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Protection of Wages Convention, 1949 (No. 95) - Hungary (RATIFICATION: 1956)

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Article 4(2) of the Convention. Partial payment of wages in kind. The Committee recalls its previous comment in which it requested the Government to specify how it is ensured that allowances in kind are attributed a fair and reasonable value, as prescribed by this Article of the Convention. In its latest report, the Government indicates that the partial payment of wages in the form of allowances in kind occurs extremely rarely and that, in any event, the labour inspection services may control whether benefits in kind correspond to the needs of employees and their families and whether their value exceeds 20 per cent of the agreed cash wages. In this regard, the Committee wishes to recall paragraph 159 of its 2003 General Survey on the protection of wages in which it pointed out that setting an overall limit on the proportion of the money wages which may be replaced by benefits in kind does not in itself resolve the problem of the fair valuation of such benefits and offers little protection to workers from possible exploitative practices. Such limits alone cannot guarantee that allowances are not overvalued to the detriment of real earnings of workers. The Committee wishes also to refer to paragraphs 154–158 of the same General Survey which highlight possible ways for ensuring conformity with the requirements of the Convention (e.g. allowances to be valued at cost prices, or allowances not to exceed ordinary market value, the value of certain goods or services to be fixed by law, etc.). The Committee notes, however, that the new Labour Code, which was adopted on 13 December 2011, in particular sections 154–164 referring to protection of wages, does not appear to contain any provision expressly authorizing, or prohibiting, the partial payment of wages in kind. The Committee accordingly requests the Government to provide additional explanations in this respect.

Article 8. Deductions from wages. The Committee recalls its previous comment in which it drew the Government‘s attention to the fact that the Convention recognizes only national laws or regulations, collective agreements and arbitration awards as legal bases for lawful deductions, it being understood that deductions made on any other basis, such as deductions by virtue of individual agreement or merely with the consent of the worker, are not in conformity with the requirements of the Convention. In its latest report, the Government states that a revision of the provision of the Labour Code according to which employees may authorize wage deductions is pending. Noting that section 161(2) of the new Labour Code authorizes employers to proceed to deductions from wages based on the employee’s consent, the Committee requests the Government to keep the Office informed of any progress made in this respect and to transmit a copy of the revised text once it is adopted.