Hiring Employees and Employment Law in Bulgaria

Introduction

Bulgaria’s labour market is one of the country’s most significant competitive advantages for foreign employers. A workforce of approximately 3 million active workers — large by the standards of a 6 million population country — offers a multilingual, technically educated talent pool at salary levels 40–60% below Western European equivalents. The country’s IT and BPO sectors, with over 130,000 people employed between them, have demonstrated that Bulgarian professionals can perform complex, high-value work to international standards.

With Bulgaria’s adoption of the euro in January 2026 and its full Schengen membership since 2024, the employment framework has become more straightforward for internationally managed companies: all salary payments, social contributions, and employment-related taxes are now denominated in euros, eliminating currency conversion complexity for companies managing payroll across multiple European entities.

Bulgarian employment law is governed primarily by the Labour Code (Кодекс на труда), which is substantially aligned with EU employment directives. It provides strong worker protections — mandatory written contracts, minimum leave entitlements, sick pay obligations, and procedural requirements for termination — while remaining commercially workable for employers who understand the system. This guide covers every aspect a foreign employer needs to know to hire legally and efficiently in Bulgaria.

Why International Companies Hire in Bulgaria

The decision to hire in Bulgaria rather than in Western Europe or in a higher-cost neighbouring country comes down to a combination of factors that compound: lower salaries, lower social contribution rates, lower office costs, and a lower corporate income tax on the profits generated by that workforce.

Who Can Work in Bulgaria

EU and EEA Citizens

Citizens of EU and EEA (European Economic Area) member states have the right to work in Bulgaria without restriction and without a work permit. This right follows directly from the EU principle of free movement of workers. An EU or EEA citizen who accepts employment with a Bulgarian company simply needs to register their presence in Bulgaria with the local municipality if they intend to reside there for more than three months. No additional authorisation from any employment authority is required.

This applies to citizens of all 27 EU member states plus Norway, Iceland, and Liechtenstein. Swiss nationals benefit from a separate bilateral agreement providing equivalent rights.

Third-Country Nationals — Non-EU Citizens

Citizens of countries outside the EU/EEA require a work permit to be employed legally in Bulgaria. The specific permit type depends on the nature of the employment, the qualifications of the individual, and the duration of the role.

Types of Employment Contract

All employment relationships in Bulgaria must be governed by a written employment contract. An oral agreement is not legally sufficient — the Labour Code requires a written contract to be concluded and provided to the employee before the first day of work. Failure to provide a written contract exposes the employer to significant fines from the Labour Inspectorate.

Indefinite-Term Contract (Безсрочен трудов договор)

The indefinite-term (open-ended) contract is the standard and most common form of employment agreement in Bulgaria. It does not have a fixed end date and continues until terminated by either party in accordance with the Labour Code. Bulgarian law provides strong protections for employees on indefinite-term contracts, particularly regarding termination procedures and notice periods. This is the appropriate form for all permanent staff.

Fixed-Term Contract (Срочен трудов договор)

A fixed-term contract is permitted only in specific circumstances defined by the Labour Code. The main permitted grounds are:

• Temporary replacement of an absent employee — most commonly used for maternity/parental leave cover
• Completion of a specific project or task with a defined end point
• Seasonal work in agriculture, tourism, or other seasonal industries
• Temporary or occasional work not connected to the company’s regular activity

A fixed-term contract may not be used simply as a method of avoiding the protections of an indefinite contract for regular work. Bulgarian courts will treat an improperly justified fixed-term contract as an indefinite contract if challenged. The maximum duration of a fixed-term contract for most purposes is 3 years; repeated back-to-back fixed-term contracts for the same role are restricted and can be converted to indefinite contracts by court order.

Probation Period (Изпитателен срок)

Both indefinite and fixed-term employment contracts may include a probation period. During the probation period, either party may terminate the contract without stating reasons and without a notice period (unless the contract specifies otherwise). The maximum probation period under Bulgarian law is:

• 6 months for indefinite-term contracts
• Up to the length of the contract, but not exceeding 1 month, for fixed-term contracts of up to 1 year

The probation period must be explicitly stated in the contract. If not mentioned, the employment begins without probation. The party in whose favour the probation is set (employer or employee) must be specified in the contract; if not specified, it is deemed to be in favour of both parties.

Mandatory Terms of the Employment Contract

The Bulgarian Labour Code specifies the minimum mandatory content of every employment contract. All of the following must be included in writing. Additional terms may be agreed by the parties provided they do not fall below the statutory minimums.

Minimum Wage and Typical Salary Levels in 2026

Statutory Minimum Wage

From 1 January 2026, following Bulgaria’s adoption of the euro, the statutory minimum gross wage is approximately €620 per month for a standard full-time 40-hour week. This is the legal floor below which no adult employee in any sector may be paid, regardless of the nature of their work.

The minimum wage is reviewed periodically by the Council of Ministers in consultation with social partners (employers’ associations and trade unions). Bulgaria’s minimum wage has increased consistently over the past decade as the country has converged towards EU norms, and further increases are expected through 2030.

Typical Gross Salary Levels by Sector (2026)

The minimum wage represents only the legal floor. Actual market salaries vary significantly by sector, seniority, and city. The following ranges represent typical gross salaries for experienced professionals in Bulgaria’s main employment sectors.

The True Cost of an Employee to the Employer

The gross salary stated in the employment contract is not the total cost of employment. Employers in Bulgaria must pay mandatory social and health insurance contributions on top of the gross salary. These employer contributions are not deducted from the employee’s salary — they are an additional cost paid directly by the employer to the NRA.

Employer Social Contributions (2026)

Full Cost Model — Employee on €1,500 Gross Salary

The following breakdown shows the complete picture: what the employer pays, what the employee receives, and what is withheld and remitted to the state.

Full Cost Model — Employee on €3,000 Gross Salary

Working Time, Overtime, and Public Holidays

Standard Working Hours

The standard working time in Bulgaria is 8 hours per day and 40 hours per week, distributed over 5 working days. Alternative arrangements (compressed working week, flexible hours, shift work) are permissible but must be agreed in the employment contract or company work rules and must comply with the Labour Code’s provisions on maximum daily and weekly working time.

Part-time employment is fully permitted. A part-time employee has the same rights as a full-time employee on a pro-rata basis — the same minimum wage per hour, the same leave entitlements proportionally, and the same social contribution obligations.

Overtime

Overtime in Bulgaria is strictly regulated. Employees may not be required to work more than 150 hours of overtime per calendar year, and certain categories (pregnant women, employees with young children, disabled employees) may not be required to work overtime at all without their explicit consent.

Public Holidays

Bulgaria has 15 official public holidays per year on which employees are entitled to rest with full pay. When a public holiday falls on a Saturday or Sunday, the following Monday (and sometimes Tuesday) is typically declared a compensatory day off by government decree. Employers must pay the double rate (100% premium) if an employee works on a public holiday.

• 1 January — New Year’s Day
• 3 March — National Day (Liberation from Ottoman rule)
• Good Friday, Holy Saturday, Easter Sunday and Monday (moveable)
• 1 May — Labour Day
• 6 May — St. George’s Day (Bulgarian Armed Forces Day)
• 24 May — Education and Culture Day (Bulgarian Alphabet Day)
• 6 September — Unification Day
• 22 September — Independence Day
• 1 November — National Awakening Day
• 24, 25, 26 December — Christmas (3 days)

Annual Leave and Other Statutory Leave

Paid Annual Leave

Every employee in Bulgaria is entitled to a minimum of 20 working days of paid annual leave per year. This minimum applies regardless of contract type, sector, or working pattern (subject to pro-rata calculation for part-time employees). The 20-day minimum is a legal floor — employers may provide more, and many do for senior or specialist positions, but none may provide less.

Annual leave is accrued from the date of commencement of employment. In the first calendar year, leave accrues at the rate of 1.67 days per month of completed service. From the second year, the full 20-day entitlement applies at the beginning of the calendar year. Unused leave may be carried forward, but employees must take at least half of their annual entitlement in the calendar year it accrues.

Sick Leave, Maternity Leave, and Social Benefits

Sick Leave (Временна неработоспособност)

When an employee is temporarily unable to work due to illness, the Bulgarian system provides a combination of employer-funded and state-funded sick pay. The employee must provide a medical certificate (болничен лист) issued by a licensed Bulgarian physician to activate sick pay.

Maternity and Parental Leave

Bulgaria provides one of the most generous maternity and parental leave systems in the European Union. The system is funded through the National Social Insurance (НОИ), not the employer — the employer’s direct cost is limited to the first three days of sick leave if the employee is ill before delivery, and the administrative obligation of managing the leave period.

• Pregnancy and childbirth leave: 410 days (approximately 13.5 months) in total, of which 45 days are taken before the expected due date and the remaining 365 days after delivery. Benefit is paid at 90% of the average insured income.
• Parental leave until the child reaches 2 years: Following the 410-day maternity leave, one parent (mother or father) may take parental leave until the child’s second birthday. The benefit during this period is a fixed monthly amount set by law (approximately BGN 780/month — ~€399 in 2026).
• Paternity leave: 15 days of paid paternity leave for the father, payable by the NОИ at 90% of insured income.

The total combination of pregnancy leave, maternity/parental benefit, and reduced parental leave creates a period of up to approximately 3 years during which an employee may be away from work on state-funded benefits. The employer must keep the position open and reinstate the employee at the same or equivalent role.

Termination of Employment

Bulgarian employment law provides strong protections for employees against arbitrary dismissal. Employers must follow prescribed procedures for any termination initiated by the employer — failure to follow these procedures, even for a valid substantive reason, can result in the termination being declared unlawful by a court, with reinstatement and back-pay as the remedy.

Grounds for Employer-Initiated Termination

Notice Periods

The standard minimum notice period for termination of an indefinite employment contract is 30 calendar days for both the employer and the employee, unless the contract or a collective agreement provides for a longer period (up to a maximum of 3 months). Fixed-term contracts that are terminated before their natural expiry follow specific rules depending on the reason.

During the notice period, the employee continues to work and is entitled to full pay, benefits, and leave accrual. The employer may pay the employee in lieu of notice (изплащане вместо предизвестие) to end the relationship immediately.

Protected Categories — Prior Permission Required

Certain categories of employee may not be dismissed by the employer without prior written permission from the Labour Inspectorate. Attempting to dismiss a protected employee without this permission renders the termination automatically unlawful, regardless of the reason. Protected categories include:

• Pregnant employees and employees on maternity or parental leave
• Employees who have initiated pregnancy through IVF treatment
• Employees undergoing rehabilitation following a work accident
• Employees elected as trade union representatives (for the duration of their mandate)
• Employees on sick leave at the time the termination notice is served

Remote and Hybrid Working Arrangements

Remote work (дистанционна работа) became widespread following the COVID-19 pandemic and is now a standard feature of Bulgarian employment in the IT, BPO, and professional services sectors. Bulgarian employment law recognises and regulates remote work, and specific requirements must be met to ensure compliance.

Legal Requirements for Remote Work

• Written agreement: Remote work must be agreed in writing — either in the original employment contract or through a written amendment to an existing contract
• Place of work: The specific location where the employee works remotely (typically the home address) must be specified in the contract
• Equipment: The contract must specify whether the employer or employee provides the equipment; if employer-provided, ownership and return obligations must be addressed
• Data protection: Remote workers handling personal data must comply with GDPR requirements; the employer must implement appropriate technical and organisational measures
• Health and safety: The employer’s health and safety obligations extend to the remote workplace; the employee must declare that the remote work location meets the required conditions
• Connectivity and communication: The contract should specify expected availability hours, response times, and communication tools

Hybrid Working

Many Bulgarian employers use a hybrid model: employees work from the company office for a defined number of days per week and remotely for the remainder. This requires a contract that specifies both locations (office address and home address) and the expected distribution of working days. The same health and safety and data protection obligations apply to the remote component.

Where to Find Employees in Bulgaria

Bulgaria has a well-developed set of recruitment channels across different professional segments. The right channel depends on the type of role, seniority level, and how quickly the position needs to be filled.

Common Mistakes Foreign Employers Make in Bulgaria

Using Civil Law Contracts (Граждански договор) Instead of Employment Contracts

One of the most frequent and most penalised violations by the Labour Inspectorate is engaging individuals who perform regular, ongoing work under civil law service contracts (similar to freelance or contractor agreements) rather than employment contracts. If the work is regular, performed at the employer’s premises or under the employer’s direction, and constitutes the person’s primary source of income, Bulgarian law deems it an employment relationship regardless of what the contract says. Penalties for undeclared employment are severe: fines of BGN 1,500–15,000 per undeclared employee, plus backdated social contributions.

Failing to Register Employment Contracts with the NRA

Every employment contract must be electronically registered with the NRA at least 3 days before the employee’s first working day. This is not a formality — inspectors check compliance and fines are routinely imposed. Bulgaria For Business files all NRA employment notifications for payroll clients as a standard service.

Underestimating the True Cost of Employment

Many foreign employers budget only the gross salary without accounting for the ~19% employer social contributions on top. For a team of 10 employees, this omission understates the annual payroll budget by approximately €45,000–80,000 depending on salary levels. Payroll modelling before hiring is essential.

Ignoring Health and Safety Obligations

Bulgarian employers are legally required to conduct a workplace risk assessment, implement health and safety measures, provide mandatory initial health and safety training to new employees, and keep specific documentation. For office environments, the requirements are manageable but must be met. For manufacturing, construction, or chemical environments, the obligations are significantly more demanding.

Incorrect Termination Procedures

Dismissing an employee for valid reasons but without following the correct procedural steps (written notice, time for response, written dismissal order, calculation and payment of severance) is the most common source of labour disputes. Bulgarian employment courts are generally employee-friendly. Getting the procedure right from the beginning is always less expensive than defending a wrongful dismissal claim.

Not Having an Internal Company Work Rules Document

Bulgarian employers are required to maintain an Internal Company Work Rules document (Правилник за вътрешния трудов ред) that specifies working hours, break schedules, disciplinary procedures, leave approval processes, and health and safety rules. This document must be posted in the workplace and provided to each employee. Its absence is a compliance violation and weakens the employer’s position in any disciplinary or termination dispute.