Union discontent at Bulgarian Telecommunication Company

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In late 2004, trade unions at the newly privatised Bulgarian Telecommunication Company (BTC) announced that they were pulling out of the Council for Reconciliation of Interests (CRI), the social dialogue body for the communications sector, in protest at management's employment policies.

The privatisation of the state-owned Bulgarian Telecommunication Company (BTC) was finalised in late January 2004, with a 65% stake sold to the Viva Ventures company, backed by the American equity firm, Advent (BG0402101N). By late 2004, trade unions represented at the company - affiliates of the Confederation of Independent Trade Unions in Bulgaria (CITUB) and the Confederation of Labour Podkrepa (CL Podkrepa) - have become increasingly discontent with developments since privatisation.

The trade unions claim that BTC is being restructured over-hastily, the workforce is being reduced drastically, and some management actions systematically violate and evade the provisions of the Labour Code and the company collective agreement (a new agreement was signed in summer 2004). According to the unions: 'the social tension escalates and the major results of the company restructuring so far are lack of trust, and an unbearable atmosphere of fear and stress.' The union's main complaints concern:

• the failure to present an employment programme and payroll data for discuReconciliationssion by the Council for Reconciliation of Interests (CRI) - the sector's main social dialogue and negotiation forum - thus allegedly violating the BTC collective agreement;

• using the 'programme for voluntary departure' that accompanies the post-privatisation workforce reduction process as an instrument for large-scale forced redundancies;

• wide-scale transformation of employment on open-ended contracts into fixed-term employment with probation periods;

• failure to include in new employment contracts length-of-service allowances pro rata to basic pay, in line with the provisions of the Labour Code; and

• making English-language proficiency a requirement for many new positions.

The BTC 'programme for voluntary departure' came into effect on 1 August 2004. Essentially it provides for employees to leave the company with a lump-sum payment of up to 17 months' gross pay, depending on length of service in the company, age and the number of years remaining to retirement. Some 342 applications for voluntary departure were made in the first 10 days after the programme opened, and the total has now grown to about 3,500. This indicates that the planned workforce reduction of about 4,000 workers over two years will be completed by the end of 2004.

BTC management has rejected all the trade unions' accusations, stating that they are unjustified and that all changes in employment in the company have been made in compliance with labour legislation. The urgent measures are said to be necessary because the administrative restructuring of BTC must be completed by the end of 2004 and, after these processes are finalised, there will be a pay rise from the beginning of 2005.

It is planned that BTC's current 11 'regional telecommunications administrations' (RTAs) should be integrated into four 'mega-RTAs'. The transfer of employees to the new employers (ie the mega-RTAs) will be performed by offering them new job openings and positions. This is a main source of current disputes and industrial relations tension. The trade unions believe that these workers are not really switching to a 'new employer', with BTC remaining the actual employer, and that the whole exercise is being used to avoid the accusation of mass redundancies.

There are also plans to make redundant the personnel involved in certain service activities by the end of 2004. The following will be outsourced (to BTC's contractor companies):

• cleaning and maintenance of all BTC premises;

• security;

• management and maintenance of catering facilities;

• maintenance of company recreation and resort complexes; and

• maintenance and operation of the heating installations.

In late 2004, CITUB and CL Podkrepa joined their local unions in issuing a joint statement, announcing that they will end their participation in the communications sector Council for Reconciliation of Interests. They made a strong protest against the staff policy being implemented and accused the management of the newly privatised company of 'simulating' social partnership. The unions underlined their determination to use any and all legal instruments to protect workers' rights and interests. It should be noted that the opportunities for the trade unions to exert pressure are limited, since the communications sector is one of several where their is an effective strike ban (BG0401101N).