Dimitrov Ivanov & Partners - Attorneys at law


July 30, 2010

Amendments of the Labour Code

New amendments to the Labour Code were promulgated in State Gazette today.

Most of the amendments are designed to modify the current regime of paid annual leave. The new amendments provide that the paid annual leave will be used in whole or in part according to a schedule approved by the employer for the year for which the leave is due. The above schedule will be elaborated by the employer in the beginning of each year, following consultancies with representatives of the trade unions and representatives of the employees.

The paid annual leave should be used until the end of the year for which it is due. If, within the period designated in the schedule, the employee uses other type of leave, he/she can use his/her paid annual leave at another time during the same year.

The employee is obliged to use its paid annual leave upon the sole discretion of the employer: (i) during a stay for more than 5 working days; (ii) if all employees simultaneously use their leave, as provided for in law, in collective labour agreement or in the internal labour regulations; (iii) if the employee has not requested to use its leave up to 5 working days as of the initial date of the period for leave, specified in the schedule.

The employer is obliged to permit the use of leave, requested by the employee, for the period specified in the above schedule, unless its use is postponed: (i) due to major production reasons (in such case the employer can postpone a part of the leave, i.e. not more than 10 days, to be used in the next year); or (ii) if the employee has used other type of leave (e.g. maternity leave, leave for birth and growing child, etc.), thus not being able to use its paid annual leave for the year for which it is due (in such case the paid annual leave is to be used in whole in the year in which the ground for postponing the use of paid annual leave has ceased to effect).

The employee is entitled to determine upon his/her own discretion the period for using paid annual leave, if the employer has failed to permit its use according to the above schedule. In such case the employee is obliged to duly notify the employer at least two weeks prior to the chosen period for using the leave.

The right of using paid annual leave is terminated upon the expiry of two years following the end of the year for which the leave is due, or two years following the year in which the ground for postponing the use of paid annual leave has ceased to effect.

As of 1 January 2011 upon termination of labour agreement the employee will have the right to a compensation for unpaid annual leave for the current year as per the days recognized for length of service, as well as for unused leave postponed on any of the above grounds, unless this right is terminated upon the expiry of the mentioned period of two years.

The paid annual leave accumulated from previous years and not used until 1 January 2010, can only be used until 31 December 2011.

Some of the amendments introduce novelties regarding the control for compliance of labour law. According to the amendments the employer is obliged to keep in the enterprise and in any of its working units a copy of the internal labour regulations, as well as any papers regarding working time regulations and organization of work, at disposal of the control bodies. In addition, the employer should appoint in writing persons to represent it before the control bodies of labour inspection.

The amounts of certain fines for non-compliance with labour regulations are also subject to changes.

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