AMENDMENTS TO THE BULGARIAN LABOUR CODE
New Obligations of Employers Adopted
(State Gazette № 120 of 29.12.2002)

The latest amendments to the labour laws affected mainly the legal framework of the employment contract. The employment contract is the most commonly used and the most important source of employment relationships. Alongside with this, since 1990 in Bulgaria the practice of employing people without making a contract in writing subject to the provisions of the law has been widely spread. The legislature through a series of amendments to the Labour Code (LC) was making continuous efforts to eliminate the said practice, and through one set of amendments (State Gazette № 2 of 05.01.1996) established a provision, by virtue of which valid employment relationship was formed even in the absence of a contract in writing in case the employer had admitted the employee to work and the latter had started performance.

In the present amendments and supplements to the LC the legislature`s approach is different.While the form in writing remains the only valid form of employment contracts, the provision of Article 62 (2) of the LC, which proclaimed an employment relationship to be formed validly in the absence of a contract in writing under the said conditions, was repealed. The law specifies that an employment contract must be concluded between an employer and an employee before the employee undertakes the job. Requirements for the registration of employment contracts were established under which the employer is obliged to notify the regional department of the National Social Insurance Institute (NSII) within three days following the making of, or the amendment to, and within seven days following the termination of an employment contract. A copy of the notification certified by the regional department of NSII, as well as a copy of the employment contract, must to be delivered to the emlpoyee by the moment of his/her undertaking of the job. The expectations are that those amendments to the law should facilitate and improve the control over compliance with labour and social insurance laws.

The obligations of employers for registration of employment contracts concluded with employees were specified in Regulation № 5 of 29th December 2002 adopted by the Ministry of Labour and Social Policy (State Gazette № 1 of 2003). According to the Regulation notification of the regional department of NSII must be made through one of the following three methods : submitting it in person in the regional division of NSII; registered mail; or the Internet, provided that the employer is in possession of certificate of universal electronic signature.* As far as the obligation for registration of amendments to employment contracts is concerned, the Regulation specifies that subject to registration are only amendments (i) changing the position of the employee, or (ii) the term of the contract, but not amendments concerning other contractual terms and conditions. Subject to registration is also the issuance of an order under Article 405a of the LC by virtue of which the labour inspection authorities are competent to construe an employment relationship where a job is being performed in the absence of an employment contract. The order of the labour inspection authorities replaces the contract in writing in case the employer failed to execute such a contract in writing after being ordered to do so. The employer is obliged to notify the social insurance authorities under the above procedure in case the employee has not undertaken the job within the agreed time limit (seven days unless otherwise stipulated), as well as in case of bringing back to office of a wrongfully dismissed employee.

Employers are obliged to register until 30th April 2003 all employment contracts existing by 2nd January 2003, even if terminated before the sending of notification. In case employers have employed persons under the repealed Para. 2 of Article 62 of the LC same employers must shape their employment relationships in writing and must notify the NSII by 30th April 2003.

Under the rules of conflict of laws concerning employment relationships, the obligations in connection with registration of employment contracts are imposed upon Bulgarian and foreign employers in Bulgaria, as well as upon Bulgarian employers located abroad which employ Bulgarian citizens.

In case of failure to comply with the provisions of the labour laws on the making of the employment contracts in writing and on the required notification of the social insurance authorities employers are imposed fines in the amount of 1000 BGL for each separate case of non-compliance.

* The certificate in question is issued subject to the Electronic Document and Electronic Signature Act