Updated last 26.03.2021
- The work provided by an employee is to be compensated. Remuneration represents the cash payment by the employer to the employee for the provided work-related activities.
- All occupations and positions in Bulgaria are listed and categorised in the National Classification of Occupations and Positions 2011 – NCOP-2011, which ensures the application of the International Standard Classification of Occupations. The NCOP categorizes the positions into 9 classes, depending on the education and qualifications required for the specific position. Class I positions require the highest educational level and should have the highest pay, and Class IX – the lowest educational level and therefore should have the lowest pay.
Minimum salary and minimum insurance income
- A minimum gross monthly salary has been set in order to protect employees whose jobs require minimal qualifications/ skills. Currently, it amounts to BGN 650. This means that by law, a gross monthly salary below this amount cannot be agreed by an employer and an employee (assuming normal work during normal working hours).
- In order to protect the employees, the law has also introduced minimum insurance income by main economic activities and qualification groups, which obliges the employer to pay social security contributions on income in amount of not less than the minimum insurance income for the respective occupation. A complete list of the positions and the minimum insurance income levels is available in Appendix No 1 to LBSSS: Minimum social security income by main economic activities and occupationqualification groups – 2019.
Elements of the remuneration
- Base pay amount: Remuneration due by the employer to the employee for the execution of the agreed work within normal working hours and working conditions. The base pay amount is set per month for normal duration of the working hours (i.e. 8 hours) and full-time employment during the month.
- Additional compensation may be paid to the employee for additional merits of the service performed or for services provided in conditions deviating from the normal ones. Additional compensation may be due as required by a specific ordinance or regulation, or it may be agreed between the parties in an individual and / or collective labour agreement; it may be provided in cash or in kind. The most common types of additional compensation include:
– Additional compensation for length of service and professional experience – the increase is of minimum rate of 0.6 % of the base pay salary, but a higher percentage may be agreed between the parties in the employment contract or may be set by the employer in the “Internal Rules on Remuneration“.
– Additional compensation for higher scientific qualification – paid to employees who have hold high-degree diplomas when and while performing scientific work and while teaching, or working in their specialty. The minimum monthly compensation ranges between BGN 15 and BGN 50, depending on the specific “PhD” acquired.
– Additional remuneration for night-time work – the night-time work is paid additionally to the wage, and it shall be in the minimum rate of 0.15 % of the minimum wage adopted for the country, but not less than BGN 1 for each night-time hour worked or for a part thereof. The hours between 22:00 and 06:00 o’clock are considered as night-time working hours.
– Overtime – additional pay due, based on the following minimum requirements:
- Overtime during work days – additional 50% of remuneration agreed in the employment contract;
- Overtime during the days of weekly rest (i.e. weekends) – additional 75%;
- Overtime during official holiday – additional 100%.
– Additional compensation for work during official holidays – additional pay at least double the amount of the remuneration agreed in the employment contract.
– For the time during which the employee is available to the employer and is outside the territory of the company at a location agreed between the two parties – additional pay of BGN 0.10 is due for every hour or portion thereof.
- By virtue of a collective labour agreement, “Internal Rules on Remuneration” and / or individual employment contract, additional compensation may be agreed for:
– Achieving specific results – for the year or for another period of time;
– Temporary changes in the working conditions that lead to additional strain for employees’ health;
– Profit sharing, etc.
- During a stand-down and idle time due to no fault of the worker or employee, including in case of suspending the work as a result of emergencies or extraordinary epidemiological situation, the worker / employee shall be entitled to her/his gross wage.
Payment of remuneration
- The payment of the remuneration is a fundamental duty of the employer.
- The basic wage is paid in cash (the additional work remuneration could be also paid in kind, if such option is provided in an act of the Council of Ministers, collective employment contract or the worker’s individual employment contract);
- The frequency of payment of the remuneration is agreed between the employee and the employer in the employment contract. If otherwise is not agreed upon, the remuneration is paid twice monthly (and advance and a final payment);
- The remuneration is paid personally to the employee. By exception, the remuneration may be paid to another individual in which case the employee should provide a written request to the employer. The persons who have the right to receive the remuneration include only close relatives of the employee.
Internal Rules on Remuneration
The organisation of the remuneration in a company should be set out in an internal document titled “Internal Rules on Remuneration”. The content of the document is stipulated in the Labour Code, the Ordinance on Negotiating Salaries and the Ordinance on the Structure and Organisation of the Salaries.
Required content of the Internal Rules on Remuneration:
- General provisions for the organisation of employees’ salaries;
- Budgeting and allocation of the funds for salaries;
- Setting minimum amounts or ranges for base pay by levels of positions;
- Methodology for setting, distributing and changing additional compensation (including benefits).
Additional content of the Internal Rules on Remuneration:
- Methodology for the evaluation of jobs and positions;
- Grouping of the positions by level and qualification required (i.e. grading system);
- Rules and procedures for the basic wage’s determination and change;
- Rules and procedures for performance assessment and management, etc.