Employer of Record in Bulgaria

An Employer of Record (EOR) in Bulgaria is a company that legally hires employees on your behalf. This means you can build a team in Bulgaria without setting up a local entity. The EOR handles all the legal and HR tasks that come with employment, like payroll, taxes, benefits, and compliance with Bulgarian labor laws. Think of it as a way to simplify your global expansion. You focus on your business, while the EOR takes care of the employment paperwork. For a practical solution, consider an EOR provider like Rivermate.

How an Employer of Record (EOR) Works in Bulgaria

Using an EOR in Bulgaria simplifies the hiring process. Here is how it generally works:

1. You find the talent. You recruit and select the candidate you want to hire in Bulgaria.
2. The EOR drafts the contract. The EOR creates a legally compliant employment contract that meets all Bulgarian labor law requirements.
3. The EOR onboards your new hire. They handle all the necessary paperwork to get your new employee started, including tax forms and banking details for payroll.
4. They manage payroll and benefits. The EOR processes salaries, taxes, and social security contributions accurately and on time. They also administer employee benefits.
5. Ongoing HR support is provided. The EOR acts as a local point of contact for your employees, answering any questions they have about their employment, HR, or payroll.
6. You manage your team's work. While the EOR handles the legal and administrative side of employment, you manage your employee's day-to-day tasks and responsibilities.

Benefits of Using an EOR for Hiring in Bulgaria

Using an EOR to hire in Bulgaria offers several advantages. It removes the need to establish a legal entity in the country, which saves you time and money. This allows you to enter the market and start operating much faster. An EOR takes the administrative weight off your shoulders so you can focus on your core business activities.

Here are some key benefits:

• Stay Compliant. EORs are experts in Bulgarian labor laws and ensure you comply with all regulations, reducing your legal risks.
• Save Time and Money. You avoid the costs and complexities of setting up a local company and hiring an in-house HR team.
• Attract Top Talent. Offering competitive and compliant benefits packages becomes easier, helping you attract the best candidates.
• Streamline Operations. The EOR handles all HR and payroll administration, from onboarding to offboarding.

Rivermate's transparent pricing model eliminates complexity with a single, competitive monthly fee per employee. Unlike traditional PEO providers, our pricing in Bulgaria includes comprehensive HR support, benefits administration, compliance management, and access to our proprietary dashboard for real-time workforce analytics. No hidden costs, no setup fees—just straightforward pricing that scales with your business needs while ensuring full legal compliance in Bulgaria.

Hiring in Bulgaria can be a smart move for your business. The country offers a skilled workforce and competitive labor costs. But, like any new market, it has its own set of rules. Understanding the local labor laws is key to a smooth and successful expansion. This guide will walk you through the essentials of hiring in Bulgaria.

Employment contracts & must-have clauses

In Bulgaria, you must have a written employment contract with your employees. You need to register this contract with the National Revenue Agency within three days of signing it. The employee can legally start working only after the contract is registered.

Here are the essential clauses your employment contract must include:

• Your company's and the employee's details: This includes names, identification numbers, and addresses.
• Place of work: The address where the employee will be based.
• Job title and description: A clear outline of the employee's role and responsibilities.
• Start date and contract duration: Specify if the contract is for a fixed term or is indefinite.
• Working hours: The daily and weekly work schedule.
• Salary and payment frequency: State the basic salary and any additional payments.
• Paid leave: The amount of annual paid leave, with a legal minimum of 20 working days.
• Notice period for termination: The required notice for both you and the employee, which is typically 30 days for indefinite contracts.

Probation periods

You can include a probation period in the employment contract. This period allows both you and the new hire to see if the job is a good fit.

• Maximum duration: A probation period can be up to six months.
• For fixed-term contracts: If the contract is for less than a year, the probation period cannot be longer than one month.
• Termination: During the probation period, either you or the employee can end the contract without notice, unless a specific notice period is agreed upon in the contract.
• Single use: You can only have one probation period for the same employee in the same role at your company.

Working hours & overtime

Understanding the rules around working hours and overtime is crucial for compliance.

• Standard working week: The standard is 40 hours per week, usually spread over five 8-hour days.
• Flexibility: In some cases, you can extend the workday to 10 hours, but the weekly total cannot exceed 48 hours. This extra time must be balanced out with shorter workdays within a four-month period.
• Overtime limits: Overtime is generally limited to 150 hours per calendar year. With a collective bargaining agreement, this can be extended to 300 hours.
• Overtime pay: You must pay a premium for overtime work. The rates are:
  • 50% extra for work on weekdays.
  • 75% extra for work on weekends.
  • 100% extra for work on public holidays.

Public & regional holidays

Your employees are entitled to paid time off for public holidays. Here is a list of the public holidays in Bulgaria for 2025:

Source: Time and Date, PublicHolidays.bg

Hiring contractors in Bulgaria

You can also hire independent contractors in Bulgaria. This can be a flexible way to access specialized skills for specific projects. Contractors operate under civil contracts, not employment contracts, and are responsible for their own taxes and social security.

However, you need to be careful about worker misclassification. If a contractor's working relationship with you looks too much like a traditional employment relationship, the authorities can reclassify them as an employee. This can lead to penalties, back taxes, and the need to provide employment benefits.

An Employer of Record (EOR) can help you avoid this risk. An EOR acts as the legal employer for your workers in Bulgaria. They handle compliant contracts, payroll, taxes, and benefits. This ensures you are fully compliant with local labor laws while you manage your team's day-to-day work. Using an EOR is a straightforward way to hire in Bulgaria without the risk of misclassification.

Navigating compensation and payroll in Bulgaria is straightforward. The system is governed by the Bulgarian Labour Code and the Social Insurance Code. As a member of the European Union, Bulgaria presents a business-friendly environment with a competitive tax system. This makes understanding its payroll practices essential for any employer.

Payroll cycles & wage structure

In Bulgaria, you pay employees monthly. Salary payments are typically issued on the last working day of the month. You must provide employees with a payslip for each pay period, which can be in paper or electronic form. While not required by law, a 13th-month bonus is a common gratuity that some employees may expect.

Overtime & minimums

Bulgaria has a national minimum wage set by the government. As of 2025, the minimum monthly wage is BGN 1,077, which is BGN 6.49 per hour. These minimum rates apply to all employees, regardless of age or industry.

Overtime pay is calculated as a percentage supplement to the employee's regular wage:

• 50% for work on regular working days.
• 75% for work on weekends.
• 100% for work on public holidays.

Employer taxes and contributions

As an employer, you contribute to social security and health insurance for your employees. The total contribution rate can vary slightly depending on the employee's occupational category and risk profile.

Employee taxes and deductions

Employees also contribute to social security and health insurance from their gross salary. Income is taxed at a flat rate after these mandatory contributions are deducted.

In Bulgaria, you'll find a solid foundation of employee benefits and leave entitlements rooted in the country's labor laws. These regulations ensure that your team receives fair treatment and essential protections. Understanding these benefits is key to successfully managing your workforce in Bulgaria. You can also offer additional perks to attract and retain top talent in a competitive market.

Statutory leave

Bulgarian law provides several types of mandatory leave for employees.

• Annual Leave: You must provide a minimum of 20 paid working days of annual leave for each employee. This is a baseline, and you can offer more days in an employment contract.
• Sick Leave: Employees are entitled to paid sick leave if they provide a medical certificate. The first three days are paid by you, the employer, at 70% of their salary. After that, the National Social Security Fund covers the payments. An employee can take up to 18 continuous months of sick leave.
• Maternity Leave: Pregnant employees receive a generous 410 days of paid maternity leave. Of this, 45 days must be taken before the expected due date. The National Social Security Fund pays 90% of the employee's gross salary during this time.
• Paternity Leave: Fathers are entitled to 15 days of paid paternity leave after their child is born.

Public holidays & regional holidays

Your employees in Bulgaria are entitled to paid days off for public holidays. If a holiday falls on a weekend, the following Monday is typically a non-working day.

Typical supplemental benefits

To stay competitive, you can offer benefits beyond the legal requirements. Here’s a look at both statutory and common non-statutory benefits.

How an EOR can help with setting up benefits

Setting up a benefits package in a new country can be complex. An Employer of Record (EOR) simplifies this process for you.

An EOR already has a legal entity in Bulgaria, so you don't need to set one up. They handle all the administrative tasks related to employee benefits, including:

• Ensuring compliance with all Bulgarian labor laws.
• Managing payroll and contributions to social security and health funds.
• Administering both statutory and supplemental benefits.
• Offering competitive benefits packages to attract top local talent.

Using an EOR saves you time and reduces risk. You can be confident that your Bulgarian team receives the correct benefits, and you can focus on growing your business.

Ending a working relationship in Bulgaria involves specific legal steps. You need to follow the rules to ensure a smooth and compliant process. Terminating employment can happen in a few ways: both parties can agree, one party can give notice, or a fixed-term contract can expire. Any termination document must be in writing. If you, as the employer, start the termination, you must have a legally valid reason. Failing to follow the correct procedures can lead to legal issues.

Notice periods

When you end an employment contract, you usually need to give notice. The length of this notice period depends on the type of contract.

• Indefinite term contracts: The standard notice period is 30 days. You and the employee can agree to a longer period, up to a maximum of three months.
• Fixed-term contracts: The notice period is three months, but it cannot be longer than the remaining time on the contract.

The notice period starts the day after the employee receives the written notification. If an employee wants to resign, they also need to provide a written notice and respect the agreed-upon notice period.

Severance pay

Whether you owe severance pay depends on the reason for termination. Here are some common situations where severance is required:

• Mutual agreement: If you offer to end the contract and the employee agrees, you must pay them at least four times their gross monthly salary.
• Company closure or downsizing: If you terminate an employee because the company is closing, a part of it is closing, or you are reducing staff, you owe them one month of severance pay.
• Illness: If an employee has at least five years of service and their employment is terminated due to illness, they are entitled to two months' gross pay as severance.
• Retirement: An employee who becomes eligible for a pension is owed two months' pay. This increases to six months' pay if they have worked for the company for 10 years or more.

How Rivermate handles compliant exits

Navigating the details of Bulgarian labor law can be complex. We make sure every termination is handled correctly and fairly.

We manage the entire offboarding process for you. This includes:

• Preparing and delivering all necessary legal documents in writing.
• Ensuring the correct notice periods are given.
• Calculating and processing any required severance pay.
• Advising on the valid legal grounds for termination to avoid disputes.

We stay up-to-date with all local labor laws so you don’t have to. Our goal is to make the process clear and compliant, protecting you from legal risks and ensuring a respectful exit for your employees.

Navigating visas and work permits in Bulgaria can seem complex, but we are here to simplify it for you. If you are not a citizen of an EU country, you will generally need a work permit and a long-stay visa, known as a Type D visa, to be employed in Bulgaria. The process involves multiple steps and coordination with Bulgarian government agencies. Your employer in Bulgaria typically starts the application for your work permit. This process often includes a "labor market test" to show that the role cannot be filled by a local Bulgarian or EU citizen. Once the work permit is approved, you can then apply for your Type D visa. For highly skilled individuals, the EU Blue Card offers a more streamlined path to working in Bulgaria.

Employment visas & sponsorship realities

An Employer of Record (EOR) can be your legal employer in Bulgaria, making the process of getting a work visa much more straightforward. This is especially helpful if your company does not have its own legal entity in the country.

Here is what an EOR can do:

• Act as your legal employer We take on the legal responsibilities of hiring you in Bulgaria.
• Sponsor your work permit We handle the entire application process with the Bulgarian authorities.
• Manage local compliance We ensure your employment contract, payroll, and benefits all meet Bulgarian labor laws.

The typical route to employment for non-EU citizens involves securing a job offer first, as Bulgaria does not issue open work permits. With a job offer in hand, the EOR can then manage the necessary steps to get you the proper authorization to work.

Business travel compliance

For short-term business visits, the rules are different. If you are visiting Bulgaria for meetings, conferences, or other business-related activities for up to 90 days within a 180-day period, you may need a short-stay visa, known as a Type C visa.

Key points for business travelers:

• Visa-exempt countries Citizens of many countries, including the United States, Canada, and Australia, do not need a visa for short business trips.
• Invitation letter If you do need a visa, you will likely need a formal business invitation from a company based in Bulgaria.
• Required documents Common requirements for a Type C visa include a valid passport, proof of accommodation, travel medical insurance, and evidence of sufficient funds for your stay.

It is important to understand that a short-stay business visa does not permit you to work. For any activities that are considered employment, a full work permit and long-stay visa are necessary.