The Bulgarian Labour Code governs all employment relationships in Bulgaria. Other important acts governing employment relationships in Bulgaria are Bulgarian Social Insurance Code, Law on Health and Safety at Work, Law on the settlement of collective labour disputes, etc.
Overall control over observance of labour legislation in all sectors and activities is exercised by the Executive Agency “Chief labour inspectorate” at the Minister of Labour and Social Policy (the Agency). The Agency has the right to impose coercive administrative measures and administrative penalties in case of breach of the rules established in the labour legislation.
Employment contract
According to the Bulgarian Labour Code (the LC) all employment contract must be concluded in written. The written form of the employment contract is obligatory for its validity.
The employment contract has a mandatory content defined by the Labour Code such as: identity of the parties, place of work, job description, term and duration, termination notice period, basic remuneration, etc. The employment contract may contain other clauses that differ from the described clauses. It is to be noted that, if there is a collective labour agreement concluded prior to the individual contract, the individual clauses of the latter should be more favourable to the employee than those in the collective agreement, otherwise the individual clauses shall be considered void.
An inseparable element of the employment contract is the job description (a detailed description of the employee’s rights and obligations regarding the respective position). Тhe job description must be provided by the employer to the employee at the conclusion of the contract.
The employer has an obligation to report the conclusion of an employment contract within a time period of three days to the National Revenue Agency.
There are two types of employment contracts in Bulgaria – fixed term (for a maximum period of three years or for a shorter amount of time until the work stipulated in the contract is completed) and with an indefinite period (which cannot be transformed into fixed term contracts).
Working hours/ Leave
The normal working day in Bulgaria has eight hours and the working week has a usual duration of 40 hours. There are special rules for night work and overtime.
Employees in Bulgaria are entitled to an annual paid leave (no less than 20 working days). Upon request, the employee may be granted unpaid leave of up to 30 days per year.
According to the Bulgarian Labour Law female employees are entitled to a leave for pregnancy and birth amounting to 410 days for each child, of which 45 days shall obligatorily be used before the childbirth. The father is also entitled to paternity leave once the child is born, subject to the mother’s consent and according to the remaining days of the available maternity leave. After the leave for pregnancy, childbirth or adoption has been used, in case the child is not placed in a child-care establishment, the female employee is entitled to an additional leave for raising a first, second, and third child until\ they reach 2 years of age, and 6 months for each subsequent child.
Social security
Any person working in Bulgaria is subject to social security in the country. The employer, in the capacity as insurer in accordance with art. 5 of the Social Security Code (SSC), is obliged to withhold and pay social security and health insurance contributions to its employees on a monthly basis. The social security and health insurance contributions are due on the total gross remuneration of each employee within the minimum and maximum thresholds set out by law. Social security contributions in Bulgaria are divided between the employer and the employee. The employer has to pay 60 % of the insurance contributions, the employee the remaining 40 %.
Termination/ Cancelation of an employment contract
Employers may dismiss employees in Bulgaria only on the grounds explicitly stated in the law. When an employee is dismissed, he/she is normally entitled to their notice period salary and compensation for unused annual paid leave. When the dismissal was unlawful, the employee is also entitled to compensation for the period of unemployment due to the dismissal.
Termination of the employment contract may be done by mutual consent or unilaterally. When the contract is terminated, the employee is entitled to compensation for unused annual paid leave.
The applicable notice periods for termination/cancelation are: one month for employment contracts concluded for an indefinite amount of time (unless otherwise specified in the contract, but no more than three months) and three months for fixed term contracts.
The employer and the employee have the option to terminate the employment contract without a notice of termination when: (i) there is a mutual consent (expressed in a termination agreement); (ii) upon the expiration of the contractual term; (iii) if it is impossible for the employee to perform his work (because of an illness resulting in permanently reduced working capacity or health contraindications established by an expert medical commission), (iv) and other grounds explicitly stated in the law.
Article 333 of the Bulgarian Labour Code provides special protection for employees according to which before proceeding to the termination of employment on the grounds expressly provided for in the provision, the employer must seek and obtain permission from the labour inspectorate or the consent of a trade union body. This protection applies to special cases, for example when the employee is in permitted leave, when there are staff cuts or reduction of the volume of work, etc.
Work/Residency permits
The rules governing the employment contract with a foreign citizen are defined in the Foreigners in the Republic of Bulgaria Act, the Labour Migration and Labour Mobility Act, the Regulations on the Application of the Labour Migration and Labour Mobility Act.
Employers are entitled to hire foreign citizens within in Republic of Bulgaria only if they have obtained a work permit (for non-EU citizen). The work permit is issued by the Employment Agency in the Republic of Bulgaria.
EU citizens can work in Bulgaria, without being obliged to have a work permit. However, citizens of the European Union may reside in the Republic of Bulgaria with a valid ID card or a valid passport for up to three months. If an EU citizen has to reside on a long-term or permanent basis in the Republic of Bulgaria, she/he should obtain a certificate issued by the respective authorities to the Ministry of Interior or the Ministry of Internal Affairs.
Another legal basis for a foreign citizen to obtain a residence and work permit in Bulgaria is the “EU-Blue Card”. In order to apply for an EU-Blue Card the foreigner must meet certain requirements stated in the law such as possess university degree of at least three years of studying. In order to apply for an EU Blue Card, the foreigner should first obtain a permit for exercising of highly-qualified employment and a long-stay visa. The permit for exercising of highly-qualified employment is issued by the Bulgarian Employment Agency within fifteen calendar days following the submission of the relevant application and required documents. The procedure for obtaining the permit from the Employment Agency should be initiated by the local employer of the foreigner. For the purpose of obtaining of an EU Blue Card the foreigner must file an application to the Migration Directorate at the Ministry of Internal Affairs.