Hungary: Latest developments in working life Q4 2019

New legislation on social insurance and a fresh study prepared by a trade union on the automotive industry in south Hungary are the main topics of interest in this article. This country update reports on the latest developments in working life in Hungary in the fourth quarter of 2019.

Controversial new social insurance law

The Hungarian Trade Union Confederation (Maszsz) spoke out against a new Social Security Act that will make drastic changes to the way healthcare services are administered in Hungary. ^[1]

The new law, signed by President János Áder on 18 December, states that only people whose social contributions are paid regularly and who show up as insured in the healthcare registration system are eligible to be treated by doctors and healthcare providers. ^[2] The rule will be applied strictly as of July 2020. From that time, a red light will flash on a healthcare provider’s computer screen to indicate when a patient does not have insurance coverage, and the patient will be denied treatment.

According to the law's opponents, including Maszsz and the Hungarian Medical Chamber (MOK), the administrative system could penalise employees even when it is their employers who fail to pay the contributions. Under the new law, and through no fault of their own, employees could be left without medical care or essential medication, unless they agree to pay the full price in cash. Treatment can be denied after three months of unpaid (or not received) contributions worth about HUF 27,000 (€80 as at 5 March 2020). Maszsz members also report that challenging a situation where the employer has failed to pay the employee's insurance can be time consuming, while medical attention may be required immediately.

The government has argued that the law is designed to curb abuses by people who (including many Hungarians permanently living abroad) take advantage of medical services in Hungary without paying full insurance and taxes.

The leader of MOK stated that they were opposed to the law as it could put doctors in a situation where they may have to deny treatment to people and that it adds extra administrative burdens to an already exhausted healthcare system.

• National Assembly of Hungary: 2019. évi CXXII. törvény a társadalombiztosítás ellátásaira jogosultakról, valamint ezen ellátások fedezetéről

Union report sheds light on auto industry work conditions

While Hungary's automotive industry is often cited as a success story at home and abroad, a recent study prepared by the Hungarian Metalworkers’ Federation (VASAS) presents the flip side of the coin. Entitled ’Kecskemét in focus: Working conditions in the car industry in the South Great Plains (Alföld) region’, the report describes how high work intensity, poor conditions and too much overtime make the sector a bad place for workers, despite relatively high wages. ^[3]

The study was based on interviews with 40 workers and trade union officials in the car industry in the region, and it revealed many issues, such as work safety. Workers especially complained of working excessive overtime or without sufficient breaks. Another problem cited by the study was that rising housing prices in the region are forcing workers to commute longer distances, which is another factor impinging on rest time (commute time is usually not counted towards working time). These problems tend to affect women more than men due to their caring responsibilities at home, the study shows. VASAS suggests taking more steps to protect workers' rights, including making stronger alliances with sector-related trade unions at the European level.

Commentary

The Hungarian government tends to pass new legislation towards the end of the year. The timing, and the fact that social partners are often given limited time to review legislative drafts, often leaves them feeling that their voices are ignored.

Healthcare administration is one of the most complex areas any government must deal with, and the unions feel that the recent law, which may affect as many as 700,000 people, was rushed through without consultation. Opposition politicians and trade unions also feel it is unfair to deny people medical treatment over debts as little as about HUF 27,000 (€80), which is disproportionate to the law’s benefits. However, with several other controversial laws (on public education, theatre financing) triggering protests in November and December 2019, many Hungarians are left without the energy to take issue with all the changes happening at the end of the year.

A report from a sub-section of the car industry shows the effects of the 'overtime law' passed in 2018 with some negative consequences for workers in this very competitive segment of industry. If conditions continue to worsen, the labour shortage may become a more acute problem in this sector, given that relatively higher wages fail to compensate for the poor conditions. Trade unions are hoping they may have influence – given Hungary’s often cited reliance on this industry for growth – but there are obstacles to smooth unionising and lobbying techniques which they hope to overcome by making alliances Europe-wide, especially with German unions in the sector.