European Trade Union Institute, ETUI.

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Labour market reforms in Bulgaria - background summary

Since 2011, the labour market policy of the various Bulgarian governments has concentrated on a number of key areas, such as flexibilisation, representation of the social partners’ organisations and training. However, those reforms could be qualified as relatively modest and minor.

Flexibilisation

  • Different measures were introduced to labour legislation during the last 3-4 years in order to introduce greater flexibility to some aspects of work and to combat undeclared work.
  • In 2015, one of the most discussed changes in Bulgaria was the introduction of the new option for employers to stipulate flexible working hours. According to the new paragraph 3 of Art. 139 LC, if an employee/worker works less than the normal daily working hours on one day, they may work longer than the mandatory working hours on another later day in order to make up for the hours lost. Until now, such flexibility was achieved by introducing the so-called summarised calculation of working time Art. 142 (2) LC. In view of the fact that the reporting of working hours depends on the regulations in a company's internal labour policy, these regulations will now have to include flexible working time limits in accordance with the new rules.
  • Amendments and supplements to the LC in 2016 introduced new grounds for dismissal, namely eligibility for reduced pension (Art. 68a, Social Security Code, SSC) if the employment came about after the employee received a reduced pension on reaching retirement age (Art. 68a of SSC).
  • CL Podkrepa criticises this amendment stating that “the pension right becomes an obligation” and declares that it is questionable how far this will achieve the goal of providing jobs for young people to replace those who have retired. In addition, the decrease in average effective retirement age will be detrimental to the pension system as a whole.
  • Changes to the LC in 2014 introduced new, separate grounds for a contract of employment for internships which came into effect as from March 2015. Art. 233a of the LC provides the legal definition of an internship as on-the-job training that entails working under the guidance of the employer or an appointed mentor in order to acquire the practical skills of the trade or vocation. The grounds for concluding such agreements are provided in Art. 233b of the LC which specifies the necessary legal requirements for such an internship. The following conditions must be fulfilled simultaneously in order to conclude an employment contract for an internship: the intern must have completed secondary or higher education with a trade or vocation; the position and work to be performed by the intern during the internship must correspond with his/her qualifications; the intern should not have acquired any previous work experience and worked for other employers in the trade or vocation for which the internship is agreed; contracts of employment for internships may be concluded only with persons under the age of 29.
  • Internship contracts may be concluded for at least six months and not more than 12 months. Internship contracts may be terminated by either party with 15 days' notice. Another important point is that the termination of a contract of internship is not covered by the protection against dismissal regulations under Art. 333 of the Labour Code. The internship contract is an employment contract so that the National Revenue Agency (NRA) must be notified accordingly. For this purpose, some amendments were made to Ordinance №5 with regard to the content and procedure for submitting notification under Art. 62, para. 5 of the Labour Code. A new code (16) has been added as grounds for concluding the employment contract, which applies specifically to contracts for an internship.
  • One-day employment contracts - The amendments to the Labour Code (LC) (adopted by parliament on 2 July 2015) introduced one-day contracts for the first time (Art. 114a LC). The scope of this provision is limited. One-day contracts may only be concluded for activities in the agriculture sector for harvesting fruit, vegetables and roses in jobs that require no special training of employees and workers. Such a contract can be concluded only between a worker and a registered agricultural producer. Any person will be able to conclude such contracts, whose total length must not exceed 90 days within one calendar year. An important feature of such contracts in terms of social insurance issues is that workers will be insured only for disabilities arising from sickness, old age and death, or occupational accidents and diseases. Furthermore, the time spent in employment under such contracts is not recognised as length of service.
  • According to the government, the one-day labour contracts are expected to increase the revenues of the State Social Security Budget (SSSB) by up to BGN 19.2 million (EUR 9.84 million), as well as BGN 5.3 million (EUR 2.71 million) in revenues from taxes on personal income. The General Labour Inspectorate (GLI) registered 67,539 of these new contracts in the two-month period after the amendments of the LC came into force.

Representation of social partners

  • The new census of the membership of employer representatives and trade unions involved in NCTC began at the end of January 2016. With amendments to the Labour Code, parliament adopted new, lower criteria for representation of the social partners, approved by the social partners (the previous changes to the Bulgarian Labour Code were made in January 2012, introducing stricter criteria for the social partners acting as national representatives on the tripartite consultative council – ETUI 2013).The trade unions represented on a national scale will be recognized if they have at least 50,000 members (compared to the previous requirement for 75,000 members). Employers’ organisations must have at least 1,500 members, and not less than 50,000 employees in all members or at least 100,000 employees under employment contract, in order to be recognised as representative employers’ organisation on a national level. All these amendments are supported by the current social partner representatives.

Training

  • In 2014 legislative changes introduced dual vocational training in Bulgaria. Dual education enables pupils to learn a job by completing an apprenticeship, which combines theory with vocational training, so that young people can earn money for their work. Employers will have their say with regard to the training timetable. According to the ministry of education, these measures should reduce the number of pupils who drop out of school for socioeconomic reasons. This system was firstly implemented in 2015. However, the extent to which it is implemented depends on whether the vocational training colleges succeed in signing contracts with corresponding companies.
  • On 15 September 2015, the first dual training courses in Bulgaria began at two vocational training colleges - Vocational Training College of Food Technology "Prof. Dr. Georgi Pavlov" in Sofia and Vocational Training College "Ivan Hadzhienov" in Kazanlak, based on experience gained in Switzerland. This project pursues the development of a sustainable Bulgarian system where the vocational education provided at the colleges is closely linked to the demands of the workplace. In 2016-2017, dual vocational training will be offered in 19 new colleges.
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