Chinese electric‑vehicle giant BYD has positioned itself as a central player in the European Union’s green transition, with its roughly $6 billion factory in Szeged, Hungary, designed to produce around 300,000 electric vehicles per year for the European market. The project is consistently framed as a symbol of clean‑energy industrialisation that will help Europe meet its climate‑targets while creating about 4,000 jobs in a less‑developed region of the country.
Yet at the same time, independent investigations and media reports suggest that the human‑cost of this “green” factory may be far heavier than official narratives admit. Labour‑rights advocates argue that
“workers were not allowed time off even on Sundays”
and that “overtime was not paid”, casting a shadow over the plant’s environmental credentials. For a company that markets itself as a global leader in sustainable transport, the alleged BYD Hungary forced labour practices create a sharp dissonance between image and on‑the‑ground reality.
Migrant workers and the hidden labour force
Many of the roles that actually built the plant were not filled by local Hungarian workers but by Chinese migrant workers brought over on short‑term business visas rather than formal work‑permit arrangements. These workers were reportedly housed in large on‑site dormitories accommodating about 450 residents each, keeping them physically isolated from local communities and labour‑market structures.
This arrangement effectively placed the workforce at the margins of Hungary’s labour‑law protections, limiting their access to independent trade‑union support and straightforward grievance mechanisms. The investigations suggest that
“workers’ lack of proper work permits meant they were more vulnerable to exploitation and less able to seek legal redress”,
which helped create conditions where abuses could persist without effective oversight. In an analysis of transnational labour flows, this pattern raises concerns about how large‑scale green‑energy projects can quietly off‑shore labour‑cost advantages to vulnerable groups.
Working conditions and overtime violations
The most serious allegations centre on the sheer intensity and duration of work required from these Chinese construction workers. Investigators from labour‑rights groups report that workers routinely performed 9–10 hours of work per day, rising to 12–14 hours a day during peak construction periods. Even more troubling, many were expected to work seven days a week, with some individuals reportedly working 30–31 consecutive days without rest.
Under Hungarian labour law, employees are entitled to weekly rest days and must be paid overtime at a higher rate for extra hours. The analysis of the BYD Hungary forced labour case suggests that these rules were systematically ignored. The investigators underline that “overtime was not paid”, turning legally protected time‑off entitlements into de facto workdays and effectively treating the workers as a self‑contained labour brigade rather than as rights‑bearing employees.
Wages, withheld pay, and forced‑labour indicators
Wage‑related practices are central to the argument that the situation contains “clear indicators of forced labour”. Reports indicate that workers were paid far below Hungary’s minimum wage, often receiving only a fraction of what local workers would earn, while 20–30% of their wages were allegedly withheld and deposited into bank accounts in China, to be released only if the workers completed the full contract term.
This mechanism created a powerful form of financial coercion: workers were informed that if they left before the plant’s construction schedule was finished, they would lose the withheld portion of their wages and also have to pay for their own airfare and visa‑related costs. In its analysis of the case, civil‑society research notes that
“workers were told they would return to China after about six months, but BYD pushed back the dates”,
effectively extending their stay without adequate compensation. Such dynamics are exactly the kind of situations that United Nations and international labour‑standards frameworks are designed to flag as debt‑bonded or coercive labour.
Visa practices and legal vulnerability
The way workers were brought into Hungary adds another layer to the analysis of the BYD Hungary forced labour case. They reportedly entered on short‑term business visas, not proper work visas, which limited their access to many labour‑law protections and social‑security entitlements. That meant that, beyond being underpaid and overworked, many workers also lacked clear routes to adequate medical care or formal channels for lodging grievances.
Human‑rights researchers argue that this visa‑status strategy effectively sidesteps regulatory safeguards, creating a grey zone where employers can rely on migration‑status concerns to deter complaints. The fear of being deported or losing one’s only source of income can act as a powerful deterrent to speaking out, especially when the project is framed as a high‑stakes national‑development priority. In this context, the workers’ precarious status becomes a structural feature that can too easily be exploited, reinforcing the forced‑labour indicators identified in the analysis.
Official response and enforcement gaps
Formal scrutiny has begun only after media and advocacy groups made the case highly visible. Labour‑rights organisations have submitted their findings to Hungary’s Commission for Fundamental Rights, as well as to the European Commission, the European Parliament, and other EU‑level bodies, explicitly calling for an investigation and remedies. The analysis of the BYD Hungary forced labour case suggests that regulatory‑enforcement mechanisms have lagged behind the speed of investment, leaving major industrial projects vulnerable to systematic labour‑rights violations.
At the same time, the absence of a clear, detailed public response from BYD on the specific migratory‑worker allegations allows critics to argue that the company is not fully engaging with its human‑rights due‑diligence obligations under international frameworks, including those referenced by the United Nations. The analysis of the plant’s practices and the policy environment suggests that the case should be treated not just as an isolated incident, but as a test‑case for how EU‑level forced‑labour rules are applied in practice.
Broader implications for the EU green transition
Beyond the individual plant, the BYD Hungary forced labour case carries wider implications for the EU’s green‑transition strategy. As the bloc aggressively pursues decarbonisation, it increasingly depends on large‑scale foreign‑direct‑investment projects, often framed as “win‑win” for climate goals and local economies. However, this case shows that the supply‑chain and labour‑law dimensions of such projects can lag far behind the environmental narrative, risking reputational and legal blowback.
The analysis of the situation suggests that
“the EU cannot credibly ban forced labour in its markets while turning a blind eye to cases like this in its own backyard”.
To uphold the credibility of its forced‑labour bans and corporate‑due‑diligence legislation, the EU must investigate and act on credible evidence of abuse, even when it involves high‑profile green‑energy investments. This means linking incentives such as state aid and green‑subsidy eligibility to demonstrable compliance with labour‑rights standards, treating environmental benefits as complementary to, not a substitute for, decent work.
From a United Nations‑aligned perspective, the case underscores the need for stronger international cooperation on transnational labour‑protection standards, particularly in the EV and clean‑energy sectors, where the drive for rapid industrialisation can easily eclipse worker‑rights concerns.
Toward a more accountable green transition
To address the BYD Hungary forced labour case in a meaningful way, several steps stand out. First, the Hungarian authorities in collaboration with EU‑level bodies could treat the submitted evidence as a formal complaint and launch a transparent, independent investigation into the Szeged plant, including unannounced inspections, worker interviews, and wage‑verification audits. If forced‑labour indicators are substantiated, the resulting sanctions and remedial measures should be clearly communicated as a precedent for other industrial projects.
Second, BYD could adopt a corrective‑action plan that publicly addresses back wages, returns withheld funds, and ensures future workers are hired under proper work‑permit arrangements with full access to labour protections. The analysis of the case suggests that without such a plan, the company risks undermining not only its own reputation but also the broader legitimacy of the green‑transition narrative.
Finally, from an EU‑policy standpoint, the BYD Hungary forced labour case should prompt a tightening of enforcement mechanisms for corporate‑due‑diligence and forced‑labour rules in the EV‑sector. This includes explicitly tying green‑subsidy access to verifiable compliance with labour‑rights standards, so that companies cannot trade ethical gaps for environmental points. In this way, the plant could become less a scandal and more a catalyst for embedding stronger labour‑rights safeguards into the EU’s green‑transition framework.
