On 30.03.2020 the Bulgarian Government adopted a Decree
laying down the conditions and procedure for the payment of compensation to
employers in order to preserve the employment in a state of emergency due to
corona-virus situation.
The amount of the compensation is 60 percent of the
insurance income for the month of January 2020 for each person to whom the
regime of termination of employment or part-time work is applied. For the part-time
work, the compensation shall be paid in proportion to the time worked, but not
more than four hours.
Employers will be able to receive the funds provided they
retain the employees for a period not less than the period for which they
receive compensation. During this period, they will have to pay the full amount
of the persons' wages for the respective month and the tax and social
insurances due.
Compensation will be paid when work is suspended for the
whole or part of the period of emergency, but for no more than 3 months.
Employers may apply for compensation, which:
- are local physical or legal persons, as well as foreign legal entities,
operating in Bulgaria;
- have
no liabilities to the state
or municipality for taxes and compulsory social security contributions (within
the meaning of Art. 162, para. 2, item 1 of Tax and Social Insurance Procedure
Code);
- are not in bankruptcy or liquidation proceedings;
- will keep the employment of compensated persons for
a period not less than the period for which the compensation was paid;
- will not terminate employment contracts on the
grounds: a) closure of part of the enterprise or redundancy; b) reducing
workload; c) stopping work for more than 15 working days, for the period the
compensation is paid;
- do
not have a decree or judgment established by an enforced law of Labor Cod within the last 6
months.
Compensation may be paid to an employer who, due to the
state of emergency:
- by his order issued on the basis of an order of
a state body, terminated the work of the enterprise, part of the enterprise or individual
employees. In this case the business activity of the entity must be within the following business activities: accommodations,
restaurants & bars, cultural, sports and entertainment activities, retail, logistic
& transport.
- Employers from all sectors of the
Classification of Economic Activities (NACE.BG-2008), with the
exception of Sectors: Agriculture, forestry and fisheries, Financial and
insurance activities, Government, Education, Human health and social work,
Household activities as employers, Undifferentiated household activities for
the production of goods and services for own consumption, Activities of
extraterritorial organizations and services, may apply for compensation, which also meet the following conditions:
- by its order issued on the grounds of art. 120c,
para. 1 of the Labor Code, has suspended the work of the enterprise, part of
the enterprise or individual employees in the event that OR
- by its order issued on the grounds of art. 138a,
para. 2 of the Labor Code, has established part-time work in the enterprise or
in its unit;
- declare a decrease in sales revenue as follows:
- not less than 20% in the month preceding the
month of application for payment of compensation, compared to the same month of
the previous calendar year - for entities, established before March 1, 2019;
- not less than 20% in the month preceding the
month of application for payment of compensation, compared to the average
income for the month of January and February 2020 - for entities established
after 1 March 2019
The employer submits, including electronically, to the Labor
Office Directorate, related to legal address of the employer, application for
payment of compensation in accordance with a form approved by the Executive
Director of the Employment Agency.
Within 7 working days the Employment Agency will announce
the approved applications.
This material and information are for general information purposes only. Making any business, legal or other decisions needs additional professional advice. If you have any additional questions, please
contact us.
31.03.20
