Bulgaria Employment Guide

Navigating Employment Termination in Bulgaria: A Professional Guide

Terminating employment relationships in Bulgaria requires strict adherence to complex legal frameworks and country-specific regulations. The separation process must be carefully managed by employers in collaboration with key stakeholders, often involving specific procedures and potential financial obligations depending on the termination circumstances.

Legal Grounds for Employment Termination

Bulgarian labor law does not recognize at-will employment, meaning employers cannot terminate contracts without valid justification. The legally acceptable termination methods include:

• Voluntary resignation by the employee
• Mutual agreement between both parties
• Employer-initiated termination based on:
  • Probation period assessment
  • Disciplinary dismissal
  • Business closure
  • Workforce reduction
• Contract expiration

Upon termination, employers must compensate for any unused vacation days, outstanding commissions, or unpaid bonuses.

Notice Period Requirements

The statutory notice period ranges from a minimum of 30 days to a maximum of 90 days, applicable to both employers and employees initiating termination.

Severance Pay Obligations

Bulgarian legislation mandates severance payments in various termination scenarios:

• Business closure or workforce reduction: One month's severance pay
• Termination due to health issues or occupational risks after five years of service: Two months' severance
• Retirement age termination:
  • Less than 10 years of service: Three months' severance
  • 10+ years of service: Six months' severance
• Mutual agreement termination with employer initiative: Minimum four months' severance
• Termination without proper notice: Three months' severance

For instance, when a manufacturing company recently downsized its Bulgarian operations, SailGlobal's pre-calculated severance provisions ensured compliance with local requirements while minimizing financial surprises.

Risk Management Strategy

To protect against unexpected termination liabilities, SailGlobal implements severance accruals for all Bulgarian employment agreements. Our global expertise in litigation risk management ensures calculations align with statutory requirements and local best practices. Should employees resign or not qualify for severance, any unused accruals are returned to the client.

Consider the case of a technology firm that avoided significant penalties by following SailGlobal's structured termination framework, which included proper documentation and timely severance payments.