Bulgaria: Latest developments in working life Q3 2019

A large-scale campaign against the informal economy, the long-awaited new national tripartite agreement and a protest rally about wage increases in the healthcare sector are the main topics of interest in this article. This country update reports on the latest developments in working life in Bulgaria in the third quarter of 2019.

Major campaign launched against the informal economy

Between July and September, the Confederation of Independent Trade Unions of Bulgaria (CITUB) and representatives of the General Labour Inspectorate and the National Revenue Agency (NRA) conducted an awareness-raising campaign in regional cities about the damages caused by the informal/grey economy.

At a press conference on the grey economy in Dobrich, CITUB President Plamen Dimitrov said:

Around 21% of the Bulgarian economy is in the ‘grey’ sector and, in 2018, 16% of all employed people in the country took part in undeclared work. One in every seven people has accepted money in an envelope. [An estimated] 80–90% of the auto parts trade and the repair of motor vehicles are in the grey sector. Other areas with a large percentage of grey practices are the clothing industry, agriculture and construction. [In total], 620,000 people are employed in agriculture in Bulgaria and only 107,000 of them are insured.^[1]

Since 8 July, the app has been downloaded by over 10,000 users, about 50 reports have been submitted and 85% of these reports have been in relation to violations of employment relationships. ^[2] At the end of the campaign, employers will be ranked on their practices (correct or incorrect) based on the reports submitted and proposals for legislative changes will be made.tpA new CITUB mobile application, VOX KNSB, was introduced as part of the campaign. This app is a free service that allows users to report incorrect company practices or irregularities in their workplace, as well as share positive practices. The app is available on Android and iPhone, and the anonymity of users is guaranteed (only CITUB administrators have access to user data). The reports reach a large group of people that can support them, share them, or monitor what happens with the solutions to the problem. Photographic material may be attached, and the app automatically registers the location from which the report has been sent.

New national tripartite agreement after 13 years

After more than a decade, a national tripartite agreement is nearing finalisation. The agreement will have a two-year term that is due to come into force when the current government's mandate expires.

CITUB initiated preparation of the agreement in July and was subsequently joined by the Confederation of Labour Podkrepa, the Bulgarian Industrial Association (BIA), the Bulgarian Industrial Capital Association (BICA), the Confederation of Employers and Industrialists in Bulgaria (CEIB) and the Bulgarian Chamber of Commerce and Industry (BCCI). The unions and employer organisations were able to reach a consensus after significant negotiations, and they presented a draft text of the agreement to the government on 10 September. The government is expected to give its notes and proposals in early October, after which the new agreement will be signed.

The draft envisages the implementation of commonly agreed priority measures in four sections:

• the business environment and the economy
• energetics
• demography, education, the labour market and labour migration
• social protection policies

If the agreement becomes a reality (which is highly likely due to the level of support from all sides), it will be a significant achievement for national social dialogue, as there have only been three other such agreements at national level in Bulgaria’s recent history: ^[3]

• Charter for social cooperation and Memorandum on priority joint actions between the government, trade unions and employer organisations (1997)
• Social Charter and Memorandum for priority actions (2001)
• Pact for the economic and social development of Bulgaria 2006–2009 (2006)

Protest rally over wages in the healthcare sector

On 7 October, nearly 5,000 health workers from across Bulgaria took part in a rally in front of the Council of Ministers building in Sofia. The rally was organised by the Federation of Health Trade Unions – Health Service (FTU-HS, an affiliate of CITUB) and the Bulgarian healthcare professionals association. The main demands from the protesters include:

• obligatory compliance with the collective bargaining agreement to achieve differentiated remuneration for health professionals according to their qualifications
• political agreement on decent pay, good working conditions, professional qualifications and career development
• a long-term vision for healthcare up to 2030 with well-defined timelines, funding and responsible institutions
• urgent legislative measures to eliminate the status of hospitals as commercial companies

In addition, the FTU-HS wants the Ministry of Health to introduce a unified methodology for the distribution and fair balance of salaries, and the additional bonuses for all state and municipal hospitals, in order to reach the projected minimum wage of BGN 900 (€460 as at 23 October 2019) for nurses, midwives and laboratory technicians.

In response to a declaration adopted during the protest by those attending the rally, ^[4] Minister of Health Kiril Ananiev pledged to assign BGN 200 million (€102 million) more to financing hospital healthcare in the 2020 budget.

Commentary

Bulgaria expects to join the Exchange Rate Mechanism (ERM II) and the euro zone, but a number of economic and social requirements must be fulfilled first. This implies that the effectiveness of social dialogue needs to improve.

The difficult situation in the healthcare sector continues to be a source of social tension. Protests (organised and spontaneous) have been commonplace for the past two years. Despite the sectoral collective bargaining agreement that was signed at the end of 2018, the agreed starting salaries are not honoured in many places and Bulgarian healthcare staff are among the lowest paid in the EU. The consequences are regular conflict, the collective resignation of doctors and nurses, and ongoing protests in Sofia and other cities in the country.