Severance pay in Bulgaria: what the Labour Code says
Short answer: in the articles of the Bulgarian Labour Code (Кодекс на труда, КТ) that I opened, I did not find a general severance that pays a set amount per year worked, as in Turkey. Instead, an employee is entitled to compensation from the employer in specific cases: closure or downsizing, termination due to illness, retirement, and failure to observe the notice period.
Working life · Last reviewed: 2026-10-08
This is not legal or financial advice
What was checked
The information below rests on three articles I opened and read in the current Labour Code text on lex.bg on 8 October 2026: Art. 220 (breach of the notice period), Art. 222 (the compensation cases) and Art. 224 (unused annual leave). The Code may contain other articles; do not treat what I read as complete for your own situation.
Art. 222: three compensation cases
| Case | Compensation |
|---|---|
| Closure of the enterprise or a part of it, staff reduction, reduced volume of work, stoppage of more than 15 working days, refusal to follow a relocated enterprise, or the post being vacated for an unlawfully dismissed former holder | Gross pay for the time out of work, up to 1 month; a Council of Ministers act, a collective agreement or the contract may provide for longer; if a lower-paid job is taken in that period, the difference is paid (Art. 222(1)) |
| Termination because of illness | Gross pay for 2 months, provided at least 5 years of service and no such compensation in the last 5 years (Art. 222(2)) |
| After the right to a pension for insurance record and age is acquired, whatever the ground of termination | Gross pay for 2 months; 6 months if 10 years were served with the same employer or group of companies within the last 20 years; payable only once (Art. 222(3)) |
The article also applies the retirement compensation to an employee who meets the conditions for a reduced pension (Social Insurance Code Art. 68a) (Art. 222(4)). The 10-year condition in the retirement case is the only seniority-linked step in the text I read.
Notice period and annual leave
- A party entitled to end the contract with notice may end it before the notice expires, in which case it owes the other party compensation equal to gross pay for the unobserved notice period (Art. 220(1)); the notified party may do the same and owes the same compensation (Art. 220(2)).
- On termination, an employee has the right to cash compensation for unused paid annual leave, calculated under Art. 177 as of the termination date (Art. 224(1)-(2)).
This page is not legal advice
Frequently asked questions
Do I automatically get severance pay when dismissed in Bulgaria?
In the Labour Code articles I read there is no general years-of-service payment on every dismissal. Compensation arises in specific cases: employer-side reasons such as downsizing (up to 1 month), illness (2 months) and retirement (2 or 6 months).
How many salaries is the retirement compensation?
Under Art. 222(3), 2 months of gross pay, or 6 months if 10 years were served with the same employer or group in the last 20 years. It is paid only once.
Is unused annual leave paid out?
Yes. Under Art. 224, cash compensation is due for unused paid annual leave when the employment contract ends.
Sources
The information on this page is based on the official sources listed below. Legislation changes — open the links and verify the current position.
- Кодекс на труда (КТ) — чл. 220, чл. 222, чл. 224 (lex.bg) — https://lex.bg/laws/ldoc/1594373121 · 2026-10-08
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