Hungary
Constitutional Court ruling on medical incapacity
Impact date: 27 February 2025 (date of the Constitutional Court’s decision; immediate effect upon publication) On 27 February 2025, the Hungarian Constitutional Court issued Decision No. 1/2025, declaring that the second clause of Section 55 (1) (a) and the final clause of the second sentence of Section 146 (2) of Act I of 2012 on the Labour Code, relating to employment in cases of incapacity due to health reasons, are incompatible with the Constitution and therefore annulled.
According to the ruling, employers are obligated either to offer the employee a different position that is suitable given their medical condition or to terminate the employment relationship. If neither action is taken, the employee is entitled to remuneration for the period of inactivity due to medical incapacity.
Employer implications/action needed Employers should review internal policies and practices to ensure that employees deemed medically unfit for their roles are either: offered alternative, suitable positions; or lawfully dismissed. Avoid unpaid retention for the period of inactivity.
Employer risk Failure to act may result in liability for back pay (standby remuneration) under Section 147 of the Labor Code and may further expose the employer to potential legal claims for unlawful treatment or breach of constitutional rights.
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