Hungary: Impacts of COVID-19 on the labour and real estate markets | Podcast

04 August 2020 | hungary newsletters

The COVID pandemic and the subsequent state of emergency in Hungary have disrupted conventional methods of working, with most companies having successfully transitioned into home office – a modus operandi rarely used before. In parallel, partially going back to to normal poses challenges in terms of providing safe working conditions which comply with data protection and cybersecurity requirements. Dániel Gera, employment lawyer and counsel provides useful insights on this (in Hungarian).

During the talk, László Krüpl, head of the real estate practice in Budapest summarises how Hungarian offices have been affected by the pandemic: whether an increasing ratio of empty office space can be expected or what legal options lessees have during negotiations with lessors.

Find a summary of the podcast below – or listen to the podcast (in Hungarian):

Summary of the podcast:

Legal challenges of transitioning to home office and returning to office

How do we maintain a successful home office set-up now that home office is ubiquitous? What occupational safety requirements must be met by employers on returning to the office? These topics and more are discussed in Schoenherr Hungary's podcast (in Hungarian) led by two of our legal experts Dániel Gera, counsel and László Krüpl, head of real estate.

The COVID pandemic and the state of emergency have changed the circumstances for working from home in most European countries, including Hungary. It seems that most companies have taken challenges posed by these working circumstances and successfully overcome them, transitioning into smooth-running home office arrangements. This set up has worked so well, in fact, that many if not most companies still plan to maintain it in some form. At the same time, returning to the traditional office environment imposes tasks on employers for stringent occupational safety measures to be met, with unavoidable changes to some measures, and the introduction of further rules. What are the legal challenges of transitioning to home office and returning to office? Dániel Gera, Head of Labour and Employment at Schoenherr Hungary emphasises that home office is neither remote work, nor does it qualify as a posting as per traditional definitions of labour law, which is an obligatory element of the labour system in Hungarian law. Thus, precise provisions for what constitutes the work place in case of home office requires definition – drafting. Practical questions arise. Who pays for the increased consumption of energy or other conditions for work in the case of home office? What are the obligations of the employer? The third factor to be considered is ensuring data security standards are legally upheld during home office.

In the real estate market section of the podcast, László Krüpl, head of real estate at Schoenherr Hungary, summarises the office market and how it has been affected by the pandemic. The sector (pre-Covid 19) was flourishing, with new players entering the market and with a fairly low ratio of empty office spaces. The pandemic has seen a downturn in the industry. No extreme changes are expected, however. Since quite a large area of office space has remained empty during the lockdown in Hungary, lessees are looking for options to mitigate their losses. Lessors, however, may claim that lessees did not share the profit in good times. Why should they share the risks in bad times? The legal options offered to lessees, are being formulated in the upcoming months. Since home office will remain in force to some extent, larger office spaces are needed for appropriate social distancing, the empty office space ratio will not decrease.

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