Bulgaria HR Information

Updated on: 2025/08/05 15:25 (UTC)

Overview

The right to work is explicitly provided in the Bulgarian constitution. The relationship between an employee and an employer is primarily governed by the Labor Code of 1986 as amended and various rules and regulations. The provisions of the Labor Code cannot be contractually waived. The rights and obligations provided in collective or individual employment agreements may only provide the employee with more favorable terms than those set out in the Labor Code.

Hiring

Employment Contracts

Employment agreements must be in writing and must be registered with the local office of the National Revenue Agency. Employees may start working only after they have been provided with evidence that this registration has been made.

Employment agreements must contain details of the parties and specify:

• the place of work,
• the position and the character of the work,
• the signing date of the contract and the starting date of the performance of the duties,
• the duration of the employment agreement,
• the amount of basic and extended annual leave and of additional paid annual leave,
• the notice period to be observed by both parties upon termination of the employment agreement,
• the base salary and additional remuneration and the frequency of its payment, and
• the duration of the working day or week.

The employment agreement may be executed for an indefinite period or for a fixed term. Generally, fixed-term contracts are for periods of not less than one year and not longer than three years.

Employers can hire workers for a trial period of up to six months for purposes of determining the employee’s capability to perform the job. Such contracts could also be concluded in cases where the employee wants to ensure the work is suitable. In either case, the contract should expressly state in favor of which party the probation period has been agreed to, as this party is entitled to freely terminate the contract without notice.

Fixed-term contracts may be signed for seasonal or temporary activities or with the newly appointed employees of companies in liquidation or bankruptcy proceedings. In addition, fixed term contracts may be signed for temporary replacement of another employee or for completion of a certain job.

Fixed-term employment agreements become agreements for an indefinite duration if after the expiration of the term, the position is still vacant, the employee continues to work for more than five days and the employer does not object to this in writing.

Employers are obligated to assist fixed term employees in securing a permanent job by announcing vacant positions that may be occupied for an indefinite period of time.

Effective Aug. 1, 2022, employees have the right to request, in writing, that their employer amend their employment contracts to allow them to transition from a fixed-term to an indefinite employment contract, and/or from part-time to full-time work. Employers who wish to decline the request must provide their reasoning to the employee within one month.

The Labor Code provides for other types of employment relationships such as the performance of work at home, remote work and work performed through companies providing temporary work.

Effective Aug. 1, 2022, employees have a right to enter into a concurrent employment relationship with another employer. Employers can prohibit employees from exercising this right only to protect trade secrets or prevent conflicts of interest.

Effective Aug. 1, 2022, all costs related to employee training must be borne by the employer.

Restrictions on Hiring

The minimum age for lawful employment in Bulgaria is 16 years, although there are limited exceptions for positions that are not hazardous or harmful and for participation in the shooting of films and in theatrical and other productions.

Persons under 18 years of age can be employed only after a thorough medical examination to ensure they are fit for work and those under 16 only if their health and physical and mental development will not be impaired. Employers must have the permission of the labor authorities to hire anyone under 18.

Employees under the age of 18 have longer holidays (minimum 26 working days) and fewer working hours (maximum seven a day) than older workers and are not allowed to work overtime or nights.

The total number of foreign employees working for a large employer may not exceed 20 percent (35 percent for small and medium-sized employers) of the average number of Bulgarian citizens employed within the previous 12 months.

Employers may forego the labor market test and quota restriction when they are hiring:

• seasonal workers;
• managers, specialists, and trainees who will be coming from outside Bulgaria to work in the country as part of an intracompany transfer; and
• highly qualified EU Blue Card holders who will earn twice the average salary in Bulgaria.

Bulgaria has created a website to be used when posting workers to the country. All applications for posting of workers can only be filed electronically through the website.

Recordkeeping

Each employee has a “labor book” that officially verifies length of service. The labor book is issued by the first employer and delivered to the employee when the employment relationship is terminated. It includes details of the employee, including education, professional experience, salary received and compensation paid upon termination.

In addition, employers are required to keep a file for each employee including details of the employment relationship.

Background Checks

New hires must pass a medical examination and provide the employer with a certificate describing health status. Employers may not, however, discriminate on the basis of the health of the employee.

Noncompetition Agreements

Bulgarian law does not regulate noncompetition agreements, so restrictive covenants are not directly enforceable in Bulgaria, and breach of the noncompetition restrictions may lead only to a claim for payment of compensation.

Reference Citations

Employment Contracts: Labor Code, 1987 (as amended), arts. 61-71 (Bulgarian)

Restrictions on Hiring: Labor Code, 1987 (as amended), art. 301 (Bulgarian); Law on Labor Migration and Labor Mobility, 2016, art. 7 (Bulgarian)

Recordkeeping: Labor Code, 1987 (as amended), arts. 347-349 (Bulgarian)

Background Checks: Labor Code, 1987 (as amended), art. 287 (Bulgarian)

Immigration and Work Permits

In General

Work permits can only be granted to foreign nationals possessing skills or specialized knowledge that cannot be found in the Bulgarian labor market. The total number of foreign employees working for an employer generally may not exceed 10 percent of the average number of Bulgarian citizens employed within the previous 12 months. The employer should request a work permit for the prospective employee from the National Employment Agency.

Visas and Work Permits

Bulgarian employers cannot hire foreigners who illegally reside in Bulgaria or who do not have a work permit issued by the government. Requests for work permits must be sent to the National Employment Agency. Work permits are not required for managers and executive directors, scientists, and employees on short-term business trips. Work permits are valid for up to one year.

Work permits can only be granted to individuals possessing skills or specialized knowledge that cannot be found in the national labor market. The total number of foreign employees working for a large employer may not exceed 20 percent (35 percent for small and medium-sized employers) of the average number of Bulgarian citizens employed within the previous 12 months.

Employers may forego the labor market test and quota restriction when they are hiring:

• seasonal workers;
• managers, specialists, and trainees who will be coming from outside Bulgaria to work in the country as part of an intracompany transfer; and
• highly qualified EU Blue Card holders who will earn twice the average salary in Bulgaria.

After obtaining a work permit, foreign nationals must apply for a long-term residence visa and a residence permit. The residence visa allows multiple entry, is valid for up to one year, and can be extended upon reissuance of a work permit.

Residence visas for EU Blue Card holders are valid for three years.

Penalties

Employers that hire a foreign national who does not have the necessary permission to work are subject to a fine of 500 to 20,000 lev, the foreigner to a fine of 500 to 5,000 lev.

Reference Citations

Visas and Work Permits: Law on Employment Promotion, 2001 (as amended), art. 71 (Bulgarian); Law on Labor Migration and Labor Mobility, 2016, art. 7 (Bulgarian)

Nondiscrimination

In General

The law prohibits discrimination based on race, nationality, ethnic identity, sex, origin, religion, education, beliefs, political affiliation, union membership, personal and social status, property status, human genome, citizenship, disability, age, sexual orientation, marital status, and any other grounds established by law or by an international treaty to which Bulgaria is a party.

An employer who has received a complaint from an employee who believes that he or she is subject to harassment, including sexual harassment in the workplace, is under the obligation to immediately conduct an inquiry and take measures to stop the harassment and discipline the responsible employees.

Employers must generally adapt the workplace to accommodate employees with disabilities, and those with more than 50 employees must designate jobs suitable for occupational rehabilitation.

Employers must ensure equal working conditions for all employees, pay equal remuneration for equal or equivalent work and provide equal opportunities to employees for vocational training, enhancing qualifications, and retraining.

Types of Discrimination

Under the Constitution of the Republic of Bulgaria, all persons are equal in dignity and rights under the law. The constitution prohibits discrimination based on race, nationality, ethnic identity, sex, origin, religion, education, beliefs, political affiliation, personal and social status or property status.

The Protection Against Discrimination Act of 2003 generally bans any direct or indirect discrimination based on the categories listed in the constitution, as well as on human genome, citizenship, disability, age, sexual orientation, marital status and any other grounds established by law or by an international treaty to which Bulgaria is a party. The Labor Code adds affiliation with trade unions and other public organizations and movements, family and property status, existence of mental or physical disabilities and differences in the contract term and the duration of working time as protected statuses.

An employer may not set discriminatory requirements for employees when a job vacancy is announced. Employers must not demand from candidates information that may lead to discrimination before an employment agreement is signed.

The Commission for Protection Against Discrimination is responsible for enforcement of the antidiscrimination laws and regulations.

Disability Discrimination

The Protection Against Discrimination Act of 2003 generally bans any direct or indirect discrimination based on disability. The Labor Code adds existence of mental or physical disabilities as protected statuses.

Under Bulgarian law, an employer must adapt the workplace to the needs of persons with disabilities at the beginning of their employment or when the disability occurs after the beginning of employment, unless the costs of such adaptation are unreasonably high and would cause serious difficulties to the employer.

Employers with 50-99 employees must provide work for at least one permanently disabled person. Employers with more than 100 employees must provide work for people with disabilities in a number at least equal to two percent of their average number of personnel. Employers also must report the number of unoccupied positions designated for disabled persons and the qualification and experience required for each position to the Bulgarian Employment Agency.

Employers that fail to meet the obligations for hiring permanently disabled staff must pay a monthly compensation equal to 30 percent of the minimum monthly Bulgarian salary for each unoccupied job vacancy which has not been fulfilled. The obligation can be overruled only when:

• there are specific factors in the work environment that preclude the recruitment of permanently disabled people,
• there are no permanently disabled people registered and referred by the Labour Office Directorates or by recruitment intermediaries, or
• the employer applies alternative employment measures for permanently disabled people.

Gender Discrimination

The Constitution of the Republic of Bulgaria prohibits discrimination based on sex, and the Protection Against Discrimination Act of 2003 bans any direct or indirect discrimination based on marital status.

Under Bulgarian law, an employer who has received a complaint from an employee who believes that he or she is subject to harassment, including sexual harassment in the workplace, is under the obligation to immediately conduct an inquiry and take measures to stop the harassment, as well as to hold liable and take disciplinary action against the employees responsible for the harassment.

Employers must not refuse to employ a candidate on the grounds of pregnancy, maternity or raising a child.

Pay Discrimination

Employers must ensure equal working conditions for all employees, pay equal remuneration for equal or equivalent work and provide equal opportunities to employees for vocational training, enhancing qualifications and retraining.

EU Pay Transparency Directive: As a member state of the European Union, Bulgaria has until June 2026 to transpose the minimum requirements of the EU Pay Transparency Directiveinto its national law or amend any current pay equity laws to conform with the directive, which aims to promote pay equity between men and women. The directive introduces requirements on gender pay gap reporting, salary history bans during the hiring process, and wage disclosure in job vacancy listings. The national law may go beyond the minimum requirements of the directive, but the law may not directly conflict with the directive requirements.

Reference Citations

Nondiscrimination: Labor Code, 1987 (as amended), art. 8 (Bulgarian); Constitution of Bulgaria, 1991, art. 6

Disability Discrimination: Labor Code, 1987 (as amended), art. 315 (Bulgarian)

Gender Discrimination: Law on Protection Against Discrimination, 2003, arts. 4-5

Pay Discrimination: Law on Protection Against Discrimination, 2003, arts. 14

Employee Privacy

Employee Data

On May 25, 2018, the General Data Protection Regulation (GDPR) superseded the Data Protection Directive as the primary law governing data privacy in the EU. The GDPR establishes minimum requirements for the processing of employee data and allows EU member nations to introduce more restrictive local legislation. Stricter requirements can also be established in collective bargaining agreements or work contracts. For more information, see the In Focus: GDPR.

On March 2, 2019, the government enacted amendments to the Personal Data Protection Act, which implements the GDPR in Bulgaria. The amendments contain a few local exceptions to the GDPR, such as giving employers latitude to determine, on their own, the retention period (up to a maximum of six months) for the personal data of applicants. The Personal Data Protection Commission serves as the lead supervisory authority responsible for monitoring and enforcing data privacy laws in the country.

Employee Monitoring and Surveillance

Under the GDPR, employers can monitor employees only if there is a lawful basis for doing so. Lawful bases can include preventing employee misconduct, deterring crime, and ensuring compliance with health and safety procedures. Employees must be given prior notice, and any data that is collected must be used and kept only to fulfill its original purpose.

Under Bulgaria’s Labor Code, video monitoring of employees is only allowed in cases where the monitoring is necessary in order to control the work process and observation of working hours, and may only be implemented with consent of the employees. An employer may obtain consent for recording with a clause in the employment agreement. However, an employer must still consider employee privacy rights when implementing video monitoring.

Reference Citations

Employee Data: General Data Protection Regulation, 2016; Amendment and Supplement to the Law on the Protection of Personal Data, 2019 (in Bulgarian)

Employee Monitoring and Surveillance: General Data Protection Regulation, 2016; Labor Code, 1987 (as amended), art. 107 (Bulgarian)

Compensation

Hours of Work

The Labor Code provides for a five-day, 40-hour workweek. Eight hours is the standard length of the working day. In certain circumstances (usually relating to the production process), the workweek may be extended, although any extension of working hours should first be discussed with trade union or other employee representatives. In no case may the length of the workweek exceed 48 hours (56 hours in the event of summarized calculation of working time). Flexible and irregular work hours are allowed.

Employees are entitled to 12 hours of rest per day and 48 hours per week and to breaks during the workday. The lunch break cannot be less than 30 minutes.

Minimum Wage

Effective Jan. 1, 2023, the minimum monthly remuneration is 780 lev per month. Effective April 1, 2022, Bulgaria’s minimum wage was 710 lev per month.

While unilateral changes to employment contracts are generally prohibited, unilateral wage increases are explicitly permitted by law. Wage reductions, however, must be agreed to by the employee.

For each hour worked between 10 p.m. and 6 a.m., employees are entitled to additional remuneration of not less than 0.25 lev.

After one year’s service, employees are entitled to additional compensation based on length of service and professional experience. This compensation is calculated as a percentage of base monthly salary. An employee is entitled to seniority pay whether the work was done for the same employer or for different employers as long as the work is of the same or similar character.

Overtime

An employer must pay employees the following premiums for overtime work:

• an additional 50 percent of the standard daily wage for overtime worked during a workday,
• an additional 75 percent of the standard daily wage for hours worked on a nonworking day, and
• an additional 100 percent of the standard daily wage for hours worked on an official holiday.

Employees cannot be required to work more than two overtime hours a day.

Overtime worked on business days by employees on flexible schedules does not qualify for premium pay.

Certain categories of employees may not perform overtime work:

• employees under the age of 18,
• pregnant employees or employees in the advanced stages of in vitro treatment,
• mothers of children under 6 years old or of disabled children regardless of age (unless they consent),
• employees who have been successfully retrained as a result of disability (unless they consent),
• employees who work reduced hours and
• employees who are students (unless they consent).

Wage Payment

Employers must pay wages monthly as remuneration for work done under an employment contract. The Labor Code states that labor remuneration should be paid in cash but does not specify the currency or currencies that may be used.

Deductions from an employee’s wages are allowed only in cases provided for in the Labor Code or if agreed to by the employee.

Mandatory Bonuses

Year-end bonuses are not explicitly regulated by law and may be given at the discretion of the employer and included in the individual or collective employment agreement.

Reference Citations

Hours of Work: Labor Code, 1987 (as amended), art. 136 (Bulgarian)

Minimum Wage: State Social Security Budget Law 2022 (Bulgarian)

Overtime: Labor Code, 1987, art. 143-144 (Bulgarian)

Wage Payment: Labor Code, 1987 (as amended), art. 269, 272 (Bulgarian)

Benefits

Vacation

An employee who has worked for an employer at least eight months is entitled to paid annual leave of a minimum 20 working days. Collective and individual employment agreements may provide for additional leave. Employees who work under specific conditions or under a flexible working schedule and certain categories of personnel listed in the Ordinance of the Councils of Ministers (mainly in education and science) also have the right to additional paid leave. Regular salary or wages continue during annual leave.

Under the Labor Code, paid annual leave should generally be used during the year earned, although up to half can be postponed.

An employer can require an employee to take annual leave in the case of:

• a work stoppage of more than five days;
• a legislative act, collective bargaining agreement or company rule requiring all employees to simultaneously take leave; or
• an employee who has not requested leave by the end of the year for which it is due.

The use of paid annual leave may be postponed:

• for valid reasons by the employee with the employer’s consent,
• by the employer due to business reasons (although at least half of the annual leave should be granted to the employee in the calendar year for which it is due) or
• if the employee is taking another kind of leave when annual leave is scheduled (maternity leave, sick leave, etc.).

If all paid annual leave has not been used within two years of the year earned regardless of the reason, the employee’s right to the leave ends.

Upon termination of employment, the employee is entitled to compensation for unused annual leave.

Holidays

Bulgaria observes the following 14 holidays:

• Jan. 1: New Year
• March 3: Day of the Liberation of Bulgaria from Ottoman Domination
• Good Friday
• Holy Saturday
• Easter
• Easter Monday
• May 1: Labor and International Workers’ Solidarity Day
• May 6: St. George’s Day
• May 24: Day of Bulgarian Education and Culture
• Sept. 6: Bulgaria-Rumelia Union Day
• Sept. 22: Bulgaria Independence Day
• Dec. 24: Christmas Eve
• Dec. 25 and 26: Christmas

Public holidays that take place on a weekend are not carried over to the following Monday. When a public holiday takes place on a Tuesday, Wednesday or Thursday, the Monday or Friday is sometimes taken as an official holiday to make a long weekend.

Employees who are required to work on a public holiday are entitled to be paid double time.

The Council of Ministers has the right to announce other days as public holidays or holidays for the commemoration of certain professions. The council approves a list of religious holidays for religions other than the Christian Orthodox faith. Employees of other religions are entitled to request paid or unpaid leave on the approved dates. However, these days off are not in addition to annual paid leave but are a part of it. Therefore, the only obligation of the employer is to allow the use of the leave on these specific dates, if the employee so requests.

Maternity Leave

Female employees are entitled to 410 days of paid maternity leave for each child, of which 45 days must be used before the expected delivery. When the child’s birth occurs before the 45th day, the unused time is added to postnatal leave. During this period, the mother receives compensation from public social security funds in an amount equal to 90 percent of her average daily gross salary or the average daily income on which social security contributions have been calculated. Following maternity leave, a female employee is entitled to an additional two years’ leave provided that the child is not in a child-care establishment.

Pregnant women, women on maternity leave and women with children of up to three years of age have special protection related to dismissal.

Paternity Leave

Fathers who have acquired 12 months’ working experience are entitled to 15 days’ leave after the newborn child is discharged from the hospital. During this period, the father receives compensation from public social security funds in an amount equal to 90 percent of his average daily gross salary or the average daily income on which social security contributions have been calculated. After the child turns six months old, the father can use maternity leave until the expiration of the 410-day period. In addition, the mother’s statutory leave entitlement covering the first two years of a child’s life can be transferred to the father with the mother’s consent.

Effective Aug. 1, 2022, fathers are entitled to take two months of leave to raise a child under age eight if none of the types of leave that the mother can transfer to the father was transferred. If less then two months of leave was transferred, then the amount transferred is subtracted from the two-month entitlement and the father is entitled to any remaining part of the two months.

Sick Leave

Employees who have contributed to the social security fund for at least six months are entitled to up to 18 months’ paid sick leave. The employer must pay the employee 70 percent of average daily remuneration during the first three days of missed work, after which compensation is paid by the National Social Security Institute. The sick pay benefit from the National Social Security Institute is 80 percent of average daily remuneration if the temporary disability is due to general sickness, 90 percent in the case of an employment injury or occupational disease. Compensation is only payable if a medical certificate is provided attesting to the disability.

Other Leave

Adoption leave. In cases of adoption, the adoptive mother is entitled to maternity leave of 410 days minus the child’s age on the day it was given up for adoption. An adoptive mother of a child aged 2 to 5 years is entitled to 365 days of leave, which can be used no later than the child’s fifth birthday. After the child turns 6 months old, the adoptive father can use maternity leave until the expiration of the 410-day period. Adoptive fathers of children who are older than 2 at the time of adoption are entitled to 365 days’ leave.

Personal leave. Employees are entitled to two days of paid leave for their wedding, for bereavement and for blood donation and to paid leave to perform certain civic duties (e.g., being a witness or a juror).

At the employee’s request, an employer may grant unpaid leave whether or not the employee has exhausted paid annual leave or worked sufficiently long to qualify for paid leave. Thirty days of annual unpaid leave are taken into consideration when calculating length of service.

Education leave. With the prior consent of the employer, employees studying at high school or university are entitled to 25 days’ paid leave per academic year, 30 days’ during the graduation year to prepare for final exams and fulfill other graduation requirements.

Pensions and Social Security

The retirement age for men is 64 with 38 years of contributions and will gradually increase to 65 in 2029. The retirement age for women is 61 with 35 years of contributions and will gradually increase until it reaches 63 in 2020 and 65 in 2037. The required years of contributions will gradually rise to 40 years for men and 37 years for women.

The Bulgarian social security system consists of medical and social insurance.

Social security providers are the National Social Security Institute and the National Health Insurance Fund. Social security contributions are collected by the National Revenue Agency.

All employees hired for more than five days or 40 hours per calendar month are subject to mandatory Public Social Security, which provides compensation, aid and pensions in cases of temporary disability, temporary reduced ability to work, permanent disability, maternity leave, unemployment, retirement and death.

Social security and health insurance contributions are paid by the employer and the employee.

An employer’s cost for each employee (social insurance, health insurance and pension contributions) averages 16 percent of salary.

Workers’ Compensation

All employers are required to contribute to the Labor Accident and Occupational Diseases fund administered by the National Social Security Institute. Employees and/or their beneficiaries receive compensation for job-related temporary or permanent disability, retraining as a result of disability, and death.

Employers are obligated to provide insurance against work-related accidents for employees assigned hazardous duties (those for which the level of reported work-related accidents is equal to or higher than the national average). Insurance covers death, permanent disability, and temporary disability caused by employment accidents.

Reference Citations

Vacation: Labor Code, 1987 (as amended), arts. 155, 173 (Bulgarian)

Holidays: Labor Code, 1987 (as amended), arts. 154, 264 (Bulgarian)

Maternity Leave: Labor Code, 1987 (as amended), arts. 163-164 (Bulgarian)

Paternity Leave: Labor Code, 1987 (as amended), arts. 163-164 (Bulgarian)

Sick Leave: Labor Code, 1987 (as amended), art. 162 (Bulgarian)

Other Leave: Labor Code, 1987 (as amended), art. 157 (Bulgarian)

Pensions and Social Security: Social Security Code, 1999 (as amended), art. 11

Workers’ Compensation: Labor Code, 1987 (as amended), art. 200 (Bulgarian)

Labor Relations

In General

Employees may join a union at their discretion, and employees who are not members of a union may nevertheless benefit from the union’s collective bargaining activities. Management decisions about employment and social security can only be made after consultation with the representatives of the employees.

The constitution gives employees the right to strike if mediation of a dispute fails. Employers may not hire substitute employees in place of those who are on strike.

In cases where a business is sold or transferred, the successor employer becomes responsible for its predecessor’s rights, privileges, and duties towards the employees under the collective agreement.

Right to Organize

The government will recognize a labor union at the national level if it has at least 50,000 registered members. Organizations must be present in more than one-fourth of the industry branches, must have regional representative bodies in more than one fourth of the municipalities in the country, and must have a national governing body. A national union must be established as a corporate entity at least three years before it applies for recognition by state authorities.

Trade unions recognized at the national level have the right to negotiate and sign collective bargaining agreements at sector, branch or municipal levels. They may influence the economic and financial policy of the country by participating with the government and employers’ organizations in the management of the National Social Security Institute, the National Health Insurance Fund and similar bodies.

Trade unions also play a key role in the preparation of internal rules and regulations and in representation before competent courts and other governmental bodies.

Employees may join a union at their discretion. Employees who are not members of a union may nevertheless benefit from the union’s collective bargaining agreement by applying to the employer or the union’s governing body.

All union members must pay membership fees.

Under the Labor Code, management decisions about employment and social security must be made after consultation with the representatives of the employees.

Employees of limited liability companies must be allowed to participate in decisions on labor and social issues. The general meeting of shareholders must hear the views of employee representatives before making decisions on labor and social issues. Where the number of employees exceeds 50, they have the right to be represented in the general meeting and are entitled to an advisory vote.

Employees of joint stock companies with more than 50 employees are entitled to be represented at the general meeting of shareholders and are allowed one advisory vote.

Works Councils

The Labor Code does not address works councils.

Dispute Resolution

Disputes between employer and employee related to the creation, existence, performance and termination of the employment relationship are resolved by the courts of general jurisdiction.

Collective employment disputes may be settled under the Law on Arbitration of Collective Employment Disputes. The goal is to conduct negotiations in order to settle the dispute by mutual agreement. If negotiations are not successful, the parties may refer the dispute to the National Institute for Settlement and Arbitration, which will assist them in resolving the dispute through mediation. If the disagreement is still not resolved, the parties may agree on a hearing before an arbitration court or a single arbitrator, whose decisions are final. When the subject of the dispute is nonperformance of a collective labor agreement, collective employment disputes can be resolved through a court procedure.

Strikes and Lockouts

The constitution gives employees the right to strike. The strike may be active or symbolic, the latter involving the wearing of appropriate symbols (armbands, badges), placing of protest posters and other forms of protest.

An active strike must:

• involve a collective employment dispute,
• be preceded by a written presentation of employee claims,
• have been unsuccessfully mediated,
• have been approved by union membership and
• be preceded by at least seven days’ notice to the employer.

Employees may not strike in defense of political or unconstitutional claims, during natural disasters or to protest individual employment disputes.

During a legal strike, an employer may not discontinue business activities, dismiss employees who are on strike or hire substitute employees in place of those who are on strike in order to prevent or discontinue the strike.

Successorship Clauses

In cases where a business is sold or transferred, the successor employer becomes responsible for its predecessor’s rights, privileges and duties towards the employees under the collective agreement.

Reference Citations

Right to Organize: Labor Code, 1987 (as amended), arts. 4-6 (Bulgarian)

Strikes and Lockouts: Constitution of Bulgaria, 1991, art. 50; Law on Settlement of Collective Labor Disputes, 1990, art. 11 (Bulgarian)

Successorship Clauses: Labor Code, 1987 (as amended), art. 123 (Bulgarian)

Safety, Health and Security

In General

Employers are responsible for the health and safety of their employees and should conduct a risk assessment to identify workplace dangers and implement measures to prevent occupational diseases and work-related accidents. Employees should submit to medical examinations at the time of hiring and periodically thereafter to ensure their ability to perform required work. Companies must form working conditions groups with employee and employer members to monitor workplace safety.

Employees may not consume alcoholic drinks or use other addictive substances during working hours.

Workplace Safety and Health

Employers are responsible for the health and safety of their employees, including those who work remotely, and bear all costs related to providing safe working conditions.

Employers should conduct a risk assessment to identify workplace dangers and implement measures to prevent occupational diseases and work-related accidents. Risks should be reassessed when there are changes in working conditions.

Employers must supply work clothes and protective equipment to employees who work in hazardous situations or with dangerous machinery or substances.

Employers must ensure that each employee receives appropriate health and safety training at the beginning of employment and periodically thereafter.

Employees in occupations with high levels of health and safety hazards that cannot be eliminated or reduced (for example, the coal and mining industry) have the right to work reduced hours (with no reduction in pay) if this will limit health hazards. These employees are also entitled to an additional five days of paid leave per year.

Employees should submit to medical examinations at the time of hiring and periodically thereafter throughout the duration of employment. The purpose of the initial medical examination is to determine whether the prospective employee suffers from any medical condition that may prevent him or her from performing required duties. Periodic medical examinations are intended to discover work-related illnesses or any general deterioration in the employee’s health. The frequency of medical examinations depends on the type of work performed, working conditions and the age of the employee.

Companies employing more than 50 workers must have internal working conditions commissions composed of not more than 10 employer and employee representatives. The purpose of commissions is to evaluate and reduce work-related hazards. Companies employing from five to 50 people and the departments of larger companies form working conditions groups, which include a representative of the employer (or the head of the department) and one representative of the employees.

Drug and Alcohol Use

The Labor Code expressly provides that employees report to work in a condition allowing them to perform their duties. Employees may not consume alcoholic drinks or use other addictive substances during working hours. Employees may be required under company rules to undergo tests for such substances.

Employees may not smoke at work or in public places.

Reference Citations

Workplace Safety and Health: Labor Code, 1987 (as amended), arts. 107, 275, 281-284 (Bulgarian)

Drug and Alcohol Use: Labor Code, 1987 (as amended), arts. 126, 199 (Bulgarian)

Termination

Termination by Employer

Employment agreements may be terminated with or without notice by mutual consent of both parties or unilaterally by the employee or the employer. Termination is heavily regulated by the Labor Code.

Employers may impose disciplinary sanctions on employees for violations of work rules, including reprimands, warnings or dismissal. Acceptable reasons for disciplinary dismissal are specified in law and include:

• reporting to work late (or departing early) on three occasions, each not less than one hour within one month;
• unjustified absence for two consecutive working days;
• continual violation of disciplinary rules;
• abuse of employer confidence;
• divulging proprietary information;
• for employees working in the commerce or services industry, causing damages to customers by defrauding with the price, weight, quality of the good or service; and
• online gambling via the employer’s telecommunications equipment.

The employer may terminate the employment agreement without notice in certain limited cases, including:

• the employee being banned from practicing a profession or from occupying an employment position by a court order or an administrative decision,
• refusal by the employee to take a medically prescribed job offered to him or her and
• disciplinary dismissal.

Employers may terminate employees with prior notice in the event of:

• closing of the business,
• downsizing or layoffs,
• reduction of workload,
• work stoppage for more than 15 working days,
• poor performance,
• failure to meet educational requirements of the assigned position,
• refusal to work in another location,
• reinstatement of an unlawfully dismissed employee who had previously occupied the same position,
• qualification for retirement,
• the employment relationship having been entered into after the employee acquired and exercised his right to retire,
• changed job requirements rendering the employee unqualified for the position and
• inability to continue the employment relationship.

Notice of termination of an employment agreement must be given in writing. In general, the notice period is 30 days unless the parties have agreed on a longer period, which may not exceed three months.

Some categories of employees enjoy special protection under the Labor Code and may only be terminated with the prior approval of the labor authorities:

• mothers of children under the age of 3,
• employees undergoing occupational rehabilitation,
• employees suffering from certain illnesses,
• employees on leave or vacation,
• employees elected as workers’ representatives,
• employees elected as health and safety representatives and
• members of special negotiating bodies or European works councils and representatives of a European company or cooperative.

In addition, pregnant women can only be dismissed with notice and only on grounds stipulated in the Labor Code, trade union officers may be terminated only with the prior consent of the trade union and employees on maternity leave may only be terminated in the event of closing of the business.

Whistleblowing. Effective May 4, 2023, private-sector employers in Bulgaria must comply with the country’s Whistleblowing Act, which transposes the EU Directive on Whistleblowing into national law. Small employers with between 50 to 249 workers are required to comply with the law no later than Dec. 17, 2023. The law requires covered employers to implement whistleblower policies and reporting mechanisms for individuals to report corporate and labor-related violations and breaches.

Termination by Employee

Under the Labor Code, employees have the right to terminate the employment agreement with or without notice. When the employee terminates with prior notice, no reason need be given the employer. Legally valid reasons for immediate termination by the employee include:

• inability to perform required duties due to illness and refusal by the employer to provide alternative employment,
• delay in payment of wages and
• unlawful changes to the employment agreement by the employer.

Plant Closings and Mass Layoffs

Group (or mass) layoffs are terminations by the employer for reasons not related to the performance of employees when within 30 days the employer intends to serve termination notices (or offer settlements) to:

• 10 employees if less than 100 employees but more than 20 are employed,
• 10 percent of the workforce if at least 100 but less than 300 employees are employed or
• 30 employees if at least 300 employees are employed.

Employers are obligated to start consultations with the employees regarding any planned group layoffs at least 45 days before termination takes place.

In addition, employers are obligated to notify the Employment Agency and the employees’ staff representatives in writing about the group layoffs at least 30 days before the termination takes place. The relevant municipal administration, the respective branch of the National Social Security Institute and the labor authorities must also be informed.

Payment on Termination

Employers may induce employees to leave employment in exchange for compensation in an amount not less than four months’ gross salary.

Unemployment Insurance

Those eligible to apply for unemployment insurance include:

• Bulgarian citizens,
• EU/EEA and Swiss citizens,
• foreigners with permanent residence permits, and
• foreigners, subject to international treaties to which Bulgaria is a party.

To qualify for unemployment benefits, an individual must have had more than 15 years of unemployment insurance coverage after Dec. 31, 2001, and made social insurance contributions for at least 15 of the last 18 months. The average daily unemployment benefit equals 60 percent of the applicant’s average daily wage during the last nine-month period social insurance contributions were made.

The length of time for which an unemployed person can receive benefits varies depending on how long the applicant worked and made social insurance contributions. Employees fired for gross misconduct are not eligible for unemployment benefits.

Reference Citations

Termination by Employer: Labor Code, 1987 (as amended), arts. 187, 190, 325, 328, 330 (Bulgarian)

Termination by Employee: Labor Code, 1987 (as amended), arts. 326-327 (Bulgarian)

Plant Closings and Mass Layoffs: Labor Code, 1987 (as amended), art. 130 (Bulgarian)

Payment on Termination: Labor Code, 1987 (as amended), art. 331 (Bulgarian)

Unemployment Insurance: Social Security Code, 1999 (as amended), art. 54a; Social Security Budget Act, 2018 (Bulgarian)

Personal Taxes

Residency Requirements

Residents for tax purposes are individuals who reside in Bulgaria for more than 183 days in any 12-month period or have a “center of vital interests” (determined by factors including permanent address, family, employment, and possession of property) in Bulgaria.

Taxable Income

Bulgaria taxes its residents on their worldwide income, nonresidents only on Bulgaria-sourced income. The income of expatriates working in Bulgaria is treated as sourced in Bulgaria and subject to Bulgarian income tax regardless of the place of payment.

Tax Rates

Individual income is taxed at a flat rate of 10 percent.

Employers are required to make mandatory contributions to the social insurance fund for each employee. The base for the contribution is total income, capped at 2,600 lev per month. Employers must also withhold employee contributions for the social insurance fund.

Applicable contribution rates for some of the social security contribution types are based on whether the employee to which wages were paid and upon which the contributions are assessed was born before Jan. 1, 1960, or after that date. An employee’s work category, also known as category of labor, also affects contribution rates for some of the social security contribution types. There are three applicable work categories. The first work category is for employment that involves especially dangerous working conditions regarding risk of harm. The second work category is for employment that involves an above-average level of workplace risk of harm. The third work category is for all other types of employment.

Health Insurance/Sickness Insurance: The standard health insurance contribution rate for employers is 4.8 percent and the standard health insurance contribution rate for employees is 3.2 percent. The health insurance contribution rate for the illness and maternity fund assessed on employers is 2.1 percent and the health insurance contribution rate for the illness and maternity fund assessed on employees is 1.4 percent.

Old Age, Disability, and Survivors’ Insurance: The old age, disability, and survivors’ insurance contribution rate for employers of employees in the first and second work categories who were born before 1960 is 13.46 percent; the old age, disability, and survivors’ insurance contribution rate for employers of employees in the third work category who were born before 1960 is 10.46 percent; and the old age, disability, and survivors’ insurance contribution rate for employees who were born before 1960 is 8.34 percent. The old age, disability, and survivors’ insurance contribution rate for employers of employees in the first and second work categories who were born during 1960 or later is 10.66 percent; the old age, disability, and survivors’ insurance contribution rate for employers of employees in the third work category who were born during 1960 or later is 7.66 percent; and the old age, disability, and survivors’ insurance contribution rate for employees who were born during 1960 or later is 6.14 percent.

Supplementary Pension Insurance: Supplementary pension insurance contribution rates include up to two types of components: a professional fund rate and a compulsory contribution rate. Employers of employees in the first work category, regardless of when the employees were born, are assessed a professional fund rate of 12 percent, and employers of employees in the second work category, regardless of when the employees were born, are assessed a professional fund rate of 7 percent. An employer’s overall contribution rate for supplementary pension insurance can be higher than the rate that would be applicable because of the professional fund rate if the employer also is required to pay a compulsory contribution rate.

The supplementary pension insurance contribution rate for employers of employees in the first work category who were born before 1960 is 12 percent, the supplementary pension insurance contribution rate for employers of employees in the second work category who were born before 1960 is 7 percent, there is no supplemental pension insurance contribution rate for employers of employees in the third work category who were born before 1960, and there is no supplemental pension insurance contribution rate for employees who were born before 1960.

The supplementary pension insurance contribution rate for employers of employees in the first work category who were born during 1960 or later is 14.8 percent (12 percent professional fund rate plus 2.8 percent compulsory contribution rate), the supplementary pension insurance contribution rate for employers of employees in the second work category who were born during 1960 or later is 9.8 percent (7 percent professional fund rate plus 2.8 percent compulsory contribution rate), the supplementary pension insurance contribution rate for employers of employees in the third work category who were born during 1960 or later is 2.8 percent, and the supplementary pension insurance contribution rate for employees who were born during 1960 or later is 2.2 percent.

Unemployment Insurance: The unemployment insurance contribution rate for employers is 0.6 percent and the unemployment insurance contribution rate for employees is 0.4 percent.

Insurance for Work Accidents and Occupational Diseases: Employer contribution rates for insurance for work accidents and occupational diseases range from 0.4 percent to 1.1 percent dependent on the employer’s work category and risk factors, and employees are not assessed a contribution rate for this type of insurance.

Reference Citations

Bulgaria Corporate Income Tax Act, 2007 (Bulgarian)

Web References

In English unless otherwise noted.

Law and Regulation

Constitution of Bulgaria

Labor Code (Bulgarian)

Law on Protection Against Discrimination

Law on Settlement of Collective Labor Disputes (Bulgarian)

Social Security Code