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					                    The evolving structure
      of Collective Bargaining in Europe
                                 1990-2004

Research Project Co-financed by the European Commission
                     and the University of Florence

                           (VS/2003/0219-SI2.359910)




                          National Report
                                  Bulgaria
Teodor Detchev ( t_dechev@abv.bg ) Institute for Social Analyses and Policies
(ISAP).
Rumiana Gladicheva ( sea357sun@yahoo.com ) Department of Sociology,
Sofia University.
Vesselin Ilkov ( v.ilkov@yahoo.com ) Chief Expert, European Integration ad
International Relations Directorate, Ministry of Labour and Social Policy.
LIST OF ABBREVIATIONS


BCCI - Bulgarian Chamber of Commerce and Industry
BIA - Bulgarian Industrial Association
BUPE - Bulgarian Union of Private Entrepreneurs
CAs - Collective Agreement(s)
CB - Collective Bargaining
CCAs - Company Collective Agreement(s)
EABG - Employers Association of Bulgaria
IR - Industrial Relations
LC - Labour Code
MNC – Multi-national companies
NCTC - National Council for Tripartite Cooperation
NSC – National Sectoral Classification
SAC – Supreme Administrative Court
SBCAs - Sectoral/Branch Collective Agreement(s)
SCAs - Sectoral Collective Agreement(s)
SMEs – Small and Medium size Enterprise(s)
UPEE - Union for Private Economic Enterprise




                                                     2
       1.      CHRONOLOGICAL               OVERVIEW          OF      THE     BULGARIAN
       LEGISLATION OF COLLECTIVE AGREEMENTS (CA)
                                                                        Vesselin Ilkov
       The collective bargaining (CB) as a process or as it is known in Bulgaria the
collective labour contract which for the purposes of this report will be called collective
agreement (CA) as a result of this process is arranged in the Labour Code (LC),
(Promulgated SG, N 26 of 1.04.1986). It was arranged after the democratic change in
1989 for the first time with an amendment of the LC of November 1992 in Chapter Four
(SG, N 100 of 1992).
       The main preconditions for regulation of the CA institute were, on the one hand –
the progressive major changes in the social-economic relationships in Bulgaria after
1990 and, on the other hand – the newly adopted legislation: the new democratic
Bulgarian Constitution, in force since 13.07.1991, proclaiming in its preamble the
establishing of social State, guaranteeing the free exercise of the right to labour and to
association as well as a number of laws and secondary legislative acts providing more
opportunities to realization of the free economic initiative. All this created the necessary
favourable climate for adoption of modern and in compliance with the principles,
traditional for the democratic states, in the field of the labour relationships, namely in the
field of social dialogue. With the newly adopted legislation were introduced substantial
changes in the philosophy of the collective bargaining. Before 1989, under the conditions
of a centralised plan economy and lack of independent trade unions, the CA was deemed
to be an agreement-bargain. With its new regulation with the LC of 1992 it was settled
down that with a CA only more favourable than the minimum requirements envisaged in
the imperative law norms could be contracted. The CA legal institute is regulated
currently in Chapter Four (Art. Art. 50-60) LC. Ever since its first regulation up to now it
was amended several times and proved its sustainability and necessity. The amendments
of 1995 and 2001 were provoked by the registered in the practice inaccuracies and non-
regulated issues. The amendments during the period had made the different provisions
more clear and unified and consequently, more effective.




                                                                                            3
       1.1 Subject of the CA


       When comparing the text of Art. 50, in its wording of 1986 with Art.50, after its
amendment of 1992, comes out the enormous conceptual and meaning difference in the
legislative approach used before and after the reform in the field of collective bargaining.
Pursuant to Art. 50, para.1 of 1986, which was in force in 1990, with the CA was
ensured development of the democracy in the labour relationships, confirming of the
labour team as an owner of the socialist property as well as the fulfilment of the future
plan including the plan for social development of the labour team. Apparently, this
provision did not have a matter core which could disclose what exactly the subject of
collective bargaining was.
       With the amendment of the LC of 1992 and the new regulation of the legal
institute of the CA its philosophy was completely changed, the subject of CA already has
acquired clear content by including in it “issues of the labour and social security
relations of employees which are not regulated by mandatory provisions of the law”.
According to the definition the scope of the CA is determined by two major pre-
conditions – first (positive approach) – fixing the set of issues that could be contracted
and the second (negative approach) – these issues not to be regulated with imperative
norms. Such issues of labour relationships are: working time, rest periods, leaves,
professional qualification, safety and health at work, gender equality, protection for
certain groups of workers etc., as well as social protection issues - health and social
security matters. Concerning the scope of issues, which are subject to collective labour
bargaining it, should be made a clear distinction from those subject to tripartite co-
operation. According to Art.3, para.1 of LC of 1992 the State shall carry out the
regulation of labour relations and the immediately related relations, the social security
relations, as well as the living standard issues, in cooperation and after consultations with
the employees' and the employers' representative organisations.
       At first, the tripartite co-operation in Bulgaria was regulated in a number of by-
laws the main of which were: Rules on Defying of the Principles, Rules and Conditions
for Recognition of the Employees’ and Employers’ Organisations for Representative at
National Level in the Tri-partite Co-operation, approved by CM Decree No 7 of 22
January 1993 (Prom. SG, No.8 of 29 January 1993, amended and supplemented in 1998),

                                                                                           4
Working Rules of the National System for Tripartite Co-operation, approved with
CM Decree No 51 of 15.3.1993 (Promulgated SG, No. 23 of 23.3.1993), Ordinance on
the Procedure for Ascertaining the Presence of Criteria for Representation of the
Employers’ and Employees’ Organisations (Decree of CM N 41 of 1998,
promulgated, SG, N 22 of 1998, amended. This scattering legal approach was opposed
by both the academicians and legal practitioners. Furthermore, Supreme Administrative
Court (SAC) with its two judgments abolished, first the Ordinance on the Procedure
for Ascertaining the Presence of Criteria for Representation of the Employers’ and
Employees’ Organisations (Judgment of SAC № 6563 of 30.12.1998 – SG, No. 7 of
26.01.1999, in force since 26.01.1999, deleted, No. 64 of 18.07.2003), and second, the
amendment from 1998 of the Rules and Conditions for Recognising of the Employees’
and Employers’ Organisations for Representative at National Level in the Tri-partite Co-
operation (Judgment of SAC № 7353 of 5.12.2000 - No. 102 of 12.15.2000, deleted,
No. 64 of 18.07.2003) Consequently, surprisingly to nobody, the regulation of the tri-
partite co-operation came to its only logical development - amendments in the Labour
Code from March 2001. With those amendments, as stated Professor Mratchkov1, were
introduced two significant changes. Firstly, rang-raising, scope-widening and better-
structuring of the legal order, and secondly, introduction of new provisions                                       (Art.3,
para.2, Art.3c) by which, in practice, the tripartite co-operation legal matter was
enriched. With this amendment in the new Art. 3a the tripartite co-operation within the
National Council for Tripartite Cooperation (NCTC) was regulated by the Labour Code.
Later the tripartite co-operation within the National Council for Tripartite Cooperation
(NCTC) was introduced with the adoption of the new Art. 3a LC (Promulgated, SG N 25
from 2001). From the comparison between the bilateral bargaining which is subject to
this report and the subject of the tripartite dialogue it becomes obvious that the subject of
the tripartite dialogue is more comprehensive and includes the matter of the living
standard. These two types of issues should not be regulated by “imperative provisions of
law”, which means not only imperative Law norms but also imperative norms of
secondary legislation. The reasons for lack of normative regulation might be set in two
main groups: the first – issues related to labour and social security relations which are


1
    Mratchkov, V., Kr. Sredkova, At. Vassilev, 2001. Comments on the Labour Code, “Sibi” Publishing House, Sofia


                                                                                                                        5
not regulated by law at all. The possible grounds for that might be the following:
omission, incompleteness of the legislation or purposeful omission of regulation. The
second group of reasons - the labour and social security issues are regulated not by
imperative but with supplementary norms.


      In para.2 of Art. 50 LC, in its wording of 1986 was envisaged that with the
collective agreements could be regulated also questions of labour relations that were not
regulated with imperative provisions of this Code and other legislative acts issues for its
implementation.

      Regarding para.2 the amendment of 1992 was not as significant but nevertheless
included important supplement relating to the subject of the CA by providing an explicit
prohibition “to contain clauses which are more unfavourable to the employees than the
provisions of the law”. In 2001 the text of this provision was extended additionally with
the requirement the CA not to contain clauses, which are more unfavourable to the
employees than the provisions except of the law also “of collective agreement, which is
binding upon the employer”. With the supplement it was added one more level to which
to be compared the contracted issues under a CA. This new text provides guarantees for
preservation of a higher level regulating the rights of the employees through a CA, to
which the employer is bound to, than that envisaged in Law.




      1.2 Parties and levels of collective bargaining


      Article 51
      (Amended - SG, Nos. 2/1996; 25/2001)

           (1)      Collective agreements shall be concluded by enterprises, branches,
    industries and municipalities.

           (2)      Only one collective agreement may be concluded at the level of
    enterprise, branch and industry.
      In the first wording of Art.51, para.1 of LC from 1986 it was envisaged that
collective labour contract should be concluded between the labour team and the

                                                                                         6
undertaking. This first wording disclosed the characteristic of the socialist planned
economy lack of the main players of the collective bargaining – employer (employers’
organisation) and trade unions.
      In 1992 the provision of this article already contained the normal for collective
bargaining players and levels for concluding CA. Regarding the parties the wording of
this article from 1992 comprised their particular description which in 2001 was reworded
and the parties to the collective bargaining were regulated in single articles according to
the different levels of collective bargaining. The main purpose for this amendment was
to be reached systematising of the different levels. The levels of collective bargaining
according to Art.51 of LC, SG, N 100 of 1992, were three types – in sectors,
professions and administrative-territorial units, which with amendments of 1995
were supplemented with enterprises and branches. In 2001 were made two changes:
the bargaining on the level of professions dropped out, the main reasons for which was
the obvious lack of interest of the parties to the CA to that level during the past almost
than ten years since its introducing and the amendment at the level “on administrative-
territorial units” into “on municipalities”. Thus, the legislator specifies the term used
up to this moment. As a result of the amendments, now exist four main levels of
collective bargaining in the Bulgarian labour legislation.
      Para.2 of Art. 51 in its wording of 1992 “Only one collective agreement may be
concluded at the level of enterprise, branch and industry”. The collective bargaining at
municipality level is exception.




      1.2.1 Types of levels of collective bargaining


      1.2.1.1 Collective Agreement in Enterprises


      Article 51 a
      (New – SG, No. 25/2001)

           (1)       Within an enterprise the collective agreement shall be concluded
    between the employer and a trade union organisation.


                                                                                         7
              (2)         The trade union organisation shall prepare and submit a draft of
     collective agreement. Where more than one trade union organisations exist within
     one enterprise they shall submit a common draft.

              (3)         Where within the enterprise the trade union organisations fail to
     submit a common draft, the employer shall conclude the collective agreement with
     that trade union organisation the draft of which has been approved by the general
     meeting of the employees (the meeting of proxies) by majority of more than half of
     the members thereof.


         This is the first level at which CA can be concluded. At this level are concluded
most of the CA. First, the fact that they are most numerous is due to the fact that the
undertaking is the basic entity in which the labour relations are carried out. No matter if
the enterprise is small, medium or large. Furthermore, the undertaking is the place where
the rights and obligations of the players in the collective bargaining are interwoven –
employer and one or more trade unions. According to the legal definition for undertaking
this shall be “any place - enterprise, office, organisation, cooperative, establishment,
project and the like, where work against payment is done”;2
         The players at that level of collective bargaining are employer and trade union or
group of trade unions.
         Hereinafter, is given a narrow examination of each of these notions.
         “Employer" – that shall be any natural person, body corporate or division thereof,
as well as any other organisationally and economically autonomous entity (enterprise,
office, organisation, cooperative, farm, establishment, household, association and the
like),    that    independently hires            employees   under   employment   relationships;3.
” trade union organisation” is that one which is created with view to exercise trade
union activity and exercise the right of trade union association4, and carries out its
activity in the same undertaking.
         It is necessary, both subjects involved in the process of bargaining at that level to
perform their activity at one and the same place – the territory of the undertaking. It is

2
  § 1, т.2 of the Additional provisions of Labour Code.
3
  Pursuant to §1, p.1 of Additional Provisions of LC.
4
  Art.Art.4 and 33 LC.

                                                                                                8
important to be noted, that up to this moment in the Bulgarian legislation the trade union
is the only legal subject, which can negotiate and conclude CA on behalf of the
employees. Related to this, should be underlined the particularity of collective
bargaining at company level at which the trade union organisation could be also non-
representative at national level. This conclusion can be drawn not only from the
grammatical interpretation of the provision of para.1, but also from the systematic
interpretation of the other provisions concerning the other levels of collective bargaining
– sectoral/branch5 and municipality6. For these types of CA it is explicitly said, that
CA shall be concluded by the relevant “representative organisations of the employees”.
For enterprise level there is no such requirement:

             “Within an enterprise the collective agreement shall be concluded between
     the employer and a trade union organisation” 7.
        The requirement for representativeness is extended also for the other party to the
CA – employer’s organisation.
        Concerning the possibility, other bodies, also to take part into the collective
bargaining as “work councils”, it is useful to be explained, that in fulfilment of the
commitments taken under negotiating chapter 13 “Social Policy and Employment”,
sector “Labour Law” the Bulgarian government is going to implement the requirements
of Directive 94/45/ЕC on European Working Councils.8 This is envisaged to be
conducted within the period 2005-2006 through an amendment in the LC, and shall come
into force from the appointed for accession of Republic of Bulgaria to the EU – 1
January 2007.




5
  Art. 51b LC.
6
  Art. 51c LC.
7
  Art. 51а, para.1 LC.
8
  Addition information on the Common position of EU on Chapter 13, “Social Policy and Employment“ (CONF-
BG 63/01).

                                                                                                           9
        1.2.1.2 Collective Agreement on Industry and Branch Levels



        Article 51b
        (New – SG, No. 25/2001)

             (1)        The collective agreements by industries and branches shall be
     concluded between the respective representative organisations of employees and of
     employers on the basis of an agreement between their national organisations,
     which shall set forth general provisions in respect of the scope and the procedure
     framework of the industry and branch level agreements.

             (2)        The representative organisations of the employees shall prepare
     and submit a common draft to the representative organisations of the employers.

             (3)        Where the collective agreement on industry or branch level has
     been concluded between all representative organisations of the employees and of
     the employers in the industry or the branch, the Minister of Labour and Social
     Policy may, upon their joint request, extend the application of the agreement or of
     individual clauses thereof to all enterprises of that industry or branch.


        As it was pointed in the previous paragraph the parties of the CA at
sectoral/branch level should be national representative. Such are those trade unions’ and
employers’ organisations to which are recognised the quality under Art. 3, para.3-6 LC9
and currently it is defined under Ordinance on the Procedures for Identifying the
Presence of Criteria for Representation of Organisations of Workers and Employees and
Organisations of Employers10 The criteria themselves are identified in Art.34 and 35 of
LC, new Art. 34 – 36а LC.11
        Before reviewing the nature of collective labour bargaining at that level it should
be clarified the meaning which the notions “sector” and “branch” are given in Bulgarian
theory and practice. These notions are economic. They express the union of economic
activities of the same kind on the basis of their common characteristics – goods (their
market qualities, technology of its production, the used raw materials) or services (their
9
  In the wording of the LC 1992.
10
   Adopted with CMD № 152/11.07.2003, prom., SG, No. 64 from 18.07.2003.
11
   In its wording LC 2001.

                                                                                        10
type concerning the specific needs they satisfy). They are subject to classification and
ranking through explicit provisions. Such provisions are comprised in the National
Sectoral Classification (NSC).12 Related to the sectoral classification of a legal point of
view it should be highlighted three main particularities:
        Firstly, this classification is established in a departmental normative act with a
nationwide implementation. This act is legislatively compulsory. Secondly, the
classification comprises all fields of economic and public activities and thus includes not
only the branches of economy in which certain goods are produced or services are
provided but also social activities and state governance. Thirdly, “sector” and “branch”
are synonyms linguistically13. But in the labour legislation they have different meaning.
“Sector” is deemed as the basic and wider in scope notion and “branch” as the smaller in
scope and part of it – autonomous part of sector in which exist narrower grouping of
economic activities or sub-sector.

        The particularities of the collective bargaining at that level in Bulgaria are given
below. The sectoral/branch collective agreements (SBCA) are concluded on the “The
collective agreements by industries and branches shall be concluded between the
respective representative organisations of employees and of employers on the basis of an
agreement between their national organisations, which shall set forth general provisions
in respect of the scope and the procedure framework of the industry and branch level
agreements”14. The main idea, which is set behind this provision, is the concluding of
SBCA to be preceded by an agreement between the national representative trade unions'
and employers’ organisations. This agreement should be concluded between all such
organisations without exception. The agreement is a framework and includes
concordance on the general issues of the CA which can be separated in two groups.
        Firstly, the scope of collective bargaining, i.e. the issues of negotiation. It has to
be pointed out that this scope might be preliminary extended and enriched regarding the
specificity and particularities of the relevant sector/branch on which are subject to
collective bargaining;
12
   Approved with Order No РД-07-229 from 16 December 1997 of the Chairperson the National Statistical Institute
(prom. SG, No.3 from 1998), replaced with Order № РД-07-01 from 05.01.2001 of the Chairperson the National
Statistical Institute with National Classification of Economic Activities (NCEA) – prom. SG, No. 6 from 2001.
13
   From Russian “отрасъл” means part, branch of economy and “branche” is a French word with the same meaning
(Dictionary of the foreign words in Bulgarian language, issued. BAS, S., 1982 , p.151, 610).
14
   Art. 51b, para.1LC.

                                                                                                            11
           Secondly, setting of the procedure framework within which negotiations for
concluding of CA shall be conducted. This framework includes: terms, consequences of
the different negotiations stages, collecting of the necessary preliminary data, drafting of
CA, the main purposes of the future CA.
           The initiative and the obligation for drafting of a CA at enterprise level15, as well
as at of sector/branch level16 belong to the trade union/unions’ organisations.
           Special attention should be paid to the amendment of LC of 2001 - Art. 51b,
para.3 according to which there is possibility for extension of the concluded SBCA to all
the undertakings of the relevant sector or branch. This new possibility is adopted from
both legislation and practice of the Member States of the EU. The necessary
preconditions for the implementation of this provision are two: firstly, presence of
concluded CA between the representative organisations of the employees and of
employers of the sector or branch, and secondly, their mutual application to the Minister
of Labour and Social Policy for extension of the concluded CA. Given these both
preconditions the Minister of Labour and Social Policy might extend the application of
the concluded CA in the relevant sector or branch. It is important to be highlighted that
the Minister of Labour and Social Policy is not bound by law to make the extension at
any case even if the two requirements are fulfilled. The legislator has given the Minister
of Labour and Social Policy the full discretionary power for assessment not only to
extend or not the CA, but also if the extension shall cover the whole CA or just a part of
it. The act with which the extension shall be made is Order or Instruction of the Minister
of Labour and Social Policy in which are pointed the date from which the extension shall
come into force. The consequences of extension of CA are that the favourable provisions
take effect for all the employees, as well as obligations take effect for all the employers
in all the undertakings of the relevant sector or branch.




15
     Art. Art. 51а, para.2LC.
16
     Art. Art. 51b, para.2 LC.

                                                                                             12
           1.2.1.3 Collective Agreements by Municipalities


           Article 51 c
           (New – SG, No. 25/2001)

                (1)        In the municipalities collective agreements for activities financed
        from the municipal budget shall be concluded between the representative
        organisations of the employees and of the employers.

                (2)        The local divisions of the representative organisations of the
        employees shall submit common drafts of collective agreements to the local
        divisions of the representative organisations of the employers.
           Collective Agreements by Municipalities are concluded for activities financed by
the municipal budgets. Those are: public health, social, educational, cultural and other
activities17. Pursuant to para.1 these collective agreements are concluded between the
representative organisations of the employees and employers on the territory of the
relevant municipality. In the meaning of Art.8 of Law on Administrative and Territorial
Structure “municipality” shall be this administrative and territorial unit, which has
population of over 6000 people and is unifying centre with established social and
technical infrastructure.
            The requirement under para.1 collective agreements to be concluded only
between representative organisations of the employees and employers on the territory of
the municipality predetermine their small number, if any. This requirement is often an
obstacle for smaller municipalities where there are no such representative organisations.
In this relation, we consider necessary the revision of this provision and its eventual
amendment. As a possible solution for overcoming of the difficult situation on this level
we find reasonable only the removal of the requirement the parties of the CA to be
representative employees’ and employers’ organisations. No doubt, this would render the
process of collective partner at municipal level more active. Similarly to the other levels
of CA trade unions are those responsible for elaboration and presentation of the draft
CA. What is unique for that level only, is that in one single municipality might be
concluded more than common collective agreement. Their possible number is relevant to

17
     Art. 8 of Law on Municipal Property.

                                                                                           13
the number of the activities financed by the relevant municipality carried out in
undertakings18.




           1.3 Form of Collective agreement


           The collective agreement is concluded in a written form with three copies – one
for each party and one for the relevant Labour Inspectorate in the area where the
employers' seat is located, where collective agreement shall be registered in a special
register. The written form is a requisite for the validity of the collective agreement (ad
solemnitatem). The form of the CA is regulated currently in Art 53 of LC and since the
amendment of 1992 has not been amended.




           1.4 Entry into Force and Duration


           This extremely important element of CA is stipulated in Art. 54 of LC, which has
underwent considerable amendments during the period under review. Previously, in 1986
version the agreement entered into force not later than 15 days after its conclusion. In
1992 version was envisaged that the agreement enters into as from the date of its
conclusion, insofar as it does not provide otherwise.
           This text kept on taking effect without amendments. Amendments were made
concerning the duration of the CA, arranged in para.2. In the first version the term of
effect was fixed at one year while with the amendment of 1992 the legislator provided
another possibility for change of term through the wording for a term of one year, insofar
as it does not provide otherwise”. This wording was valid until 2001 amendment when a
considerable revision of the text was made according to which the CA may not stay in
effect longer than two years. It is necessary to be highlighted,that the parties of the CA
may negotiate for a shorter term for some of its clauses. This shorter term should be
compared to the term fixed in the CA and relevantly, may be shorter than a year or two.

18
     See footnote 2.

                                                                                        14
That possibility was expression of the awareness of employer that labour relations are
more dynamic and changeable and for this require more flexible legislative solutions.
The last amendment of Art 54 LC from 2001 was related to a new term – not shorter than
3 months before the expiry of the effective CA for beginning of negotiations for
concluding a new one.




      1.5 Effect with Regard to Persons

      Art. 57 LC outlines the circle of persons to whom the concluded CA shall have
effect. They are two groups: the first, regulated in para.1 are the employees - members of
trade union, party to the agreement, and the second, regulated in para.2, comprises the
rest of the employees. The normative regulation of the effect with regard to persons was
subject to several amendments and supplements concerning mainly the way for
accession to the CA for the second group of persons with aim to be applied to them.
Pursuant to Art.57, para.2 in its wording from 1992 this may be done with a written
application before the employer or trade union organisation. In 1996 the legislator
envisaged that accession might be done with a written application and no other
conditions had to be available. This amendment itself provoked arguments that the
employees- non-members of any trade union use the more favourable terms of the CA
without giving anything back. For that reason, para.2 was amended in 2001, and now the
accession shall be made under terms and provisions determined by the parties to the
agreement, such as may not be contrary to the law or evading the law, or such that are
offensive to the good morals. This new wording still contains uncertainty how far the
parties can get in defining the terms and provisions for accession. According to the
theory such terms may not be financial as it obviously may lead to stretching of the
privilege position of the parties to the CA. In conclusion, perhaps the best solution will
be if a concluded CA has effect with regard to all the employees in a relevant
undertaking.




                                                                                       15
      2. ACTORS INVOLVED IN COLLECTIVE BARGAINING


                                                                Rumiana Gladicheva, PhD
                                                      Dept of Sociology, Sofia University


      2.1 Representativeness and participation in Collective Bargaining (CB)


      In Bulgaria the notion of representativeness is fundamental for participation in
CB. According to the existing Legal provisions, only representative organisations can
take part in collective bargaining at national, municipal and sectoral/subsectoral level.
The representativeness at all levels (except company level) depends only on the
membership in central, nationally representative organisations. It holds for both
employees’ and employers' sectoral/branch organisations. It means that any
sectoral/branch federation must be member of nationally representative organisation in
order to play role in CB of a sector/branch. As mentioned in chapter 1., at company level
all legally registered trade unions can negotiate with employer no matter representative
or not. However, the dominant actors at company level are de facto again the sections of
nationally   representative   trade   union   confederations.    In   this   situation   the
representativeness at nation-wide level is of highest importance for participation in CB
at all levels down the scale. How is the representativeness measured in Bulgaria?
      In Bulgaria there is indeed counting of social partners’ membership supported by
legally arranged 'counting procedure'. The procedure verifies if the organisations of
social partners meet few clusters of requirements described in the Labour Code. A
special commission checks if data given by the social partners is correct. The social
partners have right to appoint own observers in the Commission. The counting procedure
is carried out by the Government.




                                                                                         16
        2.2 Results from the recent counting procedure, pointing out the nationally
        representative social partners for next 3 years (mandate for CB)


        The recent counting procedure started in October 2003 and finished in April
200419. It covered for the first time simultaneously both the trade unions and the
employers' associations. Two trade union confederations and five employers'
associations proved nationally representative. The results showed that:
        1) there is no change in the ‘territory’ of trade unions. The nationally
representative trade unions remain the same – the Confederation of Independent Trade
Unions in Bulgaria (CITUB) and the Confederation of Labour 'Podkrepa'. There was a
third one applicant but it did not meet the criteria stipulated by the Labour Code;
        2) however, there is a change in the employers' constellation. We have another
employers' association, already recognized at national level - Employers Association of
Bulgaria (EABG). This way the representative employers’ organisations at national level
have become five. Four of them have been representative since 1993 (described further
in the report).
        The counting procedure is carried out every 3-4 years and thereby the procedure
itself establishes an uncontested mandate for CB. There is no difference for the public
sector. At all levels of CB (except company level) only the structures of these 7
organisations will play role in the social dialogue during next 3 years20. Each of the
representative trade unions can take part in CB at sectoral/branch level via its relevant
federation, for example federation of trade, textile, construction, etc. Similarly, each
employers’ association can take part via its relevant branch chamber (if available), for
example: branch chamber of trade, construction, transport etc. It is not necessary to have
structures in all the sectors of economy.




19
   Changes, which started this way in the autumn of 2003, became visible in the beginning of 2004. The emergence
of a new player in the social dialogue is a fact that will influence the development of CB at least during next 3
years. That is why we extend the analyzed period by including some events that happened in 2004.
20
   In the meantime (after submission of the present report) a trade union confederation applied for the status of
nationally representative organization. It facilitated from the right to apply for it between the regular counting
procedures. It is called "Promiana" and it was recognized by the Government in the end of 2004. Thus, national
trade unions became 3. However, there is objection in The Court, so its status is still under question (in March
2005).

                                                                                                               17
       2.3 Main characteristics of the actors involved in collective bargaining


       2.3.1 Brief description of recognized representative trade union organisations in
       Bulgaria


       The tradition of union pluralism was interrupted in the middle of 20th century for a
period of 45-50 years (under the communist regime). Later (in the 1990s) Bulgaria
started to restore it. Trade unions were very strong in the beginning of democratic
changes (1989-1997) in terms of membership and public/political influence. Since 1990
now the membership has rapidly declined as well as the level of influence. Within recent
3-4 years trade unions have started to compensate the lost membership and influence by
announcing a broader social platform, i.e. trade unions declared to be representatives not
only of workers but also of different (disadvantaged) social groups like women, youth,
children, people with disabilities, and unemployed. Some emerged in the meantime
obstacles21 to effective syndical activities urged trade unions to enlarge their public space
of legitimacy. It caused a more intensive cooperation with relevant NGOs aimed at
achieving social cohesion.
       The largest and the only representative trade union confederations in Bulgaria are:
       1.       CITUB, Confederation of Independent Trade Unions in Bulgaria
       2.       Confederation of Labour Podkrepa.


       CITUB is successor of the Bulgarian Trade Unions, which existed under the
communist regime. The essence of change for CITUB was to become independent of the
state and communist party (financially, organisationally, and ideologically) and it started
to do that in 1990. CITUB has successfully undergone the necessary transformation, of
course, paying some price (mainly by loosing members and financial support).
Nevertheless, it is still the largest representative trade union organisation in Bulgaria and
its expert capacity is acknowledged.
       Confederation of Labour PODKREPA played a significant role in political
changes of the country being one of the basic founders of Union of Democratic Forces –


21
 Neo-liberal arrangements and Currency Board.

                                                                                          18
the biggest political formation opposing the ex-communist party. 'Podkrepa' was created
in February 1989, i.e. 9 months prior to the official political changes in Bulgaria and
therefore is considered as dissident formation. Yet, in 1991-92 there were tensions and
strain between the political and labour wings of the new democratic movement. So, the
Confederation of Labour 'Porkrepa' got alienated from political matters to certain extent.
However, as a whole it supports different wings of the former Union of Democratic
forces (right-centred). Ideologically, Podkrepa stays at anti-communist positions and it
still tries to maintain a more rebellious image than CITUB.
       With regard to political orientation of social partners in Bulgaria there is a
paradoxical fact: up to now trade unions have supported right-centred political
formations while most of employers have supported a left party. In contrast to Podkrepa,
CITUB has not had organisational links to any political parties or coalitions. However,
most of the time CITUB has supported right-centred political organisations.
Ideologically, CITUB emphasizes more the European integration process and values of
the European social dialogue than distinct national political values. CITUB is committed
to a more civilized dialogue and it is less confronting than Podkrepa.
       Both confederations are in fact general trade unions. There is not special
confederation covering public sector. However, both confederations are equipped with
several federations, which are responsible for different categories of employees in the
public sector – for example in public education, in healthcare, and public administration.


       It should be noted that in the middle of 1990s Bulgaria had 7 representative trade
unions. Yet, this number is misleading since the recognition of trade unions (except
CITUB and Podkrepa) was a matter of political intrigues and was not based on any
objective criteria. Because of that it did not show the real situation and consequently, it
did not last long time. The counting procedure, which took place for the first time in
1998/9 put an end to this chaos and showed the truth - indeed there are only two
significant trade union confederations in Bulgaria, representative at national level.




                                                                                        19
      TABLE 1: WORKERS’ ORGANISATIONS - institutional characteristics
    Organisation > CITUB, Confederation of               PODKPEPA Confederation
                    Independent Trade Unions in          of Labour
Dimensions          Bulgaria
Legal status        NGO, non profit                      NGO, non profit
European            ETUC                                 ETUC
affiliation
International       ICFTU                                ICFTU
affiliation
Mandate for CB      3 years (2004 -2007)                 3 years (2004-2007)
Structure of the    mainly by region and sector, but     by region and sector, also
organisation        there are also associated members    associated members
                    and territorial syndicates
Number of the       Total: 66, of which                  Total: 63, of which
organisation’s      regional – 28                        regional – 34
regional/sectoral/c sectoral and branch federations,     sectoral and branch
ollective           unions – 34                          federations, unions – 25
federations         associated members – 4               associated members – 4
Biggest             Federation of Bulgarian school       Federation Construction,
federations         teachers – 80,000                    Industry & Water Supply
(breakdowns by      FOSIL, Federation of light           Podkrepa (FSIWS) - 7,000*
areas of activity - industry – 25,000 Federation of      Federation of Energy Workers
number of           trade unions in healthcare –         - 6,000*
individual          23,000                               Federation of Transport
members)            Union of railway workers –           Workers - 6000*
                    22,000                               Federation of
                                                         Communications - 5,000*
Number of           375, 000                             150, 000
individual
members
Union Density       19%                                  6%
Type of workers     Prevailing share is composed of      Prevailing share is composed
covered             blue collars                         of blue collars
Year of creation    1990 (re-registered and              1989
                    transformed)
Financing of the    membership fee, voluntary            membership fee, voluntary
organisation        contributions, running projects,     contributions;
                    education and training;              no government subsidies
                    no government subsidies
Services of the     Yes – there are: Syndicate College   Yes - there is established in
organisation        (2003), National Educational         2000 Training and
offered to          Council (1995), regional             Consultancy Center.
members:            campaigns for mass training of
Training            activists on ongoing topics



                                                                                         20
Services of the          Yes – established in 1998                  Yes
organisation             Syndicate Advocating Agency for
offered to               legal consultations and support,
members:                 which has offices in 31 regional
Legal protection         structures
Services of the          Yes                                        Yes
organisation
offered to
members:
 technical support
                         Ability to negotiate and sign
                         collective agreements or take part
                         in consultations
Participation in         Yes, at all levels                 Yes, at all levels
consultations at
intersectoral,
sectoral or local
level
Negotiation and          Yes - negotiates and signs at all          Yes - negotiates and signs at
signing of               levels                                     all levels
collective
agreements
Participation in         Yes, at national, municipal,               Yes, at national, municipal,
tripartite               sectoral and branch level                  sectoral and branch level
concertation
        Source: The data in this table is collected in 2003 and 2004 by The Institute for Social Analyses
and Policies, last updated in 2004. The data is also validated by the very organisations. Note: Estimates
of respondents are marked by (*)



       2.3.2 Brief description of recognized representative employers' organisations
in Bulgaria

       Employers are currently (2004) represented by 5 central nationally recognized
associations:
       (1) - BCCI, Bulgarian Chamber of Commerce and Industry - recognized as
nationally representative in 1993;
       (2) - BIA, Bulgarian Industrial Association - recognized as nationally
representative in 1993;
       (3) - UPEE, Union for Private Economic Enterprise - recognized as nationally
representative in 1993;
       (4) - BUPE, Bulgarian Union of Private Entrepreneurs 'Vuzrazhdane' - recognized

                                                                                                      21
as nationally representative in 1993;
      (5) - EABG, Employers Association of Bulgaria - recognized as nationally
representative in 2004.


      In January 1993 four employers’ organisations: BCCI, BIA, UPEE and BUPE
'Vuzrazhdane' were approved by the government as nationally representative employers’
associations. In the end of 2003 a fifth central employers’ confederation applied for
national recognition – EABG. In March 2004 it was recognized as representative at
national level. For good or bad this is the most considerable event in the field of
Industrial relations within the recent few years. Obviously, the employers are more
fragmented than trade unions. In terms of number of members the biggest employers’
chamber is BCCI, while in terms of number of employees working for the member
companies the biggest is BIA (see the table below). BIA has also been acknowledged by
trade unions as the most adequate and engaged counterpart.
      BCCI and BIA were established prior to the democratic changes started in 1989.
Therefore, BCCI and BIA had to transform their principles, structures and ways of
participation in the new social order (similarly to CITUB). In our opinion their
transformation was successful and they are the largest employers’ organisations in
Bulgaria at the moment. They possess well-developed expert capacity, too.
      During the totalitarian period, The Bulgarian Chamber of Commerce and Industry
(BCCI) was the only organisation in which industrial managerial cadres (who cannot be
qualified as employers) participated. In 1980 The Bulgarian Industrial Association (BIA)
split out of BCCI. Under the communist regime (from 1967 to 1989) the BCCI
represented 'employers', of course formally, in the Bulgarian delegation at International
Labour Conferences. The membership with it was obligatory and, in accordance with
some authors, during this period BCCI could be considered as a subdivision of the
Ministry of Commerce. BCCI still performs some state functions (issuing licenses for
import/export and similar) and these functions certainly give some advantages in
attracting members. We mention these specific historical features in order to underline
the big transformation and significant evolution, undergone successfully by BCCI.
      The Bulgarian Industrial Association (BIA) was founded in 1980, when it
separated from BCCI. In 1991 BIA was transformed into an employers’ organisation of

                                                                                      22
national importance. BIA’s member companies account for the larger part of the Gross
Domestic Product (GDP) as well. The BIA has been the most relevant and important
player in CB at all levels in Bulgaria up to now (tripartite and bipartite).
       UPEE and BUPE were established after the political changes (in December 1989)
and organisationally they do not bear negative features of the past. They are mainly
oriented to private SMEs.
       As a whole these 4 employers’ associations have been quite civilized and
cooperative in the course of the social dialogue up to now.
       The newest player in social dialogue - The Employers Association of Bulgaria
(EABG) was established in 2000. EABG represents the interests of big business and
large-scale private capital in the country (companies with more than 100 employees).
They claim their members employ more than 200,000 workers and account for a
turnover of 2.8 billion USD. Yet, most of the member companies of EABG are also
members of BCCI or/and BIA, so these figures of success are 'shared'. In some sense
EABG stays in opposition to the other employers' associations. It has proclaimed its neo-
liberal platform. Considered together with the same believes of the present government,
it is not surprising that the development of industrial relations is pushed towards a neo-
liberal direction. At least attempt for doing that by its end is a possible scenario. Yet, the
mandate of present government will terminate in 2005 and political analysts foresee a
left government afterwards.
       The Employers Association of Bulgaria (EABG) is quite pro-active in the field of
the social dialogue. However, they show a visible neglect to the existing status quo of
tripartite arrangements and express their enemy to trade unions. They also reject the
sectoral collective bargaining (SCB) and claim on a new Labour Code, providing
employers with (almost) limitless options to make workers redundant at any time, and of
course, without any compensations. They also insist on drastic restriction of trade unions'
rights etc. All these articulated attitudes of EABG disrupt the polite tone of the social
partnership. Trade unions perceive this new configuration as a challenge to the
cooperative style of social dialogue in Bulgaria and predict a frustration of civilized
climate during negotiations in the future.
       In general employers are not inclined to announce soundly their political
orientations. Yet, it is known that most of them support the ex-communist party. The

                                                                                           23
only explicit exception is EABG, which has supported the present neo-liberal
government. To some extent, the BIA also diverges from the others, because few years
ago BIA supported a right-centred government (the Christian-democratic cabinet of
Kostov, 1997-2001). The rest 3 employers' umbrellas are connected with the present
socialist party (ex-communist party). Nevertheless, the bonds of these 3 employers'
associations with Bulgarian Socialist Party (BSP) are notably different. For example,
BUPE is formally linked with the party (they conclude political agreements), whereas
BCCI supports it only informally. In its turn UPEE in general still tends to support BSP,
but at present UPEE's leaders show a 'mosaic' background political orientation. In
conclusion, all these 3 employers' organisations have relationships with BSP, but the
binding power and intensity of these relations are different for each of them.
        None of the central employers' associations is especially oriented to the public
sector. On the contrary, since 1990 now all of them have emphasized private sector,
because the very nature of transition in Central and East Europe implies it (above all
restoring the institutions of market and private property). Nevertheless, there are some
substructures related to the public sector22.
                 1)       BIA members:
                    -     National Association of Employers in Healthcare System
                    -     Association of School Directors in Secondary Education
                    -     Union of Employers in Water Supply and Sewerage System
                 2)       BCCI members:
                    - Union of Employers in Public Education System
                 3) UPEE has 20 small municipal administrative units, which cover local
                 public employers in administration. UPEE attempts to unite them in a new
                 branch chamber, responsible for employers in public administration on a
                 broader scale.
        Trying to calculate the number of companies associated with employer’s
organisations, it actually occurs impossible, because of the multiple memberships of
companies. The legislation provides room for such multiple membership and companies
largely facilitate from this. For example, there are companies affiliated to three and even

22
  Here we mention only organisations, which play role in CB, i.e. which are signatory parties in sectoral CA in
public sector.

                                                                                                                  24
four employers' organisations, i.e. one company is counted few times. A large number
of branch structures (branch chambers) are members of at least two or more umbrellas,
too.
           By the same reason (multiple membership), it is not possible to count the share of
the labour force working for the member companies. It means that each of the listed
above 5 employers' associations counts the same companies and the same employees, i.e.
employees of a single company are counted for example 3 times if it is member of 3
employers' associations. Therefore, a more reliable measure is union density, because
multiple trade union membership is not allowed.
           The affiliation of a company to employers’ organisation does not mean this
company will be covered by collective agreement. For example, among the member
companies in Land Transport Branch less than 10% of them conclude company CA23.
That is why the coverage rate of CA is lower than the share of labour force working for
the affiliated companies. Indeed, the member companies prefer to facilitate from the
business services offered by the chambers than to take part in CB. In general, this
attitude to CB is very symptomatic for the EABG – their members refuse to take part in
sectoral CB and refuse to implement the CA signed in the relevant sectors. Moreover,
EABG is the only national employers' association, which is opposed to the extension of
sectoral collective labour agreements.




23
     Source: The Institute for Social Analyses and Policies.

                                                                                          25
TABLE 2: EMPLOYERS’ ORGANISATIONS - institutional characteristics
Note: Estimates of respondents are marked by (*). Source: The Institute for Social Analyses and Policies, last updated in 2003-2004. The data is also validated by the very organisations.
Employers associations→→  →              1. BCCI                               2. BIA                                3. UPEE                               4. BUPE                              5. EABG
Legal status                             NGO, non profit                       NGO, non profit                       NGO, non profit                       NGO, non profit                      NGO, non profit
European affiliation                     Eurochambers                          UNICE                                 ECSB (VV)                             CEA-PME                              -
International affiliation                IOE; ICC                              IOE; ICC                              IOE; ICSB                             WASME                                -
Mandate for CB                           3 years (2004-2007)                   3 years (2004-2007)                   3 years (2004-2007)                   3 years (2004-2007)                  3 years (2004-2007)
Structure of the organisation: by        by region, covering all 28            by region and sector                  by region, municipality        and    by region (at municipal level) and   by region and sector
region/sector/other                      administrative regions in Bulgaria                                          sector                                sector
Type     and     number     of    the    regional chambers - 28                regional - 86; sectoral - 72; other   Regional – 92                         total: more than 20 collective       About 90 collective members
organisation’s corporate (collective)                                          - 17 (miscellaneous members                                                 members                              in all the sectors of economy
members                                                                        like:     cooperatives,    techno-
                                         77 branch organisations               scientific unions)                    19 branch associations                25 sectors and branches covered
Year of establishment and year of        Established     in   1895     and     1980;        re-registered     and    1989                                  1989                                 2000
transformation                           transformed in 1948. After 1989       transformed in 1991
                                         transformed once again
Financing of the organisation (e.g.      Self-financing via: membership        Self-financing via: membership        membership fee, own funds from        membership fee, donations, own       membership fee, donations,
kind    of   contributions,    and       fee (which forms 2% of incomes),      fee, remuneration for services        services;                             funds from services and other        own funds from services and
government subsidies)                    the rest 98% are from services'       offered to members, own funds;                                              legal sources;                       other legal sources;
                                         fees; no government subsidies         no government subsidies               no government subsidies               no government subsidies              no government subsidies
Most common services offered to          Training,     legal   protection,     Training,     legal   protection,     Training,     legal   protection,     Training,      legal  protection,    Training, legal protection,
members by the organisation:             technical support                     technical support                     technical support                     technical support                    technical support
 Number of enterprises represented:       > 42 000                             > 15 000                              >3500                                 > 7000                               > 3000
                              total
Of which SMEs                            91%                                   most of them                          almost all of them                    most of them                         No SMEs
Category of activity                     all possible categories of activity   all possible categories of activity   all possible categories of activity   26 categories of activity but        Large-scale companies in all
                                         in all sectors of economy, but        in all sectors of economy except      in 15 sectors of economy              mainly       in      Construction,   possible categories of activity
                                         mainly in trade and industry          one agricultural branch. All                                                Agriculture, Forestry                in all sectors of economy
                                                                               together it covers 77 branches
Number of employees represented          777 700                               1 500 000*                            77 000                                100 000*                             200 000*
Ability to participate in bipartite      Yes, at all levels                    Yes, at all levels                    Yes, at all levels                    Yes, at all levels                   Yes, at all levels
consultations, negotiations and
signing of collective agreements
Participation        in     tripartite   Yes, at national, municipal,          Yes, at national, municipal,          Yes, at national, municipal,          Yes, at national, municipal,         Yes, definitely at national level,
concertation                             sectoral and branch level             sectoral and branch level             sectoral and branch level             sectoral and branch level            but they are not engaged very
                                                                                                                                                                                                much at sectoral/ and branch
                                                                                                                                                                                                level yet. Moreover, they insist
                                                                                                                                                                                                on CB at company level with
                                                                                                                                                                                                works councils instead with
                                                                                                                                                                                                trade unions. However, works
                                                                                                                                                                                                councils are not spread in
                                                                                                                                                                                                Bulgaria
       2.3.3 The Government


       The state is involved in industrial relations by two reasons: 1) there are
established tripartite mechanisms at national and sectoral/sub-sectoral level – one
National Council for Tripartite Cooperation and many sectoral/branch Councils for
Tripartite Cooperation. Here the government plays the role of moderator; 2) the state is
still a significant owner/employer. The Government takes part in negotiations at central,
sectoral/sub-sectoral level, and at enterprise level.
              a) At national (central) tripartite level, the state is represented by the
Council of Ministers. On behalf of the Government usually partakes an appointed Vice-
Premier. As a supporting body to the Government has been established a special
Secretariat of The National Council for Tripartite Cooperation (NCTC). It has
predominantly logistic function. The name of tripartite body in Bulgaria was changed a
few times but since 1993 it has been called National Council for Tripartite Cooperation
(NCTC). The decision-making process in NCTC is based on consensus. According to
trade unions NCTC has started to work formally within last few years.
       The very beginning of democratic changes was marked by active efforts to
establish tripartite bodies at national level. It was certainly an initiative of the trade
unions. The late 1989 gave start to Talks over the future development of industrial
relations in the light of expected transition. These talks involved initially the communist
government and CITUB. Later the CL 'Podkrepa' joined this first General Agreement in
the new history of Bulgarian industrial relations. It is worthy to note that trade unions
were quite concerned about the lack of strength and representative power of employers’
organisations, since that time the existing employers' organisations (BCCI and BIA)
represented mainly state owned companies. Trade unions were the driving force of IR
under the new social conditions and even supported the establishment of a new
employers' organisation in 1990 in order to constitute tripartite arrangements at national
level. To a certain extent later trade unions also helped the entire process of
reorganisation of employers’ associations. It was a unique and paradoxical experience
but trade unions just wanted to have strong and relevant partners in the tripartite
structures. As a whole, trade unions proved more adequate to the situation of transition
than employers’ organisations. Actually, the past 15 years can be defined as a period of
mutual learning for the social partners.
       Concertation at national level was extremely important in the beginning of
democratic changes. The governments and social partners signed so called 'general
agreements' that certainly helped to keep the social peace and to put some order in a
situation of social implosion and anomie. The agreements at national level have
concerned problems of common interest like: the minimum level of wages in the
country, the compensation against inflation, frames and levels of insurance matters,
relevant legislation initiatives (amendments of the Labour Code, partly Social Insurance
system, and similar). The content of national agreements sometimes treats ad hoc some
acute problems and participants conclude memorandums (for example, measures against
mass spread of short-term labour contracts). Nowadays, a specific round of negotiations
in The NCTC is devoted to so-called National Agreement on the scope and procedural
framework of sectoral or branch collective agreement (SBCA). Such a draft agreement
was elaborated three years ago, but it has not been concluded up to now. All the time one
or another national employers' organisation has been refusing to sign this National
Framework Agreement. Negotiations on this agreement are difficult and obviously,
unsuccessful. The availability of such agreement is a tight requirement for initiating
extension procedure of SCA according to the Labour code. As a result, there is no single
case of extended SBCA over all the companies of the sector/branch. However, most of
the social partners (trade unions in particular) and legal experts find this requirement
unnecessary for the extension procedure.
                     b) At sectoral/branch level tripartite consultations take place in
relevant ministries. A deputy minister or other high official of the ministry is responsible
for tripartite concertation at these levels. A specific item on the sectoral bargaining
agenda has been the privatisation process in the sector (usually it concerns the type of
privatisation procedures, post-privatisation measures like income and employment
policies, retraining, regulation of collective redundancies, compensations, etc.).
However, as a rule, the government has proved to be the player that most often does not
keep promises (obligations) described in agreements and memorandums. It holds for all
the levels of negotiation.
       And last but not least, also as a rule, after the completion of privatisation in some

                                                                                         28
sector, the state gets more or less disengaged - i.e. it withdraws (at least informally) from
the matters of Industrial Relations in this sector. This way the role of tripartite
procedures gradually declines. Fortunately, on the whole, the state has encouraged
bipartite practices.
       As an employer the Government concludes with trade unions CAs, covering
relevant groups of agencies and departments, described further in the present report.
       c) At enterprise level the government is involved in bipartite CB via executive
managers of public utility companies.
              Since 1990 now Bulgaria has had 10 governments. None of them was
nationalist. One of them had communist orientation of a transition type (1989-1990).
Only two of them had officially socialist orientation (1990-1991 and 1995-1997). The
socialist governments were mandates of the Bulgarian Socialist Party (transformed ex-
communist party). Moreover, in 1995-97 the social dialogue was seriously damaged. Up
to now the most effective social dialogue has been proven during the Christian-
democratic government of Kostov (1997-2001). Historians of trade unionism in Bulgaria
say that right-oriented governments have ever been more prone to any dialogue and
particularly to CB, than left coalitions (they also mean periods before WW II). The
present government (2001-?) has a neo-liberal orientation, which is most visible in the
field of economic policy.
       As a whole, there is no connection between the ideological/political orientation of
governments and effectiveness of CB. It is probably due to the fact that in the analyzed
period all the governments had to carry out privatisation and to develop market
economy. This way all the governments had to follow implicitly or explicitly right-
centred economic and political platforms, sometimes contrary to their ideological
believes. The present government is on the right edge of the scale at most. This general
trend caused a semi-regulated deregulation of economy and industrial relations. In the
beginning of changes (1990) Bulgaria started with a neo-corporative model of IR that
gradually has been replaced by a model, which includes increasing proportions of neo-
liberal features. The effects are expressed in few trends:
-      the role of tripartite negotiations and procedures declines;
-      there are visible symptoms of formally carried out negotiations (usually
government imposes decisions);

                                                                                          29
-       there is a shift from national to sectoral level, and afterwards to company level.


        During the period under review surely the state has been getting disengaged. All
the Governments have preferred to get rid of the problems of IR. Yet, the employers and
notably trade unions have ever insisted on state's active participation. In many situations
trade unions have interpreted the state's withdrawing as attempt to escape responsibilities
for some unpopular economic and social measures.




        2.3.4 Other Actors


        The Bulgarian landscape of social dialogue does not display the diversity of actors
existing in some other countries. For example, Works councils are not typical for
Bulgaria. There were only some isolated experiments in a few companies. Employers
(especially 'new' new employers, represented by EABG) would prefer to negotiate with
works councils instead with trade unions since the former will be easily manipulated
than the latter by the very employers at local level. Temporary agencies do not play role
in CB at all because of the fact that they are not spread in Bulgaria.
        Among the supranational actors only European Works Councils (EWC) and
multinationals (MNCs) with supra-national agreements are available in Bulgaria at the
moment. The spread and influence of European Works Councils and the situation in
MNCs were just examined in an empirical survey carried out by CITUB24. The presence
and significance of EWC is still very fragile while MNCs prove strong positive impact
on CB. Let us quote25 the relevant paragraphs of the report:
                 Industrial relations in MNC develop to some extent contradictorily. The
positive trends observed are as follows:
        • In the MNC surveyed the trade union presence is significant. The trade union
density is 67.4% as compared to 20-25% average for the country. The relative share of
CITUB's members is 74,5% and that of Podkrepa CL - 21,4%. The membership in


24
   The fieldwork of the survey was financially supported by ILO - Budapest while the publishing was supported by
Friedrich Ebert Foundation.
25
   Citation here follows the original abstract in English.

                                                                                                             30
other trade unions is 4,1% of the employees in the MNC surveyed. In some MNC the
membership reaches over 90-98% (the subsidiaries of Solvey group, Belgium; American
Standard, USA; CARLSBERG BREWERIES A/S, Denmark). The trade union membership
in the subsidiaries of METRO, Germany is very low (6,5%), but in the last few months
new trade union organisations have been established there. The trade union mem-
bership is stable with new members recruited in some MNC. Some structures have been
lost in the process of outsourcing and sub-contracting.   In   all   MNC    collective
agreements are concluded. As a rule the agreed provisions on remuneration, working
conditions and social benefits are both higher than the fixed in the legislation and
agreed in the sectoral/branch collective agreements. Constructive discussions,
partnership and cooperation and willingness to make concessions characterise the
negotiation process. [CITUB (2004), p. 98].


       The researchers mention some negative practices in MNCs, among which the
following have much common with the issues we are interested in:
       • There is neither normative frame nor practical mechanisms for development of
integral system for workers information and consultation according to the European
practices.
       • In a considerably small number of the subsidiaries the opportunity for
representation in European works councils (EWC) is used. Often that is a result of the
mother company behavior. Only four of the subsidiaries have observers in the EWC
[CITUB (2004), p. 98-99].


       Nevertheless, the authors conclude that:

       As a whole the MNC have positive impact on enterprise development and
restructuring of the economy in Bulgaria. They bring new technologies and know-how,
new managerial skills, new forms of work organisation and working culture.
Nevertheless their role in the transformation of organisational culture and industrial
relations is contradictory. Alongside with the best practices of MNC with head
quarters in the EU countries that transmit the European social values and patterns of
cooperative management and industrial relations, in some MNC attempts to erode the


                                                                                   31
industrial relations have been made and the social dialogue and trade union
organisations became prohibited territories. Expectations after the accession of
Bulgaria to EU are for the creation of more favourable opportunities for the
introduction of the European-social-dialogue practice and the extension of the employee
information and consultation rights as well as more effective participation of the
Bulgarian representatives in the EWC [CITUB (2004), p. 99].




       3. LEVELS OF COLLECTIVE BARGAINING IN BULGARIA
                                                                      Teodor Dechev
       The levels at which collective bargaining takes place are listed in Art. 51 of the
Labour Code. Four levels are exactly pointed - enterprise level, branch level, sectoral
level and municipal level. The participation at any of these levels is not obligatory. The
collective bargaining at each level is regulated separately.
         The mentioned regulations were adopted with the amendments of LC of
  December 1995 and of March 2001. These amendments confirmed some of the
  regulations already adopted in November 1992 and amended others.

       One can argue about the thesis, that there is no legal obligation for participating in
the collective bargaining at sectoral/branch level. Actually, in the LC exists Art. 52,
para.1 with provision which obliges the employers to participate in the collective
bargaining. This text is with no practical value to a large extend, because there are no
obligations for concluding the CA. The negotiations can go on for years on end, if the
employer(s) want to make the trade unions “drive from pillar to post”.
       One may say that there are enough legal provisions, which make the collective
bargaining in Bulgaria obligatory at enterprise, sectoral or municipal level. This is only
the formal part of the analyses. The practice turns out just the opposite. De facto, there is
no any legal obligation to conclude CA while de jure there are some texts in the Labour
Code in this direction. Nevertheless, these texts are not effectively used (i.e. the Law in
force is avoided), so we venture to say that there is not any obligation.
       We do not know a single case, when an employer’s or employee’s
organisation(s), which has violated the “obligatory” one-month term, following p. 1 of

                                                                                          32
para. 1, has been fined or sanctioned for not respecting the legal term. Simply there is no
such a case. We can find out that the situation with the “obligatory” 15 days term,
following p. 2 of para. 1 is just the same.
       On paper the collective bargaining is “obligatory”, but in practice it is not
exercised at all. We can list a number of cases (both at sectoral or enterprise level) when
the employers reject to start negotiations, without any fear that they will be sanctioned
following the requirements of the LC.
       Finally, there is no term for concluding the CA after the negotiations are being
started. There are no sanctions for the employers if they “drag out” the negotiations. If an
employer or employers organisation are inclined in protracting the concluding and
signing of CA (both at enterprise or sectoral level) and to keep perfect conformity with
the LC, it is enough just to start the negotiations in the term, prescribed by, p. 1 of para.1
of Art. 52 of the LC.
       The trade unions are familiar with these employers’ tactics and they prefer
starting real negotiations, instead of pressing the employers with the instruments of Art.
52. The trade unions even prefer criticising the employers in the media for their lack of
good will for starting negotiations, instead of emphasising on the text of Art. 52.
       These are the reasons why the actors of the social dialogue in Bulgaria, do not act
in compliance with the law that obliges the employers to participate in the collective
bargaining at sectoral level.
       Art. 51, para. 1 has not envisaged the possibility for signing CA at national level.
Although, from the point of view presented in (Mratchkov, Sredkova, Vassilev, 2001), p.
134 it is not forbidden, as well. (Such a possibility was discussed in 2000 – 2001, during
the negotiations between the social partners and the legal experts. Finally, this possible
level of collective bargaining wasn’t included in the supplements for the amended LC of
2001). The above mentioned authors insist that it is not violation of the law to pass
collective bargaining at national level. Up to this moment nobody from the social
partners has proposed to follow this extended interpretation of the LC (and specially of
article 50, which gives a definition of the subject of the collective bargaining). That is
why we can conclude that the national level of collective bargaining in Bulgaria doesn’t
exist. The social partners conclude national agreements from time to time, but they are
far away from the subject and the scope (range) of the collective bargaining.

                                                                                           33
       In Art. 51, para. 2 it is explicitly pointed that at enterprise level, branch level and
sectoral level only one collective labour contract could be concluded. This formulation is
not referring to municipal level. In 2001 there was a long dispute, even in the plenary
hall of the National Assembly. Finally, this text was adopted.

       The collective bargaining at enterprise level is arranged in Art. 51a. According to
Art. 51a, para.1,CAs could not be reached unless there is at least one trade union
organisation in the enterprise.
       An important issue is that in the collective bargaining at enterprise level could
take part all trade unions, which are represented at the enterprise. The right to participate
in the collective bargaining at this level does not depend on the presence or lack of
national representativeness of the trade unions.
       The collective bargaining at sectoral/branch level is regulated by Art. 51b LC.
       The fact that there is no legal definition of sector (“otrasal”) and branch (treated
as sub-sector) causes a lot of problems. It provokes disputes about the representativeness
of the employers’ branch organisations and disputes about the frame of the criteria for
national representativeness. Both the national representative trade unions and employers
associations must have a number of branch structures, following the requirements of the
LC. Every time when the procedure for finding out the coverage of the criteria for
national representativeness by the organisations of the social partners takes place, the
government announces the number of the branches and their content.
       Generally, the companies that are engaged in the SBCAs, afterwards sign also
agreements at enterprise level.
       Since 1993, (and much more since 1997), the state has been supporting the
bipartite social dialogue, mainly by training social partners representatives. Such training
was provided in the framework of different projects, including PHARE projects and a
project financed by the ILO. The government as a whole supports the development of
bipartism. To a certain extent the sectoral tripartite councils encouraged and supported to
some extend the process of bipartite SCB. The trade unions are another driving force in
this direction.




                                                                                           34
         The collective bargaining at municipal level is regulated by Art.51c LC. We must
emphasise again, that the municipalities are the only case, when more than one CA
could be concluded.
         It is an uneasy task to evaluate the relative importance of each level of collective
bargaining. In some sectors the collective bargaining at enterprise level is absolutely
dominating, while the sectoral bargaining has got almost zero coverage and importance.
Typical example is the trade sector.




         4.    COVERAGE                RATE         OF      CAs:        SPECIFIC           FEATURES              AND
         DEVELOPMENT
                                                                                   Rumiana Gladicheva, PhD
                                                                         Dept of Sociology, Sofia University


         4.1 Preconditions for shaping the present coverage rate of CAs26


         The Bulgarian system of Industrial relations (IR) and its surrounding legal
arrangements bind strongly coverage rate and union density27 in the sense that coverage
of CAs depends very much on union density (in contrast to France, for example).
         Trade union density has changed dramatically in the course of transition both in
quantitative and qualitative sense. In 1990 Bulgaria started with almost 100%
unionization within the structure of only one single trade union. Of course, under the
communist regime the union membership was an obligation. In this sense our tradition in
contemporary trade union pluralism is very young. At least four factors impacted against
the union density. On the one hand, some of the dimensions of democratization of IR
influenced the density: (1) the announced union pluralism, (2) the announced voluntary

26
   The National Statistical Institute (NSI) is the institution, which delivers the ultimate official data in Bulgaria.
However, the NSI does not collect info about the collective bargaining matters - coverage of agreements, number
of collective agreements etc. Unfortunately, there is no tradition to keep such records at all in the country - i.e.
there is no institution providing detailed and reliable data on this. As a rule, even the social partners in the relevant
sectors have no idea about these quantitative dimensions of the social dialogue. A systematic creation of data base
on these matters was initiated in 2003 by The Institute for Social Analyses and Policies (ISAP). Yet, the data base is
still far from needed comprehensiveness since the process of gathering and validation of info is slow. Giving the
lack of any efforts in this direction in Bulgaria, sometimes (unfortunately) sources are not reliable and The ISAP
has to compare few sources, if available.
27
   By the requirement for sound representativeness enabling trade unions to take part in CB

                                                                                                                     35
membership. The former caused the dispersion of union members into few trade union
confederations. Due to the latter, membership rapidly went down.
        On the other hand, two another factors affected both trade union density and
subsequently – the coverage rate of CAs. The increasing share of the private sector (3),
which does not feel inclined to welcome unionization, contributed to the diminishing of
union density. In addition, (4) the relatively large proportion of shadow economy (and
related illegal employment) appeared a hindrance to union activities. The share of
shadow economy is estimated at about 35% on average in the country.
        As a result the union density has been falling since 1990 now (consequently, it
worsened coverage rate of CAs). At the moment the total union density reaches about
20-25 % average for the country [CITUB (2004), p. 98].




        4.2 Cross-sectoral comparative analysis of CAs' coverage rate


        Fortunately, an amendment of the Labour Code of 2001 gave impetus to the CB at
sectoral and branch level. 'This has led to the development of sectoral bargaining, with
63 new collective agreements signed at this level in 2002-3, covering an estimated 40%
of the workforce' [Markova (2003), p.1]. There are, however, significant differences
between sectors of economy. As a rule, fully privatized sectors consist predominantly of
small and medium enterprises, SMEs (except metallurgy)28, which leads to a worsened
landscape of CB (for example, trade sector, where the coverage of SCA is around 3%).
The coverage rate in private sector is much lower than the country average (17-20% of
employees in private sector are covered as compared to 40% country average). Sectors,
that still remain state-owned and/or labour force in concentrated in big companies offer
much better performance in terms of union density and coverage of CAs (here typical is
electricity sub-sector, 60%). Trade sector and electricity branch can be considered as the
worst and best performance of CB in Bulgaria at the moment. As a rule, small and micro
companies do not have union sections and thus they drop out of CB and coverage of


28
   There are also big privatized companies in other branches of 'heavy' industry like production of cement,
medicines, glass, and chemicals, but as a rule they are owned by MNCs which do not participate in CB at sectoral
level.

                                                                                                             36
CAs. SMEs that are not affiliated to any employers' union are not covered by sectoral
CA because the extension procedure has not worked at all up to now. Moreover, even
those affiliated do not always stick to the SCAs and do not conclude further company
collective agreements (CCAs). It holds especially for micro companies (less than 10
employees), which can't conclude CCA because of the lack of trade union sections.
       In the table below is given data about five important sectors of economy. All
together the selected sectors/sub-sectors comprise about 30% of salaried workers (SW)
in Bulgarian economy. The trade sector employs the largest number of SW in the
country (except public sector). The specificity of textile sector is that it accounts for the
biggest and the most rapidly growing export product of Bulgaria (as well as tourism). On
its part, the Land Transport Branch shows a union density, which is near to the country
average. Moreover, its sectoral coverage rate is close to the country average for the
private sector and in this sense Land transport sector is ideally typical for all privatized
sectors.
       Generally speaking, the coverage rate at company level is much higher than at
sectoral/branch level since some enterprises (mainly MNCs, big private and state-owned
enterprises) sign only CCA. Apart from that, at company level non-unionized workers
are allowed by the Labour Code to join the CA individually. This certainly enhances the
scope of CCAs.




                                                                                          37
TABLE 3: COMPARATIVE DATA ABOUT SOME SELECTED SECTORS

Sector/Subse Number    Union     Coverage of                            Coverage     Share of   Degree of
        29
   ctor         of    density in    CA at                               of CA at     shadow privatisatio
             salaried    the     sectoral/bra                           company     economy*        n
             workers sector*      nch level *                             level*                  (% of
              (SW)                                                                               private
                                                                                               companies)
Electricity,            33,000             60%                55%               58%   No such       37.2%
E.40.1                                                                              phenomen
                                                                                            on
Construction,    100,000                   15%                23%               24%     >40 %       97.2%
F.45
Textile,         170,000                   10%                15%               17%            >33%              99.1%
Leather and
shoes,
DB.18       and
DC.19
Trade,           223,000                    2%                  3%              15%            >45%              99.7%
G.50,      G.51
and G.52
(Other) Land      50,000                   27%                16%               22%            >45%              99.5%
transport,
I.60.2
Country         1,930,00                   25%              40%             No info            >35%              97.2%
average/total          0                                (private
                                                   sector: 17%-
                                                           20%)
Sources: 1) The info about Number of SW and degree of privatisation is provided by the National statistical
        Institute.
        2) The rest of figures in this table is collected in 2003 and 2004 by The Institute for Social Analyses and
        Policies, last updated in 2004. The figures are also validated by the very organisations of social partners.
        Note: Estimates are marked by (*).



        4.3 Public sector


        As a rule the coverage of CAs in the public sector is higher than in the private
one. The very public sector proves divergences, though. For better understanding we
would offer a grouping of the public sector in this way:
        1) Public manufacturing companies. They have relatively high trade union
presence and thus a satisfactory coverage of CAs (for example electricity branch, central

29 The codes of sectors' positions follow the standardized nomenclature of economic activities - NACE.

                                                                                                                  38
heating branch and water supply sector). Moreover, they prove relatively good work
standards negotiated in CAs (salaries, social benefits, job security, workers' rights). And
yet, even within this group companies differ considerably from each other, which
inevitably means some exceptions of the rule.
        2) Public administration. In controversy to manufacturing companies, public
administration is slightly unionized, but the coverage of CAs is high. It includes public
administration at national and municipal level. At top level, separate CAs cover different
Agencies (like National Employment Agency) or divisions of Ministries (like Agency
for Social Assistance at Ministry of Labour and Social Policy). An important role here
plays The Law on Civil Servant, which stipulates imperatively many aspects of labour
relations and thereby does not leave much room for negotiations. Nevertheless, trade
union activities are allowed and collective bargaining exists.
        3) Public services. In the field of public services like education and healthcare,
union density is very high and thus the coverage is more than satisfactory. The biggest
trade union federations are placed namely here. However, the conditions negotiated in
CAs are sometimes worse than negotiated in public manufacturing companies and even
more miserable than in the private sector. A disadvantageous situation is observed in
Public Education, especially in terms of wages. Moreover, in some CAs for public sector
there were negotiated so poor working conditions that are even against the Law. Shortly,
in some CAs are listed clauses, which contradict to the Labour Code, especially with
regard to some rights of parents. The latter was revealed in January-February 2004 in a
survey of the Institute for Social analyses and Policies (ISAP)30. In the course of this
survey were compared via content-analysis more than 70 CAs in force (branch and
company CAs).
        A specific problem in some public utility companies is that the state as employer
oversteps the mark in many directions. For example, in construction and railway sectors
employees do not receive their salaries in time - in some cases there is a delay of more
than 1 year.



30
   The survey is entitled "Attitudes of Bulgarian Employers to women at work". Two of the authors of present
report were also involved in the mentioned survey: Rumiana Gladicheva and Teodor Detchev. The report is under
print in Bulgarian. It is envisaged a broad discussion over the results in December 2004. The discussion will engage
social partners at national level and experts from relevant ministries, MPs as well as some concerned organisations.

                                                                                                                39
        Another point of special attention should be gender discrimination. Generally
speaking, gender discrimination is more transparent in the public than in the private
sector. It is especially true for the payment since it can be measured. Surely women are
less paid in both private and public sector. Yet, another just finished empirical survey in
Land transport sector shows that the gender pay gap is much wider namely in the public
sector31.
        Hence, not always high coverage rate of CAs means good performance. No doubt
that coverage rate is an important indicator but it should be tied to some qualitative
dimensions like the content of CA and especially the value of negotiated clauses. In our
case this contradiction concerns public services sector, where coverage rate is high but
negotiated clauses appear poor. In our opinion it is not success to cover for example 70%
of employees with poor working conditions.




        5. MAIN CONTENT OF THE COLLECTIVE LABOUR AGREEMENTS
                                                                                         Teodor Dechev


        Collective agreements at enterprise level are much more detailed than those at the
SBCAs. At sectoral/branch level the parties bargain and arrange mainly the minimum
possible parameters. On the other hand, trade unions pressure the employers to adopt a
content of the SBCA, which is very close to the agenda of the CAs at enterprise level. It
means that the content of contracts at all levels is getting more and more unified.
        Within the last 2-3 years the social partners agreed on the point that the nationally
representative social partners’ organisations must sign an agreement concerning the
scope, content and procedure of concluding SBCAs. A draft agreement about these
issues was prepared in 2002 by the 6 nationally representative social partners in Bulgaria
(in 2002 two trade union confederations and four employers associations were
recognized as representative), but it was not signed. In 2002 and 2003 the social partners
were not able to conclude the agreement. The conflict point was not the content of
branch agreements, but the attempts of BIA (Bulgarian Industrial Association) and BCCI

31
  The survey was carried out by the Institute for Social Analyses and Policies in June-July 2004 (the report is not
published yet)

                                                                                                                40
(Bulgarian Chamber of Commerce and Industry) to pressure trade unions to agree on a
new round of negotiations for amendment of the LC in a much more liberal direction
(i.e. deregulation). The trade unions did not agree on such kind of “bargaining” and the
proposed bipartite national agreement failed once again. The agreement was not signed
mainly because of the opposition of the BCCI and partly of the BIA, which claims
appeared in the latest phase of negotiations. This way the requirements of the Labour
Code have not been fulfilled for the second time since it was amended in 2001.
       The above mentioned draft agreement (not concluded yet) envisages that the
SBCAs must include at least the following chapters (items): 1. Employment, professional
qualification/vocational training, human resources development and motivation of
workers; 2.Working time, leave, vacations etc.; 3. Health and safety at work; 4. Salaries,
wages, compensations, social payments, social insurance and securities; 5. Trade union
activities in the enterprises of the sector/branch; labour conflicts arrangement and
arbitrage; 6. “Others”.
       This structure of the content of the SBCAs corresponds exactly to that at
enterprise level, which as a rule consists of the following chapters: 1. General issues; 2.
Employment, professional qualification/vocational training; 3. Working time, leave,
vacations, etc.; 4. Salaries, wages and other payments; 5. Health and safety at work; 6.
Social securities and insurance; 7. Trade union activities in the enterprise; 8. Voluntary
arrangement of collective labour disputes; 9. procedure for joining the collective
agreement; 10. Final statements.
       When speaking of sectoral and branch bargaining (SBB) in Bulgaria, we should
keep in mind the specificities of the CAs, which are concluded as a result of the
negotiation process. We can classify the SBCAs, signed in Bulgaria until 2004 in 3
groups:
              -      group one - CAs, signed between the trade unions and the
       employers branch and sectortal organisations;
              -      group two - CAs, signed between the trade unions and the heads of
       agencies (state agencies or executive agencies of ministries) and directorates.
       These contracts cover a plenty of employed all over the country and we consider
       them as SBCAs;



                                                                                        41
             -      group three - CAs, signed between the trade unions and the
       management of single companies (state owned as a rule), which cover with their
       activities whole sectors or branches. An example for such a company is the
       Bulgarian Telecommunication Company (BTC), which has been recently
       privatised. Legally, these agreements are signed following the requirements of the
       Labour Code for the collective bargaining at enterprise level, but the researchers
       of IR in Bulgaria qualify them as SBCAs. This way the branch structure of the
       Association of Democratic syndicates (non-representative at national level)
       appeared as a party in the following CAs in the BTC, “Bulgarian posts” Company
       (its legal status is state owned limited liability company) and in the Commercial
       Bank “Biochim” (at that time a state owned bank with a national wide network –
       now privatised). These CAs were signed as follows: BTC – May 14 2002,
       “Bulgarian posts” – April 27 2002, CB “Biochim” – May 31 2001.
       The research presented is based on a number of SBCAs, concluded in the period
January 1st 1993 – June 1st 2004. The number of the SBCAs, is as follows:
             -      group one – 93 CAs;
             -      group two – 14 CAs;
             -      group three – 28 CAs.
       Identification means that we know the sector (branch) in which the agreement is
concluded, the day of signing of the contract, the term of validity and the parties of the
agreement.
       From the number of identified CAs, were available and surveyed in a details the
texts of:
              -    group one – more than 40 agreements (since January 1999, until May
                   18-th 2004);
             -     group two – 14 agreements (since 1999, until 2004);
             -     group three – 10 agreements (since May 31-st 1999, until June 1-st
                   2004).
       The available and surveyed agreements are mainly from the period after the
amendments in the LC of 2001.
       The research covers the following issues: minimum working salaries for the
sectors/ branches; agreed terms on the annual paid leaves and holidays; conditions for

                                                                                       42
trade union activities; terms for joining the CAs at enterprise level, agreed in the SBCAs;
terms for additional payment and additional social securities for the employees.




       5.1 Minimum salaries and payments


       The date of signing of the SBCAs is given in round brackets. The ratio between
the minimum salary and for minimum payment per hour for the sector and the minimum
salary for the whole state is given in square brackets. Both the minimum salary for the
sector and the minimum salary for the whole state are given in Bulgarian Leva (BGN).
The BGN is fixed to EURO. 1 EURO is equal to 1,96 BGN. The BGN is the official
currency since June 1999.
       In group one (CAs, signed between the trade unions and the employers
sector/branch organisations), the minimum salary is not negotiated only in two cases
– in the Branch CAs for the production cooperatives in agriculture (signed on November
30-th 2001) and in the Branch CLC for tourism (signed on April 1st 2004). From the
other surveyed cases, we have 7 cases, when the minimum payment per hour is
negotiated and agreed and 21 cases, when the minimum monthly salary for the
sector/branch is agreed. The full list of the surveyed branch collective agreements
(BCA), with the minimum salary for the sector and the minimum salary for the whole
state given together with their ratio is given in the appendix.
       In group two (CAs, signed between the trade unions and the heads of
governmental bodies the month minimum salary is negotiated and fixed in all of the
CAs available. Some examples are given in the appendix:
       In group three (CAs, signed between the trade unions and the management of
single companies (state owned as a rule), which cover with their activities whole sectors
or branches) the month minimum salary is negotiated and fixed in all of the 10 CAs
available. The detailed collected data from GROUP 3 is given in the appendix.
       In two cases in group one, in all the five cases presented from group two and in
one case in group three, the negotiated minimum salary for the sector/branch is equal to
the minimum salary established by the state.



                                                                                        43
      The highest ratios between the minimum salary for the sector/branch and the
minimum salary for the whole state are:
             -      from group one - in the Tourist branch (June 13 2001) – [1,765];
      “Water supply, sewage and water processing” branch (October 9 2001) – [1,5];
      Construction sector (February 28 2002) – [1,6]; “Metallurgy and production of
      metal articles” (May 1 2004) – [1,5];
             -      from group three – in the CA for the employees of the Commercial
      Bank “Biochim” (May 31 2001) – [1,53] and in the CA for the “National
      Electrical Company” – state owned joint-stock company (June 1 2004) – [1,6].
      In the other cases the surveyed ratio is fixed in the interval 1,15 – 1,3 as a whole.




      5.2 Agreed terms on the annual paid leaves and rest periods.


      After the amendments of the Labour Code of 2001, the duration of the basic
annual paid leave was envisaged to be not less than 20 work days.
      In the prevailing number of SBCAs, the duration of the negotiated and fixed
additional days annual leave depends on the length of service of the employee.
      In group one, the SBCAs, where the annual leave (holidays) is fixed - 22, without
any dependence on the duration of service. The list of these SBCAs, together with the
negotiated number of days for – annual leave is given in the appendix. In five cases the
number of negotiated days is 20 or “not less than 20”; in 7 - 21; in 8 - 22 or “not less
than 22”; in 2 - 28. The longest annual leave is negotiated at the SCAs of the “High
Schools” sector (May 22 2002) and at the “High Schools” sector (June 1 2004).
      There are 10 SBCA in group one, where a scale for the additional leave is
negotiated. The scale depends on the duration of service of the workers and employees.
The duration of the negotiated annual leaves varies in the range between 20 and 24 days.
The most favourable conditions were negotiated in the BCA for the production
cooperatives in agriculture (November 30 2001), in the “Poultry breeders” branch
(January16 2002) in the “Forestry” branch (January 25 2002) and in the “Forestry”
branch (January 6 2004). The full data is given in the appendix.



                                                                                          44
       In group two there are two CAs, where the annual leave is fixed, without any
dependence on the duration of service - “Not less than 22 days” both in branch
agreement for the employees in the “National Social Assistance”, Executive Agency at
Ministry of Labour and Social Policy (March 21 2001) and in the “Civil defence” State
Agency (May 31 2002), and twelve SBCA for the additional leave which is negotiated.
The length of the latter varies in the range between 20 and 35 days. The full data is
given in the appendix.
       In group three there are five CA, where the annual leave (holidays) is fixed,
without any dependence on the duration of service. The duration of annual leaves varies
from 20 to 24 days. Their list is given in the appendix.
       There are 5 SBCAs in group three, where a scale for the additional leave is
negotiated. The length of the negotiated annual leaves varies in the range between 20 and
25 days. The full data is given in the appendix.




       5.3 Additional social security payments (social insurance) for the employees,
paid by the employer.


       In collective bargaining in Bulgaria is practiced negotiating of additional social
securities (social insurance) in favour of the employees. This practice exists at
sector/branch and enterprise level.
       When analysing this issue we must bear in mind that in Bulgaria is established the
so-called “three pillar social insurance system”. The first pillar is an obligatory “pay as
you go” social securities system. The second pillar is an additional obligatory capital
covering system, which is valid for the citizens born after January 1 1960. The third
pillar is the additional, voluntary social insurance system.
       Here some of typical terms in different SBCA:
          Group one
              -      Forestry branch (January 25 2002) “The employers take the
       obligation to ensure for the workers and employees additional voluntary pension
       social insurance at his expense”;



                                                                                        45
            -    more favourable in both “Cotton, linen and hemp industry” branch
   (February 1 2002) with the addition: “against accident at the work place and
   health insurance”, “The employers will ensure the necessary additional financial
   resources for this purpose” and in “Leather, fur, footwear and leather goods
   industry” branch (February 1 2002) and “Knitwear industry” branch (April 1
   2002);
            -    other examples - “Pulp and paper industry” branch (April 1 2002)
   “The employers may organize additional voluntary pension social insurance for
   the workers and the employees, which are not covered by the obligatory
   additional social securities. The additional securities will be ensured for every
   worker or employee, who wishes and the employer is going to transfer every
   month the necessary security fee – 40 LEVA per person”;
            -    “Processing of fruits and vegetables” branch (April 9 2002) – “The
   employers may ensure additional social insurance”; “Power engineering” branch
   – nuclear power engineering, electricity producing, distribution of electricity,
   centralized heating systems, etc. (June 2 2003) – “if possible the employers are
   going to ensure additional voluntary pension securities”.
      - “Water supply, sewage and water processing” branch (November 18 2003) –
“The employers may assist the workers and the employers in their voluntary pension
social securities and health insurance”.
      Group two
      - Both the Executive Agency “Hailstorm Prevention” (September 12 2003)
and “National Veterinary Services” (March 11 2004)“The employers in the
enterprises, together with the trade unions may negotiate their participation in
additional voluntary pension social insurance”.
      Group three
      - Both “Bulgarian State Railways” Company (May 28 2003) and National
Company “Railway Infrastructure” (May 28 2003)“The workers and the employees
get resources for additional voluntary pension social insurance in an amount of 10 %
from the monthly salary”.




                                                                                 46
          - “National Electrical Company” – state owned joint-stock company (June1
   2004) “The employer ensures at his expense additional voluntary pension social
   securities and health insurance for the workers and the employees”etc.




      5.4 Additional payments for night work, overtime work and Ph. D. degrees


      Additional payments for night work, overtime work and Ph.D. degrees are
traditionally negotiated in the SBCA. The real negotiations are left for the collective
bargaining at enterprise level. Such SBCA appear in group one: Tourist branch (June 13
2001); the system of the Central Cooperative Union (April18 2003) and Tourist branch
(April 1 2004).
      In the prevailing share of SBCA the additional payments for night work and
overtime work are negotiated in a quite detailed way. In the SBCA from group two,
additional payment for overtime work in working days was negotiated only in a couple
of SBCA: Civic administration of the Chief Directorate “Prisons” 50 % for 2002 and
2004. The same situation for both the extra payment for overtime work in Saturday and
Sunday and for overtime work in legal holidays: 75 % for 2002 and 2004, and overtime
work in legal holidays: 100 % for 2002 and 2004.
      As for the additional payments for Ph.D. degrees, they are negotiated in a couple
of SBCA for group one: “National Employment Service” (January 1 1999) – 15250
LEVA per month; Transport sector (March 28-th 2002) – 15 %. For group two the
negotiated additional payments for Ph. D. degrees are given in a table in the appendix.
      In the appendix, detailed information is given about: Additional payments for
night work and overtime work in 27 CA – group one; Additional payments for night
work and Ph.D. degrees in 12 CA – group two; Additional payments for night work,
overtime work and Ph. D. degrees in 8 CA – group three.




                                                                                          47
       5.5 Ensuring acceptable conditions for carrying out trade union activities in
the frame of the sector/branch.


       The overview of the terms agreed in the SBCA shows that for ensuring acceptable
conditions for carrying out trade union activities in the three groups the conditions for
trade union activities are quite acceptable and the violations of trade union rights are
very rare exceptions.
       The terms in the SBCA from group one:
              -     existence of chapter “Ensuring conditions for trade union activities”
                    in the SBCA;
              -     resources for carrying out trade union activities, provided by the
                    employers at their expense;
              -     additional leaves for carrying out trade union activities;
              -     free access to all of the working places for carrying out trade union
                    activities;
              -     right to organise trade union meetings and other activities within the
                    working time.
       As for chapter “Ensuring conditions for trade union activities”, it exists in all of
the SBCA under review. An exception is only the BCA in the “Power engineering”
branch, where formally such a chapter can not be found. Of course, this is a formal
remark, because the “Power engineering” branch is the best example for provision of
conditions for trade union activities.
       The resources for carrying out trade union activities (provided by the
employers at their expense), negotiated in the great majority of the SBCA are: real estate
property, premises, equipment, communication devices, telephone expenditures, copiers,
materials, electricity, furnishing, information. In the different agreements the resources
are envisaged in different ways, but the lists of the resources guaranteed by the
employers are quite similar. Resources for trade union activities are not negotiated in the
collective agreements for the “Production cooperatives in agriculture (signed on
November 30 2001)” and “Production cooperatives in agriculture” (2004). In the CA for
the Tourist branch (April 1 2004), the employers ensure the necessary resources for trade
union activities if possible.

                                                                                        48
       The free access to all of the jobs for carrying out trade union activities is not
negotiated in 20 SBCA. Their list is given in the appendix.
       In all the other 34 SBCA under review, the free access to all of the jobs is
negotiated and guaranteed. The full data on this issue is given in the appendix.




       5.6 Conditions for joining the collective agreements at enterprise level, fixed
       in the SBCA.


       In contrast to the SBCA the collective agreements at enterprise level can not be
extended to non-signatory parties, or even to trade union sections, which have presented
their draft project for a collective agreement from the very beginning, but which have
failed “at the contest” at the general meeting of the employees in the enterprise. (see Art.
51a, para. 3).
       However, there is a clear legal procedure for personal joining of employees (both
unionised and non-unionised) to the collective agreement at enterprise level. The TU
members of organisations, whose draft has failed the competition at the general meeting
of the employees, can join the CA only personally. Joining of entire trade union sections
is not possible. The non-unionised workers can join the collective agreement too, but
they may be asked to pay “solidarity fees” if there is a special fund, established in the
enterprise for this purpose.
       Such a practice for gathering fees from non-unionized workers was a mass
practice until the end of 1992. After that it was quite limited. Even in 1994, in the
Agreement for social peace, signed by the government of Reneta Indzhova and the social
partners, was included an obligation of the trade unions to stop the practice of the
“solidarity fees”.
       There were attempts for gathering such solidarity fees also from the members of
trade union sections in the enterprises, which are not parties in the collective contract. (In
general – these are the members of TU sections, whose draft was not adopted by the
workers’ General Assembly. These attempts caused plenty of conflicts between trade
union structures both at enterprise and national level.



                                                                                           49
       The amendments of the Labour Code (2001), re-established the practice of the
“solidarity fees”.
       The amount of the “solidarity fee” is pointed out in the CA (if such a fee is
mentioned at all) and as a rule is not very big. The trade union ruling bodies advise their
sections in the enterprises to establish acceptable for the workers levels of “solidarity
fees”. A worker who wants to join the collective contract must write down an application
for joining the collective contract and submit it either to the employer, or to a trade union
section, which is signatory party in the collective contract. As far about the funds, where
the “solidarity fees” are gathered, a legal regulation for them doesn’t exist.
       The procedure is effectively used at this level, since it depends predominantly on
the individual employees, who apply for individual joining. They are highly motivated to
join the collective contract otherwise they may receive lower wages or to be excluded
from some benefits, provided by the contract.
       At sector/branch level exists practice for including of terms for the procedure of
joining the CA at enterprise level. In the SBCA from group one, the texts are much more
“general” and as a rule they refer to the collective agreements at enterprise level. But in
the texts of the SBCA from group three, we can find terms, which are far more tangible.
Examples of terms for joining the CAs at enterprise level, included in SBCAs from
group three are given in the appendix.




       6. ROLE OF THE COLLECTIVE BARGAINING IN RELATION TO
       BOTH          TRANSFER      OF     UNDERTAKINGS             AND     COLLECTIVE
       REDUNDANCIES
                                                                Vesselin Ilkov


       Role of the collective bargaining in relation to transfer of both undertakings and
collective redundancies is currently weak in Bulgaria, if any. From the collected data for
the concluded collective agreements at different levels in Bulgaria, is quite evident that
these issues are either not regulated at all, or are envisaged in few clauses in scattered
CAs. Those clauses transmit to the provisions of law concerning these relations, for
example: in Art.2.4, para.1 from Collective agreement in “Кremikovtzi” Limited

                                                                                          50
company of June 2004 is envisaged in cases of collective bargaining according to law,
the employer to notify the trade unions, in compliance with the requirements of Art.130а
LC, and § 8 which envisages, that in event of change of the employer, restructuring of
the company related to parting (merger) of attendant productions (activities) the status
quo collective agreement has effect by the conclusion of new collective agreement but
not longer than one year from the date of change of the employer.
      Another example, is the Collective agreement concluded on 15 March 2004 in
“Shumensko pivo” Limited company, which Art.18 states: the parties have reached an
agreement that the Employer takes decisions to close up activities, partial liquidation,
reduction of the volume of work or other structural changes leading to closing down of
jobs over 10%, only after elaboration of a new structure and programme for employment
of the employees in the company and provides this documents before the trade union for
opinion which should be given to the employer in term of 7 working days following the
providing of documents. From these two examples becomes evident that collective
bargaining still is not well developed as regards the protection of employees in event of
transfer of undertakings and collective redundancies. Related to this, the most logical
explanation for lack or insufficiency of the regulation in CAs of those types of relations
could be the comparatively new legislation in the field. The recent legislative
developments will be reviewed briefly set forth below.




      6.1 Legislation


      6.1.1 Transfer of Undertakings


      The legislation concerning “transfer of undertakings” and other consequences for
the labour relations related to the change of employer is regulated in Art.123 of the
Labour Code. In the first version of the LC of 1986 instead of the “employer’ was used
“enterprise”. The explanation is that in the socialist society the only employer was the
State. Furthermore, the legislation of “Preservation of the labour relationship in case of
reconstruction of a company” of 1986, in force till the amendments of 1992, was limited
– it comprised only three cases - at merger of undertakings; at part of undertaking to

                                                                                       51
another one and in case of distribution of operations of one enterprise among several
enterprises. With the amendment of LC of 1992 the circle of the employees’ protection
was widened with the following new hypotheses: in case of joining of one enterprise
with another in case of transfer of an autonomous part of one enterprise to another; in the
event of change of the owner of the enterprise or of an autonomous part thereof and in
the case of delivery of the enterprise or an autonomous part thereof for rent, on lease or
under concession. Also was extended the scope of the obligations of the employer
connected with informing of the employees or their representatives for the envisaged
changes and possible legal, economic and social consequences for the employees. This
amendment of the LC as well as the next one of June 2004, which provided that the
employer is obliged before the notification for the changes to convene in due time
consultations and to lay efforts to reach an agreement with the representatives of the
syndicate Organisations and with the representatives of the employees, achieved full
compliance of the Bulgarian labour legislation with the requirements of the EU labour
law envisaged in Directive 2001/23/ЕC.




      6.1.2 Collective redundancies


      The regulation of the collective redundancies comprised in two legislative acts –
the Labour code and the Law on Employment Promotion. For the first time collective
redundancies were introduced with the adoption in 2001 of the new Art.130а LC,
stipulating the right to information in event of collective redundancy. According to this
provision in case, that the employer intends to undertake collective redundancy, he/she
shall be obliged to undertake consultations with the worker and employee representatives
timely in terms and conditions set in the CA. In that case, he/she should provide
information on five points: the reasons for the forthcoming redundancy; the number of
the workers and employees, who will be discharged and the basic economic activities,
qualification groups and professions to which they refer; the number of the occupied by
the basic economic activities qualification groups and professions in the enterprise; the
envisaged criteria for selection of the workers and employees, who will be discharged
and the time, during which the redundancy will be done.

                                                                                        52
      Now, a full compliance is achieved with the requirements of Directive 98/59/ЕC.
In Art.24 and 25 of the Law on Employment (SG, No 26 from 2003,amended., No 52
from 2004) was regulated the procedure for information in case of collective
redundancies. Art. 24, para.1 envisages that Employers shall notify, in writing and 45
days before the date of redundancy, at the latest, the sub-division of the Employment
Agency and the representatives of the workers and employees in the enterprises about
their envisioned collective redundancies. The teams envisaged in Art. 25 consisting of a
representative of the employer, representatives of the employees’ organisations at the
enterprise, a representative of the sub-division of the Employment Agency, and a
representative of the municipal administration, are of a big practical importance. Their
main task is to prepare projects for the measures necessary and targeted at:


             1. Intermediation for employment;
             2. Training for the acquisition of professional qualification;
             3. Start-up of an independent economic activity;
             4. Alternative programmes for employment.
      According to the functions of these teams the role of the social partners shall be
very important. As regards the very recent introduction of this provision outcomes of its
implementation are not registered yet.




      7. INFLUENCE OF EUROPEAN LAW ON NATIONAL COLLECTIVE
       BARGAINING
                                                                     Vesselin Ilkov


      The influence of European law upon the national collective bargaining has been
significant and with the more important role every next year since the beginning of the
negotiation process of Republic of Bulgaria towards accession to EU set in 2000. But
beforehand we think is necessary to specify which aspect of European law we consider
important within the framework and goals of this report. For the purposes of this report
we analyse the influence of European law (primary and secondary) which deals with
issues of tripartite social dialogue or national collective bargaining. From the former we

                                                                                       53
consider the principles implied in the Common European Act, the amendments made
with Treaty of Maastricht (Articles 137-139) and the Protocol 14 for the social policy
and the Social Policy Agreement by which all Member States expressed their
determination to observe and apply the Social Charter of 1989 on basic social rights of
employees; from the latter these are all EU legislative acts (primary Council directives)
which requirements are related to observing the principles of information, consultation
and negotiation of the national both legislative and administrative measures. Of course,
the European integration of Republic of Bulgaria towards European union, undoubtly
was the main impetus for change and development as regards the structure and methods
used within tripartite social dialogue but it is also true that all players in the national
collective bargaining process had been realised even before that that the social dialogue
is the driving force behind successful economic and social reforms.32
          This influence has been displaying mainly in three interlinked directions.
          The first – in introducing into Bulgarian social dialogue system a good
functioning models of European social dialogue specialised bodies. One good example
is the Economic and Social Council which was set up in 2003 as a consultative body,
expressing the will of the civil society structures in the economic and social
development. The structure, functions and the activity of the Council are regulated in
Law on Economic and Social Council (promulgated, SG, No 41 of 2001, amended and
supplemented, No 120 of 2002, amend. and supplemented, No 20 of 2003) It is a
permanent institutional form of the social and civil dialogue and the consultations on the
economic and social policy between the government and the structures of the civil
society. The establishment of the Council is considered as completing Bulgaria's social
dialogue system reform. The model was directly received from the consultative
institution with the same title at European level. The institutional building in the field of
the national collective bargaining have a bit longer tradition which had started with the
establishment in 1993 of the already presented in part one of the current report National
Council for Tripartite Co-operation. The tripartite concertation was regulated for the
first time in our labour legislation in Labour Code Art.3 and secondary legislation acts in




32
     COM (2002) 341 final

                                                                                          54
1992. Later, some other bodies for national collective bargaining were established, the
most important of which are following:
      - National Council for working conditions (NCWC) in which participate
representatives of the representatives of the national representative employees’ and
employers’ organizations, together with representatives of the government. NCWC is
chaired by the Minister of Labour and Social Policy, deputy chairpersons representatives
of the social partners organizations. Decisions are taken with consensus and
         - National Council on Employment Promotion which was set up in 2002 at
 the Minister of Labour and Social Policy pursuant to Law on Employment.



      The second – in developing and strengthening already present co-operation and
partnership between the social partners’ organisations and the State, following the model
of co-operation provided in Articles 137-139 of the Treaty of Maastricht. In relation to
the process of eurointegration, under CM Decree No 33 до 11.02.2002 on Organisation
and Co-ordination of the Preparation of Republic of Bulgaria for Accession towards
European Union and Carrying out of accession negotiations (Prom., SG, No 19 of
19.02.2002, amended and supplemented)        were set up working groups. Their main
function, is to give an expert opinion from the EU law requirements point of view to the
whole mainstream of drafts of legislative acts (primary and secondary), national
strategies, plans, etc. In the working groups both experts from the social partners’
organizations and governmental bodies have been participating in an equal footing. As a
good example can be given working group 2 “Free movement of workers” and working
group 13 “Social policy and Employment”, both of which are in the portfolio of the
Minister of the Labour and Social Policy.


      The third direction of this influence has been manifested in a progressive
improving of the legislation of the social dialogue in Republic of Bulgaria. Some of the
main developments in the legislation we enlist bellow:
      1998 - Adopted Ordinance on the Procedure for Ascertaining the Presence of
Criteria for Representation of the Employers’ and Employees’ Organisations
(Decree of CM N 41 of 1998, promulgated, SG, N 22 of 1998) ascertaining of the

                                                                                      55
presence of the criteria for representation performed on the ground of data regarding
employees’ Organisations party to collective labour agreement, registered according to
the relevant procedure which is concluded in within commercial companies and other
undertakings and Organisations under the Labour Code;
       2001 – The amendments and supplements of the Labour Code by which a detailed
regulation and legal definition of the social dialogue and collective bargaining were
reached, as well as establishment of mechanism, by which social players would
gradually take their responsibilities and obligations (Art. Art. 2, 3, 3a, 3b, 3c, 3d, 3e, 3f
of the Labour Code); The National Council for Tripartite Co-operation approved Rules
on the organisation and activities of the Councils for Tripartite Co-operation
(Promulgated, SG, N57 of 2001) with which was regulated the organisation and the
activities of the National Council for Tripartite Co-operation, of the sectoral/branch and
municipal Councils for Tripartite Co-operation These Rules regulate the organisation
and activity of the NCTC, as well as of other Councils for Tripartite Co-operation; The
same year Art. 4 of Law on Settlement of Collective Labour Disputes was amended,
and it was envisaged that at the Minister of Labour and Social Policy should set up
National Institute for Mediation and Arbitrate (NIMA). NIMA was built on tripartite
principle. The management organs of the institute are Supervisory board and Director. In
the Supervisory board take part representatives of the State, of the representative
employees’ and employers’ Organisations. The main activity of the institute is mediation
and arbitrates for settlement of collective labour disputes.
       2002 – In relation to the recommendations in the Regular Report of the EC of the
progress of Bulgaria – 2002 as regards the social dialogue the National Assembly
adopted the Law on Amendment of the Labour Code (prom., SG, No 120 of
29.12.2002) with which was further developed the tripartite co-operation, social dialogue
and collective labour bargaining. With the abovementioned amendment of the Labour
Code were established clear criteria for terms and conditions for forming of the areas for
tripartite co-operation and for the representation of the national representative
employees’ and employers’ Organisations.
       In implementation of the regulated in the Labour Code new requirements
regarding the recognition of the representation of the employers’ and employees’
Organisations Decree of CM 152 of 11 July 2003 (promulgated, SG, No 64 of 18 July

                                                                                          56
2003) the Ordinance on The Procedures for Identifying the Presence of Criteria For
Representation of Organisations Of Workers and Employees and Organisations of
Employers was adopted. On the basis of this act started the procedure for recognition of
the representation of the social partners’ organisation by submitting the relevant
documents.
       The social partners in the tripartite bodies at national level have been participating
in the consultations on the elaboration and implementation of the Employment policy
and education for acquisition of professional qualification. They also have suggested
and participated in elaboration of new programmes.
       The role of the social partners in elaboration and implementation of the State
policy for employment promotion has also increased.            Employment Strategy and
National Action Plan for Employment 2004 were elaborated on the basis of social
partnership. Programmes, projects and measures from the Plan are being elaborated and
implemented with the participation of employers’ and employees’ organisations and
NGOs.
       Annually, after consultations with the social partners, are specified the new
minimum amounts of the social security income, by economic activities and professions,
and they are included in the Law on budget of the State Social Security for the relevant
calendar year.




       8. TRANSPOSITION OF EUROPEAN DIRECTIVES AS A PART OF THE
       NATIONAL COLLECTIVE BARGAINING NEGOTIATIONS.
                                                                      Vesselin Ilkov


       The transposition of EU directives is a complex process in which have been
participating in an equal footing the State and both employees’ and employers’
representative organisations at national level. According to Art.3 LC drafting of the
legislative measures (laws and secondary legislation) related to labour relations and the
immediately related relations, the social security relations, as well as the living standard
issues, is carried out in cooperation and after consultations with the employees' and the
employers' representative organisations. The transposition of EU directives into national

                                                                                          57
normative acts is part of the well-established tradition of trilateral co-operation. In the
consultative forums already presented in the previous part of the report have been
elaborated all the newly adopted legislation (laws and secondary legislation) transposing
the EU law in the field of social policy. Further, in a conscise overview will be presented
the major national acts which have transposed the EU acts in through consultations in the
main tri-partite bodies by 2004:

       - Primary legislation - the Law on Amendment of the Labour Code (all the
amendments of 2001, 2002 and 2004 concerning almost all directives in the field of EU
labour law as: 91/533/EEC, 92/85/EEC, 93/104/EC, amended with 2000/34/EC –
consolidated with 2003/88/EC, 94/33/EC, 96/71/EC, 97/81/ЕC, 98/59/EC, 99/70/EC and
2001/23/ЕC, and two directives in the field of gender equality 92/85/EEC and
96/34/EC); Law on Employment Promotion (amendments of 2002 and 2003 concerning
information in case of collective redundancies within the requirements of Directives
98/59/EC and Directive 96/71/EC); Law on the Guaranteed Workers’ Claims in
Employers Insolvency (transposing the Council directive 80/987/EEC) etc.;

       - Secondary legislation – a number of Ordinances in the field of Labour Law,
Safety and Health at Work, Public Health (tobacco directives), Social dialogue and
Equal Opportunity for Men and Women sectors.

       The Economic and Social Council has been also operating effectively as a tool for
consultation of the newly transposed EU law into the national legislation. It has already
delivered opinion on the implementation of the European Social Charter (revised).




       CONCLUSIONS


       The tripartite cooperation system, as well as the bipartite social dialogue in
Bulgaria are very well developed in terms of their institutionalization. Many foreign and
domestic researchers cite Bulgaria as one of the leading countries in the field of tripartite
and bipartite institutional building in Central and Eastern Europe. In the transition period
(1989 - 2004), both the tripartite and bipartite practices notably contributed to the
preservation of social peace (and the ethnical peace, too) in Bulgaria. The social

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partnership acted as a kind of 'political school', not only for the representatives of trade
unions and employers' associations, but also for the persons involved in the executive
power. As a whole, the development of social partners' organisations is positive. Such
positive evidence concerning the employers' organisations is the increasing number of
employers' branch chambers, which have appeared in many sectors and branches. In
regard to trade unions a positive trend is their growing experience and accumulated
expertise. Nevertheless, there are few important setbacks related to the organisational
status of both workers' and employers' organisations. A weakness of trade unions is the
recent trend of shrinking membership, which impedes the coverage of CAs. It is due to
several objective factors – mainly, the structural reform of economy and the relevant
process of privatisation; the increasing number of self-employed; the domination of
SMEs and self-owned companies; and the relatively high share of shadow economy. In
many enterprises, the new employers have prohibited the unionisation (of course, it is
against the Law). Employers' organisations will also have to overcome some
unfavourable trends. In general, employers are much more fragmented than trade unions,
that certainly reduces their real representativeness at sectoral level. As a result, their
prestige in the eyes of their own members, trade unions and broad public has been
disrupted.


       The legislation, which arranges collective bargaining in Bulgaria is well-
developed, even optimized. It guaranties the voluntary character of the collective
bargaining and canalizes its procedures. An immense experience in collective bargaining
and concluding collective agreements has been accumulated during the last 15 years.
This fact compensates the lack of National Agreement on the contents of sectoral/branch
agreements. De jure, The Labour Code stipulates such a National Agreement as
necessary precondition for many others steps in the field of Industrial Relations (for
example, the application of extension procedure). A draft project of such National
Agreement was elaborated about three years ago, but it was not concluded due to the
obstructions of two among the representative employers' associations. De facto, despite
the lack of the mentioned National Agreement, a well-developed good practice has been
established. The social partners practically developed a unified content of sectoral and
branch collective contracts. The recent series of these collective agreements, concluded

                                                                                         59
in 2003-2004, gave grounds for optimism with regard to the implementation of new best
practices in collective bargaining. These practices are mainly in the field of employment,
health and safety at work, and labour productivity.


       The tradition of union pluralism was interrupted in the middle of 20th century for
almost fifty years (under the communist regime). In early 1990s Bulgaria started to
restore it, thanks to the options provided by democratic transition. Trade unions were
very strong in the beginning of democratic changes in terms of membership and
public/political influence. Since 1990 now the membership has rapidly gone down as
well as the level of influence. In 2003 the union density in the country was about 25% on
average, tending to decline slowly further.


       The established procedure for measuring of social partners' representativeness is a
positive fact in the Bulgarian system of Industrial Relations. The status of 'nationally
representative player' is the key to participation in collective bargaining at all levels,
except company level. The regularity of counting procedure, combined with legally
stipulated objective criteria, guarantees the stability of players' configuration for a period
of 3 years. It also helps the consolidation of social partners and partly prevents against
their fragmentation. In 2004, some changes took place in the industrial relations'
landscape of Bulgaria. A new actor appeared on the scene – an employers’ organisation
of the big business – the Employers’ Association of Bulgaria (EABG). The EABG
articulated clearly its position on CB. They want to focus collective bargaining at
enterprise level and appeal for establishment of works councils at the expense of the role
of trade unions. For EABG the works councils are more a trade union alternative, rather
than a second channel of workers’ representation/participation. In other words, EABG
would like to reduce and limit the trade unions' presence and influence.


       Tripartite concertation is traditionally strong in Bulgaria and it takes place at all
possible levels of negotiation. However, it has been more relevant and effective at
national level. A specific matter is related to the employers’ attitudes towards
participation in tripartite and bipartite procedures. They are more inclined to take part in
the sectoral and sub-sectoral tripartite councils, than in the bipartite sectoral/branch

                                                                                           60
collective bargaining. In their opinion, the reason is very simple: the Councils give them
more scope for lobbying in many business directions, while the collective agreements
bring them predominantly harder obligations and responsibilities.


       Unfortunately, there is substantial disproportion between the (high) level of
institutional building and the real efficiency of functioning of tripartite cooperation and
bipartite social dialogue. The social partners complain more and more about the formal
functioning of the tripartite institutions. Yet, any impression that there is a shift from
tripartite practices to bipartite social dialogue is somewhat misleading. Indeed, the role
and the 'weight' of bipartite sectoral/branch collective bargaining is growing relatively,
but not absolutely (i.e., only at the expense of tripartite ones). That is, the importance of
sectoral and subsectoral (branch) collective bargaining grows as a consequence of the
slow, but permanently       fading effectiveness of tripartite institutions – the National
Council for Tripartite Cooperation and the sectoral/branch tripartite councils. At the
same time, there is neither uncontested expansion of the range of sectoral/subsectoral
collective bargaining, nor significant increase of the number of branches/sectors covered
by collective agreements.


       There are visible discrepancies between the coverage rate of collective
agreements in the different sectors and branches. The research findings of the authors
show that the lowest coverage in 2003 was in the Trade sector, while the highest was in
the Electricity branch. Though, this favourable situation in electricity sector most
probably will be changed soon, because of the expected privatisation. The Land
transport branch could be considered as ideally typical for the private sector in Bulgaria
in terms of union density and coverage of collective agreements. The coverage rate of
sectoral collective agreements reaches at about 40% of the workforce (country average).
The coverage rate at company level is higher since firstly, big companies and MNCs
conclude only company collective agreements, and secondly - the extension procedure at
company level is more flexible than at sectoral level and thereby proves more efficient.
The extension at company level depends only on the will of individual workers who are,
in general, highly motivated to join the local collective labour contract.



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       The biggest problems are connected with the extension procedure of
branch/sectoral collective agreements. The necessary legislation to apply such a
procedure exists, but any extension has not taken place up to this moment. The good
news is, that within last months the trade unions and four out of the five representative
employers’ organisations got closer in their views to the extension procedures.


       With regard to dominant levels of collective bargaining in Bulgaria a
contradiction between two streams is being shaped. On the one hand, the EC priorities
are prone to sectoral level, while the natural evolution of industrial relations leads to
company level. On the other hand, it appears to be of great importance, how the social
partners in Bulgaria will reply to this contradictory situation. For sure the new player in
the field of CB - EABG - will defend by all means its policy, oriented to company level.
Because the most important decisions in Bulgaria are based on consensus, if EABG
prove steady positions in the future, it may confront the European preferences given to
sectoral level.


       The social partners in Bulgaria are quite experienced acting at European level,
thanks to their affiliation to the European social partners' organisations is concerned. The
trade union confederations (The CITUB and The 'Podkrepa' CL) are members of ETUC.
In their turn, the employers are also affiliated to European structures (The BIA is
member of the UNICE, The UPEE applied officially for membership in the UEAPME,
and The BCCI is member of Eurochambers). The representative organisations of the
social partners in Bulgaria are also members of other European and World organizations.
At sectoral level the membership of Bulgarian branch organisations – trade unions and
employers – is much more modest, but nevertheless, the scope is satisfying on the given
conditions at this stage of development. Such affiliations are bridges for transferring of
European industrial relations' culture. Yet, up to now trade unions have been more
interested in affiliation to European sectoral federations than employers. The number of
sectoral/branch trade union federations, which are members of relevant European
structures, is few times higher than the number of employers' sectoral associations
affiliated. Another channel for positive impact from abroad is the spread of supranational



                                                                                         62
actors. The presence and significance of European Works Councils is still very fragile
while MNCs prove broad and notably positive impact on CB.


      The accession to EU will certainly enhance the role of the collective bargaining.
The leaders of the social partners’ organizations at national and branch level are familiar
with innovations in industrial relations in the EU countries. They watch closely the
development of the European social dialogue. Unfortunately, there is a gap between the
knowledge and the implementation of the innovative practices. For example, the social
partners are quite familiar with the Telework agreement. They highly estimate its merits
and importance as a precedent in the EU industrial relations – the first agreement at EU
level, which is meant to be implemented on voluntary basis and will be not transformed
into European directive. The existence of the Telework agreement is often used in the
debates on the problems of collective bargaining. However, this agreement could not be
implemented in Bulgaria yet, because as a whole the 'teleworkers' are not unionized.


      In some cases, the government is inclined to adopt norms and legislation, which
reinforce the role of bipartite practices. Such a case is the establishment of so-called
'social securities thresholds' – a bipartite procedure, which sometimes is transformed into
a tripartite one. In general, none of the governments has been hostile towards the
branch/sectoral collective bargaining up to this moment. The government remains quite
sceptical only about the extension of branch/sectoral collective agreements.


      As a whole, there is no connection between the announced ideological/political
orientation of governments and the effectiveness of collective bargaining. It is probably
due to the fact, that in the analyzed period all the governments had to carry out
privatisation and to develop market economy. This way all the governments had to
follow implicitly or explicitly right-centered economic and political platforms,
sometimes contrary to their ideological believes. With regard to political orientation of
social partners in Bulgaria there is a paradoxical fact: up to now trade unions have
supported right-centered political formations (and respectively, governments) while most
of employers' organisations have supported The Bulgarian Socialist Party (the
transformed ex-communist party).

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       Despite all the significant and positive changes, which happened in the field of
industrial relations during the last 15 years, the social partners (especially trade unions)
remain more or less sceptical about the future developments. Their scepticism is rooted
in the visible gap between the (high) level of institutionalization and the relatively low
effectiveness of the institutional mechanisms of the social dialogue in Bulgaria. In this
sense, probably the social partners will have to design some changes in order to achieve
a more fluent and more efficient functioning of the social dialogue's machinery.




REFERENCES:


CITUB, 2004. Multinational Companies – challenges to IR and trade unions: five years
       later. Sofia (in Bulgarian, accompanied by an abstract in English)
Communication from the Commission, 2002. The European social dialogue, a force for
       innovation and change, Brussels, 26.6.2002 COM, 341 final.
Communication from the Commission, 2004. Partnership for change in an enlarged
       Europe – Enhancing the contribution of European social dialogue, Brussels,
       12.8.2004 COM, 557 final.
Gladicheva, R. 2004a. Paradoxical Culture of the social dialogue in Bulgaria (1989-
       2004). Sofia (in Bulgarian)
Gladicheva, R. 2004b. Contemporary Bulgarian model of industrial relations and West
       European models (comparative analysis). In: Bulgaria and EU accession: tripartite
       cooperation and development of industrial relations. IRMI, supported by Phare
       Access 2000, Sofia (in Bulgarian)
Gladicheva, R. 2003a. Opportunities for regulation of labour market in Bulgaria: a case
       study. In: Integrating Transition Economies: the case of South-Eastern Europe.
       Sofia University and University of Leipzig (in English).
Gladicheva, R. 2003b. Flexible employment: regulated or non-regulated deregulation of
       the Labour Market. In: Flexible employment and problems of its regulation.
       Plovdiv (in Bulgarian)



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Gladicheva, R. 2003c. (co-author: Detchev, Teodor). Employers' organisations in
      Bulgaria and their participation in the social dialogue at sectoral and branch level.
      IRMI, supported by Phare Access 2000, Sofia (in Bulgarian)
Gladicheva, R. 2003d. History of Tripartism and some West European models of
      industrial relations. In: Tripartism. IRMI, supported by Phare Access 2000, Sofia
      (in Bulgarian)
Gladicheva, R. 2002. New Faces of Work. (ed). Volume 1, IK Kota, Sofia (in Bulgarian)
Institute for Social Analyses and Policies. Archives, surveys and data base.
      Labour Code. Versions: 1986; 1992, and 2001 (amended).
Markova, E. 2003. Sectoral collective bargaining develops. In: www.eiro.eurofound.ie, 5
      Jan 2004, Id:BG0312203FBG.DOC
Markova, E., 2004. New agreed terms in the sectoral and branch collective agreements,
      Sindi Trud, No., Sofia, CITUB.

Mratchkov, V., Kr. Sredkova, At. Vassilev, 2001. Comments on the Labour Code, Sibi
      Publishing House, Sofia.

Neykov, G. Guergiev, V. Vassilev, 1992. Labour Code and the collective agreement,
      Sofia.




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