Consensus among social partners on anti-crisis measures

Bulgaria’s government presented a package of proposed anti-crisis measures at a meeting held in December 2008 with representatives of the social partners, public organisations and the media. The social partners expressed similar positions with regard to labour market measures. In particular, they agreed on the importance of concentrating resources and efforts mainly on unemployment prevention and preserving existing employment, rather than on compensatory measures.

On 5 December 2008, Bulgaria’s Prime Minister, Sergey Stanishev, presented a package of measures seeking to address the economic crisis underway at present. The meeting was attended by representatives of the social partners, public organisations and the media.

Anti-crisis measures

The government’s proposed anti-crisis measures aim to stimulate employment by focusing on the three following courses of action:

  • supporting employers using the resources provided for under the operational programme ‘Human resources development’ – this would involve the planned training and retraining of 150,000 persons, at least 64,000 of whom would be employed and over 10,000 of whom would start their own business;
  • allocating funds under the National Employment Plan for 2009 – over BGN 27 million (about €13.8 as at 9 February 2009) is being planned for some 20 programmes seeking to encourage employers to create jobs, while about BGN 15 million (€7.7) is being earmarked for the integration of people with disabilities. Special attention is to be paid to the programme ‘New employment opportunities’, under which 5,000 persons would be hired;
  • proposing measures for the protection of existing employment – one of the proposals involves recognising up to 160 days of unpaid leave a year as seniority and insuring the length of service. Another proposal recommends that half of the payable contributions be at the expense of the state and the other half at the employer’s expense. Other measures to that effect involve the encouragement and guarantee of part-time employment for more than three months.

Trade union and employer proposals

The Confederation of Independent Trade Unions in Bulgaria (Конфедерация на независимите синдикати в България, CITUB) is proposing that the country’s funds and efforts be predominantly focused on financing the proposed labour market measures with the aim of protecting existing employment, as well as those who are at risk of losing their jobs. In addition, the confederation is requesting that its own draft measure be included in the National Employment Plan 2009. Under the slogan ‘to preserve employment’, this measure envisages targeted state subsidises for employees who are at risk of losing their job when working hours are reduced. CITUB envisages that the implementation of its proposed measure could help to retain the jobs of up to 19,000 qualified workers and employees through the provision of state subsidies for up to three months, calculated as a percentage of the minimum wage (approximately €122 a month), taking into account the percentage of reduced working hours. It adds that such a measure could also help to alleviate the temporary difficulties brought about by the global financial and economic crisis.

CITUB contends that it is therefore of the utmost importance that the social partners draft joint industry analyses, in order to identify the potential parameters of the crisis and its continuing impact on employment. In particular, target groups should be identified in terms of regions and occupations, while a focus should be maintained on vital companies in industry.

This measure has received the support of the Confederation of Employers and Industrialists in Bulgaria – the Voice of Bulgarian Business (Kонфедерация на Работодателите и Индустриалците в България, CEIBG), whose anti-crisis plan includes similar aspects, notably:

  • the introduction of flexible working hours that will guarantee the preservation of jobs, in light of the fact that there will be an inevitable drop in the number of orders. This option is a far better alternative than multiple bankruptcies and permanent unemployment;
  • compensation for workers with reduced working hours under the ‘Guaranteeing the receivables of workers and employees in case of insolvency of the employer fund’ – such compensation should amount to about 20%–30% of workers’ pay for their usual working hours.

The priority of protecting existing employment was supported by the Chair of the German-Bulgarian Trade and Industry Chamber (Германо-Българска индустриално-търговска камара/ Deutsch-Bulgarische Industrie- und Handelskammer, AHK/DBIH), Bertram Rollmann, also a leading foreign investor in the country’s clothing industry. According to Mr Rollmann, this would be the most effective measure, both in terms of shared responsibility and of retaining qualified workers in the industry and Bulgaria’s position in the region

Additional proposals

The discussions generated a number of other interesting proposals; however, such proposals did not generate the same level of unanimous support from the government and social partners, or were regarded as too far-fetched. Nevertheless, it is worth mentioning two proposals put forward by the Bulgarian Industrial Association (Българска стопанска камара, BIA), which recommended:

  • establishing an organisation for the training and retraining of unemployed people, in the form of a public-private partnership (PPP). Unemployment benefits would be suspended if the participants opted out of this training;
  • increasing by 10% the number of students in the country, thus creating conditions for upgrading the qualifications of Bulgaria’s future workforce and reducing the pressure on the market due to growing numbers of unemployed young people, while also creating additional employment in the educational field.

In relation to the first measure, the trade unions criticised it as a poorly concealed attempt to establish an organisation that will effectively act as a national temporary employment agency. The Ministry of Labour and Social Policy (Министерство на труда и социалната политика, MLSP) discounted the second proposal, arguing that it would create a negative impact on employment and the labour market after the end of the crisis.

Lyuben Tomev, Institute for Social and Trade Union Research (ISTUR)

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