Abstract

The issue related to labour regulation of small and medium-sized enterprises is a very limited but important field of labour law in a broader sense, as the SME sector plays a crucial role in the macro-economy and employment due to the large number of small and medium-sized enterprises in virtually all countries. The contribution of small and medium-sized enterprises to employment is the most significant amongst enterprises of all sizes, and the SME sector creates more jobs than large companies. After recognising the important role of small enterprises amid the growth in the SME sector, the sector has formed part of EU employment policy and economic policy for about 20 years. Thereafter, the European Union has provided a significant number of indications that it takes or endeavours to take the needs of small undertakings into account when setting different economic policy and employment policy purposes and drawing up strategies in this respect. Alongside this process, the Hungarian employment policy and economic policy have begun supporting small enterprises and taking their needs into account. The concept of supporting the development of the SME sector in terms of labour legislation emerged before the adoption of the Hungarian Labour Code currently in force, when it was mentioned several times in the preparation of the Labour Code that the majority of employers belong to the SME sector, and the employment needs and capabilities of these employers are different to those of larger firms. In that context, differentiated labour regulation has also been suggested, according to which labour rules that are less burdensome for small employers should be created, i.e. their economic strength, employment needs and capabilities should be taken into account. These ideas were essentially ‘torpedoed’ by Constitutional Court Decision 41/2009 (III. 27.), however, in my opinion, the debate on this matter is still not cut-and-dried, as many counter-arguments on labour regulation of small enterprises have emerged since then; a critical analysis of these arguments is provided in the dissertation. The source of the problem is the fact that if the same rules apply to small enterprises and large, well-capitalised multinational enterprises with thousands of employees, legislation fails to take the employment needs and capabilities of small enterprises into account. Nevertheless, if small enterprises are exempted from certain labour law obligations, employees employed by these enterprises could be worse off than those employed by larger enterprises. However, the latter option may infringe the most basic and fundamental employee rights of the employees of small enterprises and, in particular, the principle of equal treatment, and would thus imply a deterioration of their situation compared to that of other persons in the labour market. Moreover, it is an empirically proven fact that the employees of small enterprises generally have to endure worse working conditions — i.e. they work longer hours for lower wages, while rules guaranteeing health and safety at work are not respected in their workplace — than the employees of large enterprises. Supporting small enterprises by exempting them from labour rules or at least some of those may entail for employees a number of disadvantages to be discussed in depth in the dissertation. If we do so in the light of the fact that one of the key objectives of the European Union is to raise employment in the SME sector, those suggestions should also be taken seriously, as amendments to that effect will affect the situation of millions of employees. Of course, the situation is more diverse, and the ‘challenges’ for the SME sector have many aspects; in this respect, the dissertation endeavours to provide a critical and complete analysis of the issue of labour law. Despite the fact that the dissertation solely aims to examine labour law issues, it also covers and examines, as far as necessary, other, in particular employment policy issues. Exempting small enterprises from the application of labour and labour-related laws or failure to enforce these rules in practice appear to have a little positive impact on economy, while it has a significant negative impact on the employees’ legal position, working conditions, and social security. I am convinced that the correct application of labour law does not hamper economic growth and development, instead innovative regulatory solutions can play an important role in streamlining a satisfactory regulatory environment, in such a way as to secure decent work and, at the same time, help develop small enterprises and promote their formalisation...

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