary — it is based on the employee’s chronological age. A new hire in their forties is on a higher tier from day one than a new hire in their twenties, even with identical contracts.

This also means the entitlement steps up automatically as employees age through the brackets. Your HRIS or leave system needs to recalculate each employee’s allowance every year, not just at hire date.

When the Age-Based Increase Takes Effect

The increase takes effect from the employee’s birthday in the relevant calendar year, not from 1 January. An employee who turns 31 on 14 May 2026, for example, moves from the 22-day tier to the 23-day tier on that date.

In practice, most Hungarian employers handle this by granting the higher figure for the full calendar year in which the birthday falls. Whichever approach you use, make sure your leave records show the correct underlying calculation so the State Labour Inspectorate can audit it.

Eligibility: All Employees, Pro-Rata in the First Year

Annual leave under the Munka Törvénykönyve is open to all employees in an employment relationship, not just full-time permanent staff. The Labour Code does, however, distinguish how the entitlement is calculated in the first year of employment.

First Year of Employment

In the first calendar year of employment with a given employer, leave is pro-rated based on the months worked. An employee who joins in June, for example, accrues leave proportional to the months remaining in the year, not the full annual entitlement.

The same pro-rata logic applies in reverse for mid-year leavers. An employee whose employment ends part-way through a calendar year is entitled to the proportional fraction of that year’s leave they had accrued, with any untaken balance paid out as part of the final settlement.

From the Following Year

From the calendar year after the employee starts, the full annual entitlement for the employee’s age tier is granted at the start of the year. They do not have to accrue it month by month — it is available to schedule from January, subject to the normal scheduling and approval process.

Worked Example: Mid-Year Joiner

Bence joins a Budapest office on 1 July 2026 at age 30. He turns 31 on 12 October 2026.

First-year entitlement: pro-rated for six months of service (July to December). His base tier at hire is 22 days, increasing to 23 days from 12 October when he turns 31.
Practical handling: most employers simply grant the higher figure for the full first year and pro-rate from there — so Bence accrues roughly half of 23 days, around 12 days, for the remainder of 2026.
From 1 January 2027: Bence is entitled to the full 23 days at the start of the year, stepping up again to 24 days when he turns 33.

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Employer Obligations Under the Labour Code

The Munka Törvénykönyve places several non-negotiable duties on the employer. Treat the following as a compliance checklist.

1. Grant the Correct Age-Based Entitlement

You must grant 20 to 30 days based on the employee’s age in the calendar year. Contracts that purport to offer less are void to the extent of the shortfall, and treating every employee as a 20-day employee is a clear breach for anyone past 24.

2. Pay Base Salary During Annual Leave

Holiday pay during szabadság is calculated on the employee’s base salary. Regular allowances, supplements, and variable pay components are not included in the holiday pay figure under the basic Labour Code rule — this is materially different from countries such as the Czech Republic, where average earnings on the previous quarter form the base.

The principle is that the employee continues to receive their core salary during leave. If you operate a heavily variable pay structure in Hungary, work with local payroll counsel to confirm exactly which components are in scope for your specific arrangements.

3. Allow Leave to Be Taken Within the Calendar Year

The Labour Code requires the employer to enable the employee to take their annual leave during the calendar year in which it accrues. Employers cannot use scheduling power to indefinitely postpone leave or to push employees toward building up balances that are paid out only on termination.

4. Pay Out Untaken Leave on Termination

When employment ends, any accrued but untaken annual leave must be paid out in cash as part of the final settlement. This is a statutory right and cannot be waived in the employment contract.

5. Do Not Require Forfeiture or Mid-Employment Cash-Out

Annual leave is a non-waivable right while the employment relationship is ongoing. You cannot ask employees to sign away their entitlement, swap it for cash during employment, or accept reduced leave in exchange for other benefits. Cash equivalent is only available on termination.

Additional Leave Entitlements

The age-based 20–30 day ladder is the statutory baseline. Hungarian employment law layers additional entitlements on top in two main scenarios.

Parents With Children Under 16

Parents with children under the age of 16 are entitled to additional leave on top of the age-based entitlement. The number of additional days depends on how many children fall within the eligible age range. This is an important point to flag in any onboarding form for Hungarian employees, because the entitlement is granted by law — it does not require the employee to negotiate it into the contract.

Certain Professions

Certain professions have enhanced entitlements under sector-specific rules. Education and health roles are the most commonly cited, with additional leave granted under the relevant ministerial regulations. If you are unsure whether a particular role qualifies, the safest path is to check the role against the relevant ministerial regulation rather than relying on a generic contractual default.

Common Pitfalls for International Employers

If your team has only worked under UK, German, or US leave regimes before, the Hungarian framework will catch you off guard in predictable ways. Watch for these.

Pitfall 1: Treating Annual Leave as a Flat 20 Days

The single most common error is configuring an HRIS to grant a flat 20 days for every Hungarian employee. The Munka Törvénykönyve scales upward by age. An employee in their forties will be systematically under-granted leave under this setup, and the shortfall is recoverable.

Pitfall 2: Not Tracking Birthdays for the Age Step-Up

The age-based increase takes effect from the employee’s birthday. If your system only recalculates entitlements once a year on 1 January, you will under-grant leave to anyone who crosses an age threshold mid-year. Your HRIS needs to recompute the entitlement on each employee’s birthday and adjust the running balance.

Pitfall 3: Including Allowances in Holiday Pay

Hungary’s basic Labour Code rule is base salary only during szabadság. Importing a UK or Czech “average earnings” model and including bonuses, shift premia, or commission in the holiday pay calculation will overpay employees and create reconciliation issues. Confirm the precise composition of holiday pay with local payroll counsel before configuring.

Pitfall 4: Missing the Parental Top-Up

Parents with children under 16 receive additional leave by statute. Forgetting to add this entitlement on top of the age-based base is a clear breach, and it tends to be missed when employers transplant a generic European policy template into Hungary.

Pitfall 5: Asking Employees to Cash Out Leave Mid-Employment

Annual leave cannot be cashed out while the employment relationship is ongoing. The cash equivalent (payment in lieu of untaken leave) is available only on termination, when any accrued but untaken balance must be settled.

Frequently Asked Questions

How many days of annual leave am I entitled to in Hungary?

Annual leave starts at 20 working days for employees under 25 and increases with age in nine steps to 30 days at age 47 and above. The exact figure for any year depends on the employee’s age in that calendar year under Sections 115–134 of the Munka Törvénykönyve.

When does the age-based increase take effect?

The increase takes effect from the employee’s birthday in the relevant calendar year, not from 1 January. Most employers grant the higher figure for the full calendar year in which the birthday falls; whichever approach you use, your underlying records should reflect the statutory rule.

Are there additional leave entitlements beyond the age-based base?

Yes. Parents with children under 16 receive additional leave on top of the age-based entitlement, and certain professions such as education and health may have enhanced entitlements under sector-specific regulations.

Is holiday pay in Hungary based on average earnings?

No. Holiday pay during szabadság is calculated on the employee’s base salary. Regular allowances and supplements are not included in the basic Labour Code calculation — this differs materially from countries such as Czechia, where holiday pay reflects average earnings on the previous quarter.

What happens to unused leave when employment ends in Hungary?

Untaken accrued leave must be paid out in cash as part of the final settlement on termination. This is a statutory right under the Munka Törvénykönyve and cannot be waived in the employment contract.

Are part-time employees entitled to annual leave in Hungary?

Yes. All employees in an employment relationship are entitled to annual leave under the Labour Code. First-year leave is pro-rated based on months worked, and entitlements for part-timers are calculated proportionally to working time within the same age-based framework.

Practical Compliance Checklist

If you operate in Hungary, your leave management system needs to handle the following at minimum:

Apply the age-based entitlement (20 to 30 days) per employee, recomputed each year.
Step entitlements up automatically on the employee’s birthday when they cross an age threshold.
Pro-rate first-year entitlement by months worked, then switch to the full age-based entitlement from the second calendar year.
Layer additional days for parents with children under 16, and any sector-specific enhancements.
Calculate holiday pay on base salary under the basic Labour Code rule.
Ensure leave is taken within the calendar year and document any reasons it could not be.
Pay out any accrued but untaken balance on termination.

How Leave Balance Helps Hungarian Employers Stay Compliant

Managing the Munka Törvénykönyve correctly across a Hungarian workforce — alongside UK, AU, EU, or US teams — is the kind of compliance work that quietly breaks generic spreadsheets. Age-based entitlements, mid-year birthday step-ups, and parental top-ups rarely fit out of the box in a global HRIS.

Leave Balance gives you:

Country-specific entitlement rules for Hungary, including the full 20–30 day age-based ladder.
Date-of-birth tracking that automatically increases entitlement when an employee crosses an age threshold.
First-year pro-rata accrual with a clean switch to the full annual entitlement from the following calendar year.
Configurable additional leave for parents with children under 16 and sector-specific top-ups.
Multi-country support with separate policies per entity, all on a single dashboard.

For a comparison with neighbouring regimes, see our guides to Annual Leave Entitlement in Czechia, Annual Leave Entitlement in Poland, and Annual Leave Entitlement in Germany for a side-by-side EU picture.

At $10 per month for unlimited employees and unlimited policies, Leave Balance gives you the country-specific rule engine you need without the cost of an enterprise HRIS. Start your 14-day free trial — no credit card required.