In order to provide additional protection for employees against delayed remuneration, the Bulgarian legislature has amended the Civil Procedure Code, Commercial Code, Guaranteed Workers and Employees Claims Act (in case of employer bankruptcy), and the Public Procurement Act.
A business may be transferred to a new buyer only after the owner has paid all outstanding salaries and wages, indemnities, and statutory social-security contributions to employees, including those who left the company up to three years prior to the transfer. In principle, the previous employer must make the payments, but if agreed upon, the buyer of the company can also be responsible for the delayed payables.
The same requirement applies to the transfer of shares to a new shareholder, which is only possible if there are no outstanding payables, indemnities, and social-security contributions to employees, including those who left over the last three years.
Furthermore, the oversight authority, the Executive Labor Inspectorate, has been expanded, not only to check on the payment of wages and salaries to employees and former employees, but also to request insolvency proceedings for companies that have not paid at least one third of their staff for more than two months.
A trustee will accept receivables ex officio for an employee (included on a list of accepted receivables), even if the employee’s work relationship was terminated six months prior to an insolvency filing in the Commercial Register. According to the previous law, workers' claims are only entered ex officio on an accepted-receivables list if they were employed at the time proceedings were opened.
In addition, the Public Procurement Act introduces a limitation, whereby employers who owe remuneration and compensation to employees may be prevented from participating as contractors or subcontractors in a public procurement procedure. The labor inspectorate or a court decision would make such a ruling.
Lastly, the Guaranteed Workers and Employees Claims Act entitles employees to a guaranteed claim who are or have been employed by an enterprise currently facing insolvency proceedings. These claims apply even if the employers terminated these contracts prior to the proceedings. Guaranteed claims include six months of accrued unpaid wages and benefits over three calendar years before the decision was made (the previous law applied to only one calendar year).