Hiring guide in Bulgaria

What should I know about hiring in Bulgaria?

Legal framework

Types of employment contracts

There are two types of employment contracts in Bulgaria: indefinite contracts (open-ended) and fixed-term contracts. 

An employment contract is generally considered to be for an indefinite period unless stated otherwise. It can’t be converted into a fixed-term contract unless the worker or employee explicitly requests it in writing.

A fixed-term employment contract can be established under specific circumstances. These include a defined period not exceeding 3 years (unless otherwise specified by law or a government decree), the completion of a particular task, substituting for an absent employee, working in a position to be filled through a competitive examination, or for a role with a specific mandate as stipulated for the respective position.

Content of an employment contract

The employment contract must include the identification details of both parties. It must specify key elements such as the location or locations where the employee will perform their duties, including any provisions for remote work or travel. It should clearly outline the job title and the scope of responsibilities associated with the position. The contract must also specify when the contract is formalised and when the employee will begin their duties.

The contract should include detailed provisions regarding the allocation of basic and extended paid annual leave, as well as any additional agreed-upon leave. It must also outline the notice periods required from both parties in the event of termination, considering whether the contract is indefinite or fixed-term. 

The contract should explicitly state the base salary, any additional compensation such as bonuses or benefits, and the agreed-upon payment frequency (monthly or bi-weekly).

Download a free employment contract for Bulgaria through Native Teams.

Oral, written or electronic employment contracts

Employment contracts must be documented in writing, either with a traditional handwritten signature or a qualified electronic signature. In addition to documenting the contract, employers are responsible for notifying the relevant territorial directorate of the National Revenue Agency within specific time limits: within 3 days of signing or amending the contract and within 7 days of terminating it.

Working hours 

The standard workweek in Bulgaria is 40 hours, with each workday typically lasting 8 hours. Shift work is limited to a maximum of 12 hours. Various work time arrangements, such as flexible hours, open-ended schedules, shift work, part-time employment, on-duty assignments, and on-call responsibilities, can also be implemented.

Night work

Night work is limited to a maximum of 35 hours over a five-day workweek, with each night shift capped at 7 hours.

Certain groups of workers are prohibited from engaging in night work. These include Individuals under 18, Pregnant women, those undergoing advanced in vitro treatments, mothers of children under 6, or those caring for children with disabilities. 

Workers undergoing occupational rehabilitation, often referred to as “handicapped” employees, are restricted from night work unless they agree and health authorities confirm that it won’t harm their health. In addition, employees continuing their education while maintaining their employment are generally not permitted to work night shifts unless they consent to it.

Breaks and types of leaves

Employees are entitled to a lunch break that should last at least 30 minutes. Within a standard 5-day workweek, there’s also a daily rest period of 12 hours and a weekly rest period of 2 consecutive days (48 hours). 

However, an exception is allowed for the summarised calculation of working time, where the minimum weekly rest period can be reduced to 36 hours. In cases involving shift work with summarised time calculations, the rest period must be at least 24 hours.

Annual leave

According to the labour law, employees are entitled to a minimum of 20 working days of basic paid annual leave, with the possibility of extended leave as specified in individual employment contracts or collective agreements.

Employees starting their first job can use their paid annual leave after completing at least 8 months of service. Any unused paid leave can be carried over to subsequent years.

Public holidays

In Bulgaria, public holidays include several key dates throughout the year. January 1st is celebrated as New Year’s Day. On March 3rd, the country observes its National Holiday, marking Bulgaria’s liberation from the Ottoman Empire. May 1st is recognised as Labour and International Worker’s Solidarity Day, followed by Gergyovden (St. George’s Day) and the Bulgarian Army’s Day on May 6th.

May 24th is dedicated to Bulgarian Education and Culture and the Slavic Script Day. Unification Day is celebrated on September 6th, while Independence Day is observed on September 22nd. November 1st is the Day of the Bulgarian Enlighteners, a holiday recognised across all educational institutions.

Christmas celebrations span several days, with Christmas Eve on December 24th, Christmas Day on December 25th and the second Christmas Day on December 26th. The Easter Holidays, which include Good Friday, Holy Saturday, Easter Sunday, and Easter Monday, are observed for four days according to the Orthodox calendar each year.

Salary

As of 2024, Bulgaria’s minimum monthly wage is BGN 933, which is equivalent to EUR 477. Additionally, minimum wage levels can be negotiated and established through collective bargaining agreements. However, it is important to note that any provisions in these agreements that provide less favourable conditions to employees than those required by law or another binding collective agreement are deemed invalid.

To calculate the salary and taxes in Bulgaria, click here.

Sick leave

A medical certificate issued by a general practitioner or a medical consultation committee determines the start and duration of temporary incapacity to work. For the first 3 working days of sick leave, compensation is up to 70% of the employee’s gross daily pay for the month in which the incapacity occurs.

After this period, the daily sickness benefits are either 80% or 90% of the employee’s average gross daily pay or the average daily insurable income on which social security contributions have been made over the 18 months before the incapacity.

Parental leave

Once maternity, childbirth, or adoption leave has been exhausted, and if the child is not placed in a child-care facility, the mother is entitled to additional child-rearing leave until the child turns 2 years old.

This leave can be transferred to the father (or adoptive father) or one of the parents, provided they are employed with the mother’s consent. However, parental leave is primarily considered the mother’s right.

With the father’s approval, the leave can also be transferred to a grandparent, provided that the grandparent is employed and has made social security contributions for pregnancy and general illness for at least 12 months.

Paternity and maternity leave

Both employed and self-employed fathers are entitled to a 15-day paternity leave from the date the child is discharged from the hospital. With the mother’s consent, the father may use any remaining paternity leave, up to 410 days, after the child reaches six months of age.

Additionally, under certain conditions, fathers of children aged eight years or younger can take up to two months of additional leave. Financial compensation during paternity leave is 90 per cent of the average gross monthly earnings or the average insurance income from the last 24 months before the child’s birth.

Methods of employment termination

Both employees and employers can generally terminate an employment contract. The employer must provide a valid reason for ending the contract, and the employee has the right to contest the dismissal in court if they believe it is unjustified.

If this right is stipulated, either party can terminate the contract without giving notice during the trial period. An employee may terminate the contract without providing a reason but must adhere to the notice period specified by law or outlined in the employment contract.

Ordinary dismissal by the employer

An employer may terminate an employment contract under various valid circumstances. These include the need for contract termination due to changes in qualifications, the closing or partial closing of the enterprise, or staff reductions. 

Other valid reasons include decreased work volume, a work stoppage lasting more than 15 working days, or the employee’s lack of the necessary qualities for effective performance. Termination may also occur if the employee does not have the required education or vocational training, refuses to move with the enterprise to a different location, or if their position must be vacated to reinstate a previously unlawfully dismissed employee.

Termination is also applicable in specific cases for academic staff, such as professors, associate professors, and doctors of science, upon retirement age or qualifying for a pension, except in certain transitional provisions. 

Additionally, termination can occur if an employee has been granted a reduced insurance service and age pension, if employment relationships were established after acquiring pension rights, or if the employee no longer meets the job requirements due to changes in job criteria. Finally, an employment contract can be terminated if it becomes impossible to continue.

Notice period and challenging the dismissal

For ordinary dismissals, the notice period required for terminating an indefinite employment contract is 30 days, unless a longer period has been agreed upon by the parties, with a maximum of 3 months. In collective employment contracts, the notice period may be adjusted based on the employee’s length of service with the employer. 

There is no legally mandated notice period in cases of extraordinary dismissal. Moreover, the employment contract can be terminated during a probationary period without providing a notice period.

Rights and obligations of unemployed individuals

Individuals receiving unemployment insurance benefits are entitled to a standard rate of 60% of their contributory income, calculated as an average over the past 24 months. This ensures that the unemployment benefit provides financial support in line with the individual’s previous earnings. 

The minimum daily benefit is set at BGN 9.12 (EUR 4.6), which amounts to BGN 195 (EUR 99.7) per month, while the maximum daily benefit is capped at BGN 74.29 (EUR 37.8), totalling BGN 1,609.6 (EUR 823) per month.

Probationary period

The probationary period for employment cannot exceed 6 months. This period does not include any time the employee is on statutory leave or absent from work for other valid reasons.

If the employee fails to meet the position’s requirements during probation, this constitutes a valid reason for terminating the employment contract. The contract can be terminated by the employee at any time during the probationary period but must be done by the final day of the period.

Prohibition of competition 

Non-competition clauses can be included in employment contracts to prevent employees from sharing trade secrets or sensitive information with competitors.

According to the Labor Code, these clauses are restricted to a maximum duration of two years after the employment ends and require employers to compensate the employee for agreeing to this restriction.

Employees are prohibited from participating in business activities similar to those of their former employer, whether for personal benefit or on behalf of another entity unless they have explicit consent from the employer.

Remote working policy

Work from home can be arranged on a permanent, temporary, or occasional basis if both the employee and employer agree to this setup, provided that the nature of the work and the assessed low risk, according to occupational safety regulations, allow for it.

An employee working on-site may propose modifying their employment contract to include work-from-home arrangements for a specific period to better balance work, family, and personal needs. If remote work is initiated, the employer must create an addendum to the employment contract that outlines all specific terms, rights, and responsibilities for both parties.

Responsibilities within a remote work arrangement

Employees who work remotely must adhere to occupational health and safety regulations, allow the employer and relevant regulatory bodies to inspect the remote work location, and avoid engaging in activities that could disturb other property owners or occupants.

Remote workers can set their start and end times for work as long as they remain within the legal working hour limits.

Health and safety at home

Employers must legally provide their employees with safe and healthy working conditions. These conditions are designed to prevent occupational diseases and accidents, promoting the workforce’s overall physical, mental, and social well-being.

The law specifies minimum standards for various factors affecting workplace health, such as lighting, dust exposure limits, and the provision of specialised clothing for certain roles, including paramedical positions.

Intellectual property rights

The employee retains intellectual property (IP) rights to their publications, artworks, and similar creations made during their employment unless a different arrangement is specifically agreed upon with the employer.

This default position recognises the employee as the owner of the IP rights for these works. However, the employer is automatically granted an exclusive license to use these creations for business purposes.

Employee data privacy

The Bulgarian Personal Data Protection Act (PDPA) supplements and enforces the provisions of the GDPR within Bulgaria. This act specifies obligations and rights related to data protection and establishes the Commission for Personal Data Protection (CPDP) as the national data protection authority.

Employers must have a lawful basis for processing employee data, which may include fulfilling a contract, complying with legal obligations, obtaining consent, or pursuing legitimate interests, as long as these do not infringe on the employee’s rights and freedoms.

What are the advantages of hiring employees from Bulgaria vs other countries?

Hiring employees from Bulgaria offers several distinct advantages that can benefit businesses, particularly those looking to optimise costs while maintaining access to a highly skilled workforce.

Positioned at the crossroads of Europe and Asia, Bulgaria offers easy access to major European markets and serves as a gateway to the Middle East and Asia. The country’s location also provides a favourable time zone that overlaps with many European countries.

Another benefit is that Bulgarian professionals are often well-versed in Western business practices and culture, further enhancing their compatibility with multinational teams.

Why use Native Teams for hiring in Bulgaria?

Native Teams lets you employ team members ‘like a local’ meaning you get all the benefits of a global team, wherever you are based. Here are the reasons why you should use Native Teams for hiring:

• No paperwork: We will handle all the necessary paperwork for you.
• Save on taxes: We help you handle your taxes.
• No company set up: You can expand your business using our company entitles.
• Online onboarding: We’re here to ensure your onboarding process is trouble-free.
• No accounting: We will handle all of your accounting needs, including invoicing, payroll, and more.
• Increase your profit: We assist you in growing your business and maximizing your profits.
• Compliance expertise: we can assist your company in navigating the regulatory environments and ensure you meet all relevant requirements.
• Local support: We can assist you in understanding and complying with the relevant local laws.