10.06.2022
USE AND POSTPONING OF PAID ANNUAL LEAVE
Expert comment
Paid annual leave is permitted in writing by the employer or by a person appointed by him on the basis of a written request of the employee to the employer (Article 22, paragraph 2 of the Ordinance on working hours, breaks and leave - OWHBL).
The order of the employer should contain the grounds on which the leave is used (art. 155 or art. 156 LC), its duration, as well as the time of use. It is recommended that the fulfillment of the obligation be certified by placing on the order a text indicating the receipt/acquaintance with the order, date and signature of the employee.
With amendments to the Labor Code, in force since July 17, 2015, the obligation of the employer to approve a schedule for the use by employees of paid annual leave for the next calendar year by December 31 of the previous calendar year was abolished. The obligation of employees to use their paid annual leave in accordance with the schedule was also abolished.
Paid annual leave is allowed to the employee at once or in parts (Article 172 of the Labor Code).
According to Art. 173, para. 5 of the Labor Code, the employee shall use his paid annual leave until the end of the calendar year to which it refers.
The employer is obliged to allow the paid annual leave of the employee until the end of the respective calendar year, unless its use is postponed by the order of art. 176 LC. In this case, the employee is provided with the use of not less than half of the paid annual leave for the calendar year.
The Labor Code (Article 174) regulates the right of workers under the age of 18 and mothers with children under the age of 7 to take their summer leave and, at their request, at other times of the year, except in the cases under Art. 173, para. 4.
In order to create a guarantee that the employee will exercise his right to paid annual leave, in Art. 37a of the OWHBL is a regulated obligation for the employer, by virtue of which he is obliged at the beginning of each calendar year, but no later than January 31, to notify in writing each employee of the amount of paid annual leave, who is entitled to use during the calendar year, including deferred or unused from previous calendar years.
It is important to keep in mind that the deadline for fulfilling this obligation is fixed - from the beginning to the end of January. The notification should be documented.
Upon inspection by the control bodies for compliance with labor legislation, the employer must prove that he has complied with the deadline and has notified his employees in writing. No model of the notification has been established in the legislation. The employer may draw up the written document as an order, notification, memorandum or other type of written document addressed individually to each employee or with a document containing a list of employees and the annual leave due to them. Therefore, the employer has the right to decide for himself exactly what the notification should look like. It should be clear from the document that the information on paid annual leave has been brought to the attention of employees.
The notification should contain information on paid annual leave, which the employee is entitled to use, and it is not necessary to include leave, the right to use which has expired. However, it should contain information on older unused paid annual leave due for the years up to 1 January 2010, as this leave is not time-barred and can be used until the termination of employment.
According to Art. 43a of the OWHBL, the employers shall keep documentation for the paid annual leave of the employees, which shall contain information for use, interruption and postponement of the use, as well as for the paid remunerations under art. 177 of the Labor Code and for the compensations paid under Art. 224 LC.
Accumulated by the employee leave before January 1, 2010 - the so-called "old leave" has no statute of limitations.
With its Decision № 12 of 11.11.2010 the Constitutional Court of the Republic of Bulgaria declared the provisions of § 3f of the Transitional Provisions of the Labor Code and § 8a of the Transitional and Final Provisions of the Civil Servant Act unconstitutional, therefore the requirement of unused leave was dropped until 01.01.2010 to be used until the end of 2011.
These leave can be used until the termination of the employment relationship with the respective employer.
Where, for whatever reason, the employee has not used the leave due to him before 1 January 2010, the employer shall be obliged to pay him compensation for the termination of his employment.
When the paid annual leave or part of it is not used until the expiration of two years from the end of the year for which it is due, regardless of the reasons, the right to use it is extinguished by prescription (Art. 176a, para. 1 of LC).
With regard to the leaves after 01.01.2010 the provision of art. 176a of the LC. Following the change in the Labor Code in 2011, a two-year limitation period for the use of deferred paid annual leave was introduced. The limitation period is regulated in Art. 176a, para. 1 and para. 2 LC. When the paid annual leave is postponed under the conditions and by the order of art. 176, para. 1, the right of the employee to use it shall be extinguished by prescription after the expiration of two years from the end of the year in which the reason for its non-use has disappeared (during which the employee has returned to work).
Upon termination of employment, the right of the employee to compensation under Art. 224 of the Labor Code for the unused paid annual leave (including for the period up to 31.12.2009), the right to which has not expired.
With regard to limitation periods, it should be borne in mind that there is no explicit legal provision governing the order in which leave for previous years should be used. Given the provision of Art. 176a, para. 1 LC, the older leave should be used. The assessment of this is made by the employee.
The Labor Code provides for several hypotheses in which it is possible for an employer to place an employee on paid leave without his or her consent. In Art. 173, para. 4 LC and Art. 37b OWHBL regulates the cases in which the employer has the right to provide paid annual leave to the employee without his consent. These are the hypotheses in which:
The stay is a temporary suspension of the enterprise due to organizational, technical or economic reasons, regardless of their specific manifestation (accident, shortage of raw materials, etc.). It may affect both the entire activity of the enterprise and the activity of a separate unit or division. In order for the employer to grant paid leave to an employee under this hypothesis, the stay must last more than 5 working days.
It is important to note that the compulsory "holiday" use of paid annual leave (simultaneously by all employees) can be applied only if this possibility is enshrined in law or provided by the employer in the Rules of Procedure.
The employer follows with a special document: an order or a letter with an outgoing number to invite the employee to request to use his leave until the end of the calendar year for which it is due. The order or letter should be received from the employee, which is certified by a signature and date placed by the employee. In the document, the employer must give a specific period in which the employee can express his preference for the period in which he will use his paid annual leave. It should be clear from the content of the document that the employee is invited to use the paid annual leave due for him for the current year. If, after receiving the invitation and the expiration of the term given to him, the employee has not declared a period until the end of the year in which he will use the leave, the employer has the right to grant him paid annual leave.
The employer shall provide the use of the leave in writing and shall promptly notify the employee. According to the practice of the Labor Inspection Directorates, only in the absence of action by the employee (he has not used his paid annual leave until the end of the year for which it is due), at the beginning of the next calendar year the employer will be forced to paid annual leave to his employee by granting him the due but unused leave for the previous year.
If the use of the paid annual leave has been postponed by the order of art. 176, para. 1, item 2 of the Labor Code in conjunction with Art. 37d, para. 2 of the OWHBL at the written request of the employee with the consent of the employer, there would be no possibility for the employer to exercise its right to unilateral provision of the use according to art. 173, para. 4 LC, after the leave is postponed.
In Art. 37d, para. 2 OWHBL is a regulated obligation for the employer:
According to Art. 173a of the Labor Code, when due to a declared state of emergency or declared extraordinary epidemic situation by order of the employer or by order of a state body the work of the enterprise, part of the enterprise or individual employees is suspended, the employer has the right to grant paid annual leave or the employee and without his consent, including an employee who has not acquired the required by law the minimum length of service - currently 4 months. The time during which leave is used is recognized as length of service.
In the provision of art. 173a, para. 1 of the Labor Code does not limit the amount of leave that the employer may provide to the employee without his consent. A necessary precondition for the application of this procedure for granting leave is the existence of an order of an employer or a state body under Art. 120c, para. 1 and 2 of the Labor Code for termination of work in case of declared state of emergency or emergency epidemic situation.
The provision of Art. 173a, para. 2 of the Labor Code stipulates the obligation of the employer to allow the use of paid annual leave or unpaid leave in case of a state of emergency or in cases of declared epidemic emergency at the request of a certain category of workers in a more vulnerable position, namely:
The assessment of the type of leave - paid annual leave or unpaid leave, belongs to the employee. Paid annual leave includes both paid annual leave for the current calendar year and leave for previous calendar years that has not expired. Unlike the general procedure for using unpaid leave, in the hypothesis of Art. 173a, para. 2, the employer shall not have the right to refuse the unpaid leave of its employee, falling into the listed category of persons.
By the order of art. 175, para. 1 of the Labor Code, when during the use of the paid annual leave the employee is allowed another type of paid or unpaid leave, the use of the paid annual leave is terminated at his request and the rest is used additionally by agreement between him and the employer.
It is important to know that the law also provides for the possibility of the employee's leave to be interrupted by mutual consent of the parties, expressed in writing.
The use of the paid annual leave may be postponed for the next calendar year either by the employer or by the employee, when the requirements provided for in Art. 176 LC.
Postponement of the use of paid annual leave by the employer
According to Art. 176, para. 1, item 1 of the Labor Code, the use of the paid annual leave may be postponed for the next calendar year by the employer due to important production reasons under the condition of Art. 173, para. 5, sentence three of the LC.
For the employer there is a certain limitation in the possibility to postpone the paid annual leave for the next year. The restriction is in the provision of art. 173, para. 5 of the Labor Code, which obliges him to enable the employee to use not less than half of the paid annual leave for the calendar year. Therefore, in this case, the employer has the right to postpone the use of not more than half of the paid annual leave for the following calendar year, without the need for the consent of the employee.
It is important to pay attention to the fact that the provision of the law regulates "half of the due leave", which means that the employer will be able to postpone not only 10 working days, but half of the paid annual leave for the calendar year - for example in cases where the employee uses extended paid annual leave, or if, for example, the parties have agreed in their employment contract the amount of paid annual leave of 24 instead of 20 days, then the employer would have the right to postpone 12 of them under Art. 176, para. 1, item 1 LC.
The employer may postpone the use of the paid annual leave of an individual employee, as well as of the employees of the respective organizational (structural) unit (Art. 37d, para. 1 OWHBL).
The employer postpones the use of the leave in writing and promptly notifies the employee (Art. 37d, para 2 OWHBL).
Postponement of the use of paid annual leave by the employee
According to Art. 176, para. 1, item 2 of the Labor Code, the use of the paid annual leave may be postponed for the next calendar year by the employee - when he uses another type of leave or at his request with the consent of the employer.
The employee must submit a written request to the employer to postpone the use of paid annual leave for the next calendar year, except when the employee uses other types of statutory leave (e.g. leave for temporary incapacity for work, pregnancy, childbirth, adoption, parenting of a small child, etc.).
When using another type of statutory leave, a written request is not required, as the postponement is by law. The reason in this case for the postponement of the paid annual leave is the use of another type of leave, as the law does not determine its minimum amount. The postponement of all or part of the amount of paid annual leave in this case is necessary because the use of other statutory leave has led to the inability to use paid annual leave.
It is important to know that the Labor Code does not provide for a legal limit on the maximum amount of deferred leave, i.e. all or part of the paid annual leave may be postponed.
It should be borne in mind that both the LC and the NRVPO do not explicitly specify a deadline for submitting a written request for deferment of use. Since in Art. 173, para. 5, assoc. 1 of the Labor Code stipulates that the employee uses his paid annual leave until the end of the calendar year to which it relates, it could be concluded that the written request can be submitted no later than the end of the calendar year.
When the use of the leave is postponed by the employer due to important production reasons and when at the request of the employee the use of the paid annual leave is postponed with the consent of the employer by the order of art. 176, para. 1, item 2 of the Labor Code, the employer postpones the use of the leave in writing and promptly notifies the employee (Art. 37d, para 2 OWHBL). It would be most correct to fulfill the obligation to certify by placing on the order a text indicating the receipt/acquaintance with the order, date and signature of the employee, but any other written document would be admissible.
According to Art. 176, para. 2 of the Labor Code, when the leave is postponed or not used until the end of the calendar year to which it refers, the employer is obliged to ensure its use in the next calendar year, but not later than 6 months from the end of the calendar year, for which it is due.
In fact, Art. 176, para. 2 of the Labor Code regulates two possibilities: "the leave should be postponed for the next calendar year" or "the leave should not be used until the end of the calendar year to which it refers".
The difference between the two hypotheses is that in the first case there is an agreement between the employee and the employer, expressed in writing, to defer the full or part of the paid annual leave for the year, while in the second case - the employee) has not requested and the employer has not postponed part of the paid annual leave and at the same time the employee has not used the paid annual leave until the end of the calendar year to which it refers.
However, if the employer does not allow the use of the leave by the end of the 6th month of the following calendar year, the employee has the right to determine the time of its use by notifying the employer in writing at least 14 days in advance. According to Art. 37e OWHBL in this case the employee has the right to determine the time for using the paid annual leave until the expiration of the limitation period under Art. 176a, para. 1 LC. After the expiration of the limitation period, the right to use the paid annual leave shall be extinguished by prescription. The right to payment of the expired leave upon termination of the employment contract is also extinguished.
It is important to know that the employee can in this order be forced to use only his paid annual leave from previous years, but not the one due to him for the current year.
When the use of the paid annual leave is postponed under the conditions and by the order of art. 176, para. 1 of the Labor Code, the right of the employee to use it shall be extinguished by prescription after the expiration of two years from the end of the year in which the reason for its non-use has disappeared (Art. 176a, para 2 of the Labor Code).
