22 Mar Compass for employers
The employment relationships in times of crisis
21.03.2020
Author: Doychin Ivanov, attorney-at-law
On 13.03.2020 due to the COVID-19 outbreak by virtue of a Decision of the Bulgarian National Assembly the members of the parliament introduced State of emergency.
Under specific Order of the Health Minister shops, restaurants, gaming halls and other public places, on which usually many people gather have been closed. In the name of limiting the spread of the disease restrictions of the right of free movement and gatherings on public places have been imposed. The public authorities advise all citizens to stay at their homes and go outside only in absolutely urgent cases.
On 20.03.2020 the National Assembly adopted special Act on Measures and Actions in Times of the State of Emergency, Declared by Virtue of a Decision of the National Assembly dated 13.03.2020. (the State of Emergency Act)
By approaching much more closely the eye of the storm we begin to realize that the disaster endangers breaking the economy’s bones and thus depriving the active people of the opportunities to earn their living.
In such unprecedented crisis many employers are facing fundamental questions regarding optimization of the employment relations in their enterprises.
In the same time, although still being an exception, the opposite cases are relevant as well. There are companies and businesses which need more employees and more working hours. These are grocery stores, drug stores, pharmaceutical companies, producers of hygiene and protective gear, companies providing courier services, companies operating in the field of e-commerce etc.
Due to the above said we summarize hereunder the available options before the employers in both directions.
In brief the options standing before the employers are:
- State aid for the employers (60 % of the employees’ salaries)
- Work at home
- Remote work (home office)
- Granting the annual paid leave without employees’ consent
- Unilateral change of the place and character of the work
- Part-time (shorter working hours, but not less than 4 working hours)
- Flexible working hours
- Unpaid leave
- Dismissals
- Open-ended working hours
- Overtime work
- Rights and obligations of the employees
The implementation of each option enlisted above is related to thorough analysis of the concrete particularities and conditions of every specific case and therefore we encourage you before undertaking any of them to consult legal specialist and receive all necessary documents prepared in line with the legal requirements.
In the opposite case and in case of unlawful actions by the employers they risk heavy fines imposed by the General Labour Inspectorate Executive Agency, as well as cancellation of their acts by the court and obligation to pay compensations in cases initiated by the employees.
I. State aid for the employers (60 % of the employees’ salaries)
Under the State of Emergency Act (§ 6 of the preliminary and supplementary provisions) the employers shall be entitled to receive state aid via the National Social Security Institute in the amount of 60 % of their employees’ insurable income for January 2020 for the period of duration of the State of Emergency, but not longer than 3 months.
The Council of Ministers is due to issue the concrete rules for granting the aid in short time. The employers will be able to submit their applications for the aid with the divisions of the Employment Agency.
In case the employers do not supplement the rest of 40 % and do not pay to their employees their due salaries in full, then the employers will have to return back to the state all granted amounts.
II. Work at home
Under Art. 107b of the Labour Code (LC) the parties to the employment contract (employer and employee) may agree that the performance of the employee’s duties in relation with production of goods and/or provision of services shall be performed at the employee’s home or other preferred premises by him.
Under the State of Emergency Act (Art. 7 and § 4, point 1 of the preliminary and supplementary provisions) now the employers are entitled to introduce such form of work even without the employees’ consent.
In the present State of Emergency the employers are entitled to determine unilaterally by a written order the conditions, the procedure for assignment and reporting of the performed work by the employees, as well.
In these cases the work is performed with employee’s or employer’s equipment, materials or other subsidiary means.
The employees, who perform work at home decide on their own the beginning, the end and the distribution of the working time within the statutory duration, as well as the rests during the working day, the uninterrupted rest between work days and weeks. For these employees the rules for the overtime do not apply.
III. Remote work (home office)
Under Art. 107h of the LC the work in the regime of home office is a form of work organization, which is outsourced outside the employer’s premises and which is performed via information technologies.
Again, similarly as to the regime of work at home under the State of Emergency Act (Art. 7 and § 4, point 1 of the preliminary and supplementary provisions) the employers are entitled to introduce such form of work even without the employees’ consent.
In times of State of Emergency the employers are entitled to determine unilaterally by a written order the conditions, the procedure for assignment and reporting of the performed work.
The employer is obliged on its own account to provide the employee with the necessary equipment, consumables, programs (software), technical support and maintenance, communication tools, including Internet connection, data protection etc.
The employees, who work in the regime of home office in return are responsible for the proper maintenance and use of the provided equipment. The employees are obliged to inform the employer without delay in case of equipment’s failure or collapse of the used information and/or communication systems.
The working time in the regime of home office corresponds to the working time, which is established for the employees, who work in the employer’s premises.
IV. Granting the annual paid leave without employees’ consent
Under the State of Emergency Act (§ 4, point 4 of the preliminary and supplementary provisions) the employer is entitled to grant the annual paid leave to the employees even without their consent in the cases where due to declared State of Emergency the activity of the employees was suspended under explicit instructions of competent authority or under an order issued by the employer for suspension of the work of the whole enterprise, part thereof or of the work of specific employees. Upon their request the employer is obliged to allow the use of the annual paid leave to some more vulnerable categories of employees, as well.
Furthermore, under Art. 173, Para 4 of LC the employer is entitled to grant the whole unused annual paid leave to their employees in the following specific cases: 1/ in case of more than 5 days of idle time; 2/ during the use of leave by all employees simultaneously; 3/ in case the employee, upon invitation of the employer, has not requested his leave by the end of the calendar year for which it is due.
V. Change of the place and the character of the work unilaterally by the employer
Under Art. 120 of the LC the employer may, in case of a production necessity or idle time, to assign to the employee, without his consent, to temporarily perform different work in the same, or in another enterprise, but in the same city or region, for a period of up to 45 calendar days in one calendar year, and in the event of idle time, as long as such idle time continues.
In this case the employer is entitled to redirect employees from departments, which are not operating to other departments or to engage them in performance of other types of work.
There are some conditions regarding the qualification and the health condition, which the employer has to observe. In general the employer is entitled to redirect the employees to other departments or to assign them other types of work respecting their qualification and health condition. However, in emergency situations the employer is entitled to change the place of work and the character of the work even regardless of the qualification of the employees, whereas the health condition of the employees has to be considered in all cases.
VI. Part-time work (shorter working hours, but not less than 4 working hours)
Under Art. 138a, Para 1 of the LC in case of reduction of the workload, the employer is entitled to introduce part-time work for a period of up to three months in a calendar year for the employees in the enterprise or in its unit.
Under the State of Emergency Act (§ 4, point 3 of the preliminary and supplementary provisions) the employer is entitled to introduce part-time work for the whole period of the State of Emergency or only for part of it. The new moment here is that no other grounds are necessary such as the reduction of the workload. No limitation of the duration up to 3 months in one calendar year is envisaged neither.
The duration of the working time cannot be less than half of the statutory established for the period of calculation of the working time.
In other words, if the parties to an employment relationship agreed working time 8 hours per day, then under the regime of part-time the employer is entitled to introduce working time for less working hours per day, but in any case not less than 4 hours.
The part-time working hours may be introduced for the whole enterprise or for a separate department or unit. Hence, the employer is not entitled to introduce part-time working hours for individual employees.
Furthermore, as per the Ordinance for the working time, rests and leaves the employer introduces part-time working hours by virtue of a written order and not less than 10 days prior to the date of the transition to the part-time working hours.
VII. Flexible working hours
Depending on the organization of the work, the employer is entitled to introduce working time in the form of flexible working hours.
In these cases the employer determines specific uninterrupted duration of the working time, during which the employees have to be at work. For example, the period of time from 11.00 h – 15.00 h. Outside the duration of the time for compulsory attendance at work the employees decide on their own when to commence working. However, in any case the uninterrupted rest between work days and weeks has to be observed.
In any case regardless of the exact commencement of the work the employees have to perform their duties for the duration of the whole statutory established working time, whereas they enjoy only the opportunity to decide on the commencement of the work.
VIII. Unpaid leave
Under Art. 160 of LC upon request of the employee, the employer may permit him an unpaid leave, regardless of the fact whether he has used his annual paid leave or not, and irrespective of his length of service.
In general, the unpaid leave up to 30 days in one calendar year is recognized as a statutory length of service, whereas the unpaid leave beyond that duration is recognized as such only if it is explicitly provided under the law or in an act of the Council of Ministers.
Based on the above rules the conclusion can be made that without the employee’s initiative and consent, the employer cannot make him use such leave unilaterally.
IX. Dismissals
In the present times of crisis the employers have also the options to terminate the employment contracts of part or all of their employees.
As per the present circumstances the most suitable grounds for such dismissals are the following: 1/ closing of the enterprise; 2/ closing part of the enterprise or staff reduction; 3/ reduction of the workload; 4/ seizing the work of the enterprise for more than 15 working days.
In any case, enlisted above, the employment contracts are terminated upon unilateral notice by the employer, the duration of which depends on the relevant employment contracts.
In the cases of closing part of the enterprise, staff reduction and reduction of the workload, if not all employees occupying one and the same job position are to be dismissed, the employer is obliged to perform preliminary selection procedure.
In case of dismissals in higher numbers the special rules for mass redundancy have to be applied as well.
X. Open-ended working hours
Under Art. 139a of the LC For some positions, due to the specific nature of the work, the employer may establish open ended working hours
The list of the job positions, for which open-ended working hours are established, shall be determined by an order of the employer. The employees on open-ended working hours shall, if necessary, perform their duties even after the expiry of the regular working hours. If this happens in working days this will not be considered as overtime work.
Again, in these cases as well, the uninterrupted rest between work days and weeks has to be observed.
The overtime on working days shall be compensated by an additional annual paid leave not less than 5 days, and work on holidays – by an increased remuneration for overtime work.
XI. Overtime work
Under Art. 143 of the LC work done upon the order of, or with the knowledge of and with no opposition by the employer or the respective superior, by an employee out of his agreed working hours shall be considered overtime work.
In general, the overtime work is allowed only in emergency cases, whereby unexpected and extraordinary circumstances emerge, which need the undertaking of urgent measures without any delay, such as disasters, accidents, etc.
However, overtime work is often performed even in many much more trivial circumstances.
Under Art. 146 of LC overtime work is allowed up to 150 hours within one calendar year for one employee.
Moreover, the overtime work cannot exceed 1/ 30 hours daily or 20 hours night work during one calendar month; 2/ 6 hours daily or 4 hours night work during one calendar week; 3/ 3 hours daily or 2 hours night work during two consecutive working days.
The overtime work is paid under higher rates, whereas some particularities are regulated depending on the fact whether the overtime work is performed on Saturdays and Sundays or on national holydays.
Under Art. 149 of LC the employer is obliged to register the performed overtime work in a special book.
XII. Rights and obligations of the employees
In the cases of idle time or for the time when the employer have seized the work of the enterprise due to the State of Emergency, i. e. the time, during which the employer is not in the position to provide any business tasks to the employees, as well as in the cases in which the employees are redirected to other departments or to perform other job duties, the employees are always entitled to their gross remunerations in full.
Furthermore, in the present unprecedented and extraordinary situation the employees working in all enterprises, which are not explicitly specified in the Order of the Health Minister are still obliged to continue the performance of their duties. In the same time the employees are entitled to require the introduction by the employer of special and strict rules for hygiene preservation and for preservation against viral infections. In return, the employees are obliged to observe strictly the introduced anti-epidemic measures.
The present article does not represent legal opinion or advice on specific case or situation.
The team of Ivanov and Yonkova Law Firm remains at disposal for provision of legal opinion and answers to any supplementary questions regarding the present or any other topic, you may have.
Author: Doychin Ivanov, attorney-at-law
Managing Partner of Ivanov and Yonkova Law Firm