Office Bulgaria / Sofia
Oborishte Str. 1, BG-1504
Tel.: +359 (0)2 / 489 08 67
Tel.: +359 (0)2 / 846 80 46
Tel.: +359 (0)2 / 489 12 38

Office Germany / Hamburg
Mattentwiete 8, D-20457
Tel.: + 49 (0)40 / 41 46 450

Employment Law in Bulgaria

Employment Lawyers. Industrial Relations
& Employment Services by COELER LEGAL Consulting, Sofia

Based on more than 20 years experience on the Bulgarian market and international investment, COELER LEGAL is a permanent legal advisor to a large number of companies in the field of Employment Law. We draft
and develop labour contracts, service and management agreements according to Bulgarian Law and adjust
them to the needs and interests of the investor considering the company´s strategy as well as economical and tax issues.

We do not only give legal advice to our clients but jointly develop solutions for practical staff problems and conflicts. In this respect, legal knowledge and experience are at least as much important as understanding the 
mentality and negotiation skills.

Our Legal Services in terms of Employment Law include:

  • Individual Drafting, Examining and Negotiating of Labour and Service Contracts
  • Representation in Employment Conflicts, in particular Termination Proceedings
  • Unfair Dismissal and Redundancy Claims
  • Compromise Agreements
  • Discrimination Claims
  • Breach of Contract
  • Contracts, Procedures and Policies
  • Restrictive Covenants
  • Termination of Employment
  • Recruitment Issues
  • Data Protection Issues
  • Disciplinary and Grievance Procedures
  • Consultancy and Service Agreement
  • Developing and Implementation of Flexible Work Time Schemes
  • Drafting of Termination Agreements
  • Representation before State Authorities and Works Council
  • Restructuring Issues, Liquidation and M&A related Labour Issues (Transfer of Undertakings [TUPE] Regulations)

Free First Assessment on Your Employment Law Issue

When you need experienced Bulgarian lawyers in the field of Employment Law, please do not hesitate to contact us and send us your request or legal issue for reviewal. We will immediately give you our first assessment of the case without any charge.

Introduction to Employment Law in Bulgaria

In the following the most essential rules are outlined, which must be taken into account when employing people in Bulgaria. The basis is the labour code, which is applied to all employment relationships/working conditions, irrespective thereof, whether the employer is a foreign or domestic company. Supplementary the Law on Foreign Investments is applicable. According to its Art 14, all working conditions concerning people affected by this law, are regulated in the contract of employment, whereby a certain minimum standard of the Bulgarian industrial law must be adhered to.

Employment contract

All relevant rules between employer and employee must be stipulated in a written contract of employment, which must contain the following minimum information/details (Art. 66 Abs 1 Labour Code State Gazette 48 / 13.06.2006):

  • Job location 
  • Job description and scope of work
  • Date of contract, starting date and time
  • Duration of the contract of employment
  • Holidays
  • Period of notice
  • Remuneration
  • Daily and weekly hours of work

The minimum age of an employee is 16. Further compelling rules can be covered in collective agreements. Otherwise is the configuration of the employment contract free. If a written form is missing, the contract of employment contravenes against other legal regulations or collective agreements, even so a contract of employment came about which is covered by regulations laid down in law. Because the level of remuneration is not stipulated by law, one should pay heed to the form, in order to avoid long-winded legal proceedings. Besides the courts wills always constitute amendments made to the contract of employment in favour of the employee.

Minimum wage

The minimum wage is fixed by ordinance of the council of ministers and amounts to € 92,00 per month (July 2009). From October 2008 it will increase to  117,50 and from 2009 to  122,70. Minimum wages fixed by collective agreement also exist; they are not allowed to fall below the national minimum wage.

Trial period and time limitation

At the beginning of the employment relationship a trial period of 6 months can be stipulated, which only becomes effective in law, if agreed upon in writing. The employment contract can be terminated without notice from both contracting parties without any given reason.The conclusion of a temporary contract of employment is permissible for a period of 3 years and only in conclusively, by law regulated, for example:

  • Completion of a certain activity/operation or project
  • Temporary stand-in for another employee
  • For a certain assignment
  • For a certain position to be occupied by selection procedure
  • Seasonal job

For workings, having a temporary or occasional character, the temporary employment contract may only be renewed once, for a minimum of 1 year. A temporary contract employment can be changed to an indefinite contract by both contracting parties by mutual agreement .The same applies, if the employee continues to work after the limitation has elapsed, without veto on the part of the employer.

Working hours

The daily normal working hour are 8 hours, night work up to 7 hours. Per working day a 30 minute break must be allowed for. The weekly normal working hours is up to 40 hours, night work (from 22 hrs to 06 hrs) up to 35 hours. The maximum allowable weekly hours of work including overtime is 48 hours daily work, 44 hours night work. The normal daily working hours must not exceed 10 hours.

Working overtime is principally not allowed (Art 143 para 2 Labour Code), exceptions only under tight premise, for example, prevention of impending damages or removal of damages. The extent of overtime must not exceed 6 hours (night work 4 hours) per week, 30 hours (night work 20 hours) per month and 150 hours per year. During two consecutive days no more than a total of 3 hours (night work 2) overtime are allowed. In case overtime is afforded, an overtime premium must be paid; payment in lieu for holiday is excepted. The premiums amount to a minimum of:

  • 50% for work on regular working days
  • 75% for work on days of rest (Sundays)
  • 100% on statutory holidays

They have to be listed separately and are being checked biannually by the industrial inspectorate.

Shift work is allowed. If one shift comprises more than 4 hours work at night, the whole shift is deemed night work. Two consecutive shifts must not be carried out by one employee. The change of shifts is stipulated within the workshop or collective labour agreement.


A Bulgarian employee is entitled to a holiday after eights month's work within the framework of the contract of employment. The duration of the minimum holiday is subject to how long he has been employed in the company. In the first 10 years of his employment with a company he would be entitled to 14 working days, between 10 and 15 years minimum 16 working days and from 15 years employment minimum 16 working days. In particular cases- for example rehabilitation or working conditions harmful to health, extensions are provided. Holiday provisions are regularly implemented by the council of ministers and are subject-matter of collective agreements.

Termination of employment

Termination of employment requires written form by the employer and employee in order to be effective by law. The employer may terminate employment of the employee only if certain statutory grounds are at hand. The employee can terminate employment without any specific reason. One has to distinguish between orderly termination of employment by, for example, expiry of the term, mutual agreement or termination agreement, orderly resignation under adherence to the statutory term of notice as well as termination for cause (constructive dismissal) with or without warning. The term of notice is principally 30 days for an orderly termination; a period of three months notice can be agreed upon. Also temporary service contracts can be terminated. Giving notice to an employee can be substantiated on organisational grounds or circumstances related to the person (dismissal on grounds of conduct). The scope of flexibility on the part of the employer, within the legal framework, is quite large relatively speaking, because industrial safety legislation has not extensively fully qualified in the jurisdiction yet, like in Western Europe.

  • Factory closure, part closure and staff reductions
  • Work reduction or work interruption for more than 30 days
  • Lack of skill/suitability or missing qualifications of the employee
  • Refusal of the employee to take up work at another location
  • Reaching the age of retirement
  • Objective impossibility to keep the employee

An employee can hand in his resignation without notice:

  • if he is unable to do the work due to ill health or sickness and alternative employment doesn't exist
  • when the employer is defaulting payment of wages
  • other statutory reasons (National service)

The statutory period of notice for indefinite contracts of employment is normally 30 days. A longer term can be agreed upon in the employment contract by the two parties, but must not exceed a period of 3 months. The period of notice for employees, whose duties cover financial and accounting tasks, is 2 months, if the completion of those duties can not be accomplished within 30 days of the normal notice period. The notice period for fixed-term contracts is 3 months. Upon termination without observance of the notice period, redundancy money principally must be paid, covering loss of earnings during the regular notice period or compensating an actual claim. Additionally, payment limited to month's salary is due for certain grounds of dismissal. If a holiday entitlement still exists, which can not be taken anymore, this must be paid off in lieu.

Employer's social security contributions

At an average salary of EUR 500,00 per month on the basis of a contract of employment (not a service contract) the following burden emerges:

Model: Salaried employee born after 1959

National insurance 25%; employer's contribution 65%; employee's contribution 35%

  • Heath- and accident insurance 0,5%
  • Safety fund to the national insurance 0,5%
  • General health insurance 6%, the lots are allocated like the national insurance
  • Income tax according to graduated tax scale 

EUR 500,00 x 1,95583 (exchange rate) = Salary in Lewa BGN 977, 91
Social security contributions employer: 20,5% of gross salary = 977,91 x 20,5% = 200,47 BGN
The employer therefore pays a salary of BGN 977,91 + 200,47 = BGN 1178,38
Social security contribution employee: Flat approx. 13% of gross salary
BGN 977,91 x 13% = BGN 127,13

This part is deducted from the gross salary:

BGN 977,91 ./. 127,13 = BGN 850,78 and then taxed with 10% flat income tax: BGN 850,78 x 10% = 85,08 BGN
850,78 ./. 85,07 = 765,71 BGN  net amount

The national social security costs, borne by the employee, amount to approx. 13% flat and are deducted from the gross pay and on the remaining sum 10% income tax is calculated. The remaining sum is the net amount which the employee actually receives.

977,91 x 13% = 127,13 BGN
977,91 ./. 127,13 = 850,78 x 10% = 85,07(8)
850,78 ./. 85,07 = 765,71 BGN net amount

The national social security costs, borne by the employer, amount to approx. 20,5% and are calculated on basis of the gross salary and added to the gross amount at his cost or:

977,91 x 20,5% = 200,47

In total would be the monthly cost of an employer for one employee with a salary of EURO 500,00 approx. 977,91 + 200,47 = BGN 1178,38

Labour regulations for foreign workers

Foreign workers require a work permit issued by the national employment agency. There is a difference between a duration of employment up to 1 year and indefinite period. After issuance of a work permit, foreign employees enjoy equal rights vis-a-vis the Bulgarian employees.

Workers participation

Workers participation of blue collar and white collar workers like in continental Europe particularly in Germany, is unknown in Bulgaria. Irrespective of the trade unions, a general assembly of employees (Art 6 Labour Code) was instituted, simply facultative (optional), consisting of blue collar and white collar workers. The assignment of the general assembly is to represent the general interest of the workforce, like working conditions, remuneration, working hours, insurance, by elected representatives towards the employers and governmental institutions.

According to Art 7 Labour Code, employees only participate in designated statutory cases through their representative(s), at the deliberation and decision making process in questions about the management of the company.