Mass layoffs are a complex legal process that affects not only employers but also employees, trade unions, and state institutions. The procedure is strictly regulated by the Bulgarian Labour Code and the Employment Promotion Act, aiming to ensure fairness and legal compliance when terminating a large number of employees.
This article outlines what constitutes a mass layoff, the legal steps involved, and how a labor law attorney can protect the rights of both employers and workers.
1. What is a mass layoff?
1.1. Definition under the Labour Code
According to §1, item 9 of the Supplementary Provisions of the Labour Code, a mass layoff refers to the dismissal of a significant number of employees within a defined period, for reasons not related to the individual worker.
A mass layoff is deemed to exist when:
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At least 10 employees are dismissed in enterprises with 20 to 100 employees within a 30-day period;
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At least 10% of the staff is dismissed in enterprises with 100 to 300 employees within 30 days;
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At least 30 employees are dismissed in enterprises with more than 300 employees within 30 days.
1.2. Grounds for mass layoffs
An employer may proceed with a mass layoff based on the following grounds as per Article 328 of the Labour Code:
✅ Closure of the enterprise or part of it
✅ Staff reduction
✅ Decrease in workload
✅ Suspension of work for more than 15 business days
✅ Objective impossibility to perform the employment contract
✅ Changes in job requirements
⚠ Important: The employer cannot use unilateral termination without notice (Art. 330 LC) or mutual agreement (Art. 325 LC) as grounds for mass layoffs.
2. Mass Layoff Procedure
The procedure includes several critical steps that must be strictly followed to avoid sanctions.
2.1. Preparation
Check for trade unions and employee representatives
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If no unions are present, employee representatives must be elected.
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Check for a collective bargaining agreement that may include additional protections.
Determine affected employees
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The employer must define the exact number and positions to be terminated.
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Special care must be taken with employees under legal protection (e.g. pregnant women, mothers of children under 3, union leaders).
Schedule key dates
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Start date of the procedure
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Notification date to trade unions and the Labor Bureau (at least 30 days before termination)
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Date for issuing dismissal notices to affected employees
2.2. Notification and Consultations
Notifying trade unions and employee representatives (Art. 130a LC)
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Written notice must be submitted at least 45 days in advance
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The notice must include:
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Reasons for the layoffs
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Number of employees affected
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Criteria for selection
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Compensation and benefits offered
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Notification to the Labor Bureau must also be made within the legal deadlines.
2.3. Conducting Consultations
According to Article 130a(3) of the Labour Code, the employer is obliged to consult with trade union organizations or employee representatives before proceeding with the dismissals.
The goal of the consultations is to:
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Seek ways to avoid or reduce the scope of the planned dismissals;
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Explore options for mitigating the consequences through social measures such as retraining, job placement, or internal transfers.
⚠ Consultations must be meaningful and real. A lack of proper dialogue may lead to the invalidation of dismissals in court.
2.4. Notification to the Employment Agency
The employer is required to notify the Employment Agency in writing at least 30 days before the actual dismissals.
The notice must contain:
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Full identification of the enterprise;
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Number of employees and number of planned dismissals;
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Time frame for carrying out the layoffs;
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Results of consultations with employee representatives.
The Employment Agency may offer programs to support those affected.
2.5. Issuing the Dismissal Notices
After the 30-day period expires from the notification to the Employment Agency, the employer can officially issue the notices for termination to the affected employees.
Each termination must:
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Be issued individually and in writing;
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Contain a lawful ground for dismissal under Article 328 LC;
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Include reference to the completed consultation and notification procedures.
3. Special Protection for Certain Employees
Some categories of employees enjoy enhanced protection, and they cannot be dismissed without prior permission from the Labor Inspectorate:
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Pregnant women and mothers of children under age 3;
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Employees on maternity, parental, or sick leave;
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Elected trade union representatives;
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Employees on unpaid leave or leave for training.
⚠ The employer must submit a request to the Labour Inspectorate and receive a written approval before proceeding with the termination of any of these employees.
4. Role of a Labor Law Attorney
An experienced labor law attorney can provide legal assistance in:
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Planning and conducting mass layoffs in full compliance with the law;
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Representing the employer in consultations with trade unions and agencies;
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Drafting all necessary documentation;
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Defending employee rights in case of unlawful dismissal;
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Filing and handling complaints or court actions, if necessary.
At LegalFrame.bg, our team has extensive experience in both employer and employee representation during collective dismissal procedures.
5. Consequences of Violating the Procedure
Failure to comply with legal obligations can lead to:
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Administrative penalties for the employer (up to BGN 20,000 per violation);
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Claims for unlawful dismissal, with potential reinstatement of employees;
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Financial compensation for damages;
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Negative publicity and loss of trust.
Conclusion
Mass layoffs are a legally regulated process that requires careful planning, timely notifications, and good communication. Whether you are an employer preparing for downsizing or an employee facing dismissal, working with a qualified labor law attorney is critical to protecting your rights and ensuring compliance.
If you are facing a situation involving mass layoffs, contact Legal Frame – Law Firm in Sofia for professional legal support and guidance.
