Labor Law Consultation

16.08.2023

WHAT IS A "NEGOTIATED" LABOR REMUNERATION?

"Negotiated" labor remuneration is among the expressions often used in the law, for which no legal definition is given. An example of this is the text in the Labor Code in Bulgaria, according to which one of the main obligations of the employer in the employment relationship is to pay the worker or employee the negotiated remuneration for the work performed.

The same applies to the norm according to which for damage caused to the employer by negligence during or in connection with the performance of work duties, the worker or employee is liable in the amount of the damage, but not more than the negotiated monthly labor remuneration, etc. Examples in this guideline can also be found in other legal provisions.

What does the term "negotiated" labor remuneration actually mean under the law?

In order to clarify the meaning of the concept of "negotiated" labor remuneration, first of all we should keep in mind that the employment contract necessarily includes the basic and additional remunerations of a permanent nature, as well as the periodicity of their payment.

This means that the contract usually states the gross amount of remuneration.

It is also extremely important to explain the difference between "gross" and "net" remuneration, because it is not uncommon for workers to firstly not distinguish between the two concepts and secondly - to not pay attention when the concept is explicitly emphasized. This is also the reason why, when negotiating a remuneration upon starting work, many workers, after receiving the salary in their accounts, are surprised to find that the amount received is less than what they had originally agreed upon with their employers.

Let's recall that the "gross" labor remuneration is the sum of the basic salary and additional labor remunerations. It is also the basis for calculating benefits under the Labor Code. In the law, and very often and entirely colloquially, the concept of "net" labor remuneration is also used.

The "net" remuneration is obtained after making deductions from the labor remuneration as tax under the Personal Income Tax Act and insurance contributions at the expense of the insured person. In other words, a "net" labor remuneration refers to the so-called "net" amount to receive after all kinds of deductions of amounts.

The law also includes the concept of "guaranteed" remuneration. It is important to know that according to the law, in case of conscientious performance of the labor duties of the worker or employee, the payment of labor remuneration is guaranteed in the amount of 60 percent of his gross labor remuneration, but not less than the minimum wage for the country. The difference up to the full amount of the labor remuneration remains due and is payable additionally together with the statutory interest.

 

Reference:

Art. 66, para. 1, item 7, art. 128, item 2, art. 206, para. 1, Art. 245, Art. 247, para. 1 and Art. 250 of the Labor Code