Teodor Detchev

Evolution of the model of industrial relations in

Bulgaria 1989 – 2002
The models of industrial relations on which this survey is grounded
There are different classifications of the models of industrial relations established in
different countries in which different criteria are used. Each of them bears conven-
tionality to some extent. For the needs of this survey, we use the classification pro-
posed in [1]. Three models are delimited by it – a traditional, a neo-conservative and
a neo-liberal one – depending on who are the main actors and what are the rules and
procedures of establishing industrial relations in a particular country.

Traditional model of industrial relations

In accordance with [1], organisations of workers and employees on the one side, and
organisations of employers on the other, predominate in traditional industrial rela-
tions. The relations between them exist mainly at the sectoral or regional level, as
well as in enterprises. At a certain degree of association, they can also be realised at
the national level. In the traditional model, government authorities respect the auton-
omy of the actors in industrial relations and encourage regular bipartite interaction be-
tween the employers’ organisations and those of workers and employees. This
happens mainly by the establishment and development of legislative standards and
sub-normative regulations, and also by court and arbitration judgements. As a rule,
the direct interference of the state in the relationships between employers’ and em-
ployees’ organisations is avoided. The state, on behalf of the government, acts an im-
portant role in the creation and normal working of the institutions of conciliation, as
well as of that of labour arbitration.

Neo-corporative model of industrial relations

In the case of the neo-corporative model, it is the organisations of workers and em-
ployees and the state, the government in particular, which are the main actors in in-
dustrial relations. Their interaction is concentrated predominantly at the national level
but it is also developed at the sectoral and the regional levels. The role of employers’
associations here is certainly more slight, while the government is a direct participant
in the negotiations.

Neo-liberal model of industrial relations

In the case of the neo-liberal model, the government and the employers’ associations
are the main characters. In this case, the national level is also the fundamental one,
while relations are also developed at the sectoral and the regional levels. In the case of
the neo-liberal model, an under-appreciation of the organisations of workers and em-
ployees can be observed and is expressed by them being pushed out of discussions
over problems connected with the elaboration and realisation of economic and social

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 Teodor Detchev

policy. In fact, opportunities for trade unions to influence the making of decisions
concerning their members are restricted.

Establishment of the neo-corporative model of industrial relations in

Bulgaria, 1989–1994
It could be said that, in Bulgaria between 1989 and 1994, and even as far as the
present day in this country, a neo-corporative model of industrial relations has been
established. Associations of workers and employees (trade unions) on the one hand
and the state (represented by the Government) on the other are the leading actors in
industrial relations. That a transition from a centralised, planned economy of approxi-
mately 100% state-owned property to a mixed social market economy (at least, this is
what is stated in the Constitution of the country) is being carried out reflects, in an in-
disputable way, the development of industrial relations in Bulgaria as well as, respec-
tively, tripartite collaboration and the body of its realisation at the national level –
currently, the National Council for Tripartite Collaboration (NCTC).

Disproportionality in the development of trade unions and employers’ associations:

the initial weakness of employers
An absolute disproportionality in the development of trade union and employer struc-
tures is the most important aspect originating from the totalitarian heritage.
On the one hand, between 1944 and 1989 trade unions were transformed into be-
ing a part of the state (they were the ‘transmission belt of the Party’) and, thus, they
were delegated with definite functions which, in a democratic society, would have
been governmental ones (for example, labour safety or, in contemporary terms,
‘health and safety at work’). Consequently, they had not only their own apparatus at
their disposal but also their own (furthermore, very well-grounded) nomenclature.
On the other hand, there were no employers’ associations. During the totalitarian
period, the Bulgarian Chamber of Commerce and Industry (BCCI) was the only or-
ganisation in which industrial managerial cadres (who cannot be categorised precisely
as employers) have been able to participate. In 1980, the Bulgarian Industrial Associ-
ation (BIA) split away from it.
During the period of totalitarianism (since 1967), the BCCI has, formally of
course, represented employers in Bulgarian delegations to international labour confer-
ences. Membership of it is mandatory and, according to some authors:

During this period, it could be considered as a sub-division of the Ministry of Commerce. [2]

Formal employer participation in the first steps of tripartism

In 1989, neither BCCI nor the BIA participated in the wakening of tripartite collabo-
ration. BCCI explained its passivity as:

A protest against the manipulations of the government. [2] [3]

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 Evolution of the model of industrial relations in Bulgaria 1989 – 2002

To be objective, neither the BCCI nor the BIA fulfilled the requirements and the
ideas of employers’ associations which were able to participate in tripartite collabora-
tion. When, on February 28 1990, negotiations began between the Confederation of
Independent Trade Unions in Bulgaria – CITUB (created as a result of the rapid re-
form process of the Bulgarian trade unions which had existed during totalitarianism),
and Andrei Loukanov’s government on the conclusion of a ‘General Agreement’, the
sharp necessity arose for an employers’ association in order that this might be trans-
formed from ‘a bipartite social contract’ into a tripartite one.
As a result of the impossibility that BCCI could be deployed in this way, the
newly-established National Council of Industrial Managers in Bulgaria (NCIMB) was
called upon to help. Authors close to the Confederation of Independent Trade Unions
in Bulgaria state clearly that the NCIMB:

Has been established with the support of the trade unions in order that a tripartite structure at the
national level could be constructed. [3]

The assessment is also made that:

This is, to a large extent, a formal association of the directors of state-owned enterprises who are
not endowed with either economic or administrative power, or with motivation and responsibility,
to act as competent employers, i.e. to negotiate with trade unions and the government, standing
up for the interests of enterprises. [3]

It is not by chance that the Confederation of Labour ‘Podkrepa’ did not miss the
opportunity to attack the General Agreement, rejecting its tripartite character by stat-
ing that the NCIMB:

Does not represent managers who are independent of the state. [4]

Up to now, some leaders of the Confederation of Labour ‘Podkrepa’, for example

its Vice-President Dimitar Manolov, have refuted in front of the most influential in-
ternational forums that the General Agreement has a tripartite character, commenting
that the chronology of tripartism in Bulgaria stems directly from 1993.
The indisputable weakness of employers’ associations was acknowledged by the
associations themselves on many occasions during the 1989-1994 period. In its posi-
tion opposing the ‘Agreement on the further conduct of industrial reform and keeping
the social peace’ (signed on June 13 1991), the Bulgarian Industrial Association de-
clared that:

At this stage of the economic and social development of society, the role of the employer is sub-
stantially deformed in a tripartite system. [5]

Looking for adequate social partners amongst the employers’ associations

It occurs that it is difficult even to point out employers’ associations which are repre-
sentative. After the NCIMB disappeared from the scene, at the time of Philip Dimitrov’s
cabinet, different employers’ associations, or configurations of such organisations,

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 Teodor Detchev

aspired towards being representative. The lack of a legally-established criteria of repre-

sentivity helps, to a great extent, the overall level of confusion over this problem.
For example, on May 20 1992, the Civic Union for Private Economic Enterprise
(CUPEE), the BIA, the Association of Free Entrepreneurs and the Movement for the
Economic Revival of Bulgaria opposed, together with the trade unions, the social and
economic policy of the government in a general declaration. Particularly on the part of
the employers, this move was also aimed at gaining the benevolent influence of CITUB
and CL ‘Podkrepa’ within the tripartite association. Despite this, the situation turned out
to be a little different. On May 29 1992, the social partners and Vice-Premier Nikolai
Vassilev announced that CUPEE, the BIA, the Bulgarian Union of Private Entrepre-
neurs ‘Vazrajdane’ and the Association of Free Entrepreneurs ‘Alternative – 2000’
would participate in the newly-established National Council of Social Partnership.
After the legislative arrangement of tripartite collaboration at the beginning of
Lyuben Berov’s cabinet government, in January 1993, the BIA, BCCI, CUPEE and
BUPE ‘Vazrajdane’ were approved as nationally-representative employers’ associa-
tions (NB the Civic Union for Private Economic Enterprise – CUPEE is also men-
tioned in [8, p. 71] as the Union of Private Economic Enterprise). This situation is the
same today.
During conversations with Ian Grant (in connection with a project for the support
of social dialogue under the EU PHARE programme), conducted on July 8 1993, the
leaders of the social organisations fully accepted the assessment of the weakness of
their organisational structures. This became the occasion of establishing special funds
for them – to the tune of ECU 450 000 [6].
Employers began to play a more important role in tripartite collaboration (mainly
via the participation of the BIA and, to some extent, BCCI) only at the time of Ivan
Kostov’s cabinet, i.e. during the 1997–2001 period.

From ‘quasi-tripartism’ to a neo-corporative model of industrial relations in Bulgaria

This review of the development of employers’ associations and their participation in
tripartite collaboration, including the authorities for its realisation at the national
level, shows clearly that, during these years, the fundamental axis along which the de-
bates were held within these authorities has been government-trade unions, with the
employers’ role being of more secondary importance. No doubt the position of CL
‘Podkrepa’, that the General Agreement of 1990 ‘is not of a tripartite character,’ and
‘it is not the beginning of tripartite collaboration,’ is, to a great extent, an exaggerated
one. But it cannot be rejected that tripartite collaboration in Bulgaria has gone though
a unique quasi-tripartism or ‘two-and-a-half-partism’, in which the weak link has
been the employers’ associations [7]. This is a logical consequence also of the totali-
tarian heritage. For this reason, it can be stated quite firmly that, in the 1989-1994 pe-
riod, a neo-corporative model of industrial relations was gradually established in
Bulgaria. The trade unions and, of course, the government predominate in the Na-
tional Council of Tripartite Collaboration (NCTC). Depending on the situation, the
employers’ organisations stand either by the government or the trade unions but, in
addition, they are acutely lacking in both an expert and an administrative capacity.

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 Evolution of the model of industrial relations in Bulgaria 1989 – 2002

Moving further forward, after 1994, we can see that, nowadays, the importance of
CUPEE and, in particular, of BUPE ‘Vazrajdane’ in tripartite collaboration is sur-
passed by their participation (against remuneration) in particular tripartite managerial
bodies, predominantly the National Social Insurance Institute and the National Em-
ployment Service.

Reciprocity between government strength and the model of industrial

relations during the period of transition
The problem of the correlation between ‘the strength’ of a Government and the develop-
ment of social dialogue and tripartite collaboration is of great interest. (A criterion of
‘the strength’ of a Government can be the extent to which it enjoys sufficient parliamen-
tary support, i.e. whether it is a one-party government or one based on coalition).
It is no secret that, during the government of Jan Videnov, many trade union
members and authors connected with the labour movement shared the concept that,
the more imaginary the parliamentary support of a Government, the more construc-
tive its behaviour within a social dialogue framework, i.e. tripartite collaboration. [3]

The cabinets of Dimitar Popov and Lyuben Berov

The cabinet of Dimitar Popov is highlighted as a typical coalition Government in
which tripartite collaboration was attached major importance. Actually, during
Popov’s cabinet, the decisions of the National Tripartite Commission of Interest Co-
ordination – NTCCI (re-named towards the end of the mandate of the Government as
the Permanent Tripartite Commission of Interest Co-ordination – PTCCI) attained ex-
clusive importance, as they:

Are to be immediately executed by all the ministries, institutions and territorial governmental
bodies, (quoted after [2], p. 93 and [7], p. 15)

In addition, the tripartite commission was referred to as the second centre of

power.
The government of Prof. Lyuben Berov is also used as a standard example – during
its time, the legislative arrangements for tripartite collaboration were fulfilled. Actually,
in Parliament the Berov Government relied on the so-called ‘dynamic majority’ (a jour-
nalistic expression which should be understood as the support of the parliamentary
group of the Movement of Rights and Freedoms; the major part of the parliamentary
group of the Bulgarian Socialist Party and its allies; some deputies of the parliamentary
group of the Union of Democratic Forces – mainly the deputies of the Alternative
Social-Liberal Party; the circle around the former Vice-President and ex-Minister of
Defence, Dimiter Loudjev, initially known as the New Policy Centre; and the deputies
Ivan Poushkarov, Svilyana Zaharieva and Petko Ginev – initially members of the Social
Democratic Party under the chair of Ivan Kourtev, and who later established themselves
as the ‘Congregation of Democracy’ under the chair of Ivan Anev).
The Berov Government was a hostage of an intricate complex of intertwining in-
terests but it really tried to guarantee the support of the social partners by delivering

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 Teodor Detchev

definite concessions in their favour. However, drawing parallels between the govern-
ments of Dimitar Popov and Lyuben Berov, we cannot fail to consider that giving a
decisive stimulus to the legal arrangements of tripartite collaboration, Lyuben
Berov’s Government used almost effortlessly the concept on the regulation of tripar-
tite collaboration developed during the Popov Government.

Philip Dimitrov’s Government and his time-expired experiment on transforming the

neo-corporative model of industrial relations into a traditional one
Philip Dimitrov’s Government (the one-party government of the Union of Demo-
cratic Forces, relying in Parliament on its parliamentary group and on the parliamen-
tary group of the Movement for Rights and Freedoms) is regarded as a typical
example of a one-party government. During its time, a crisis of tripartite collaboration
occurred because of the wish of the cabinet to limit its framework and to decrease the
burden of the social partners – mainly, of the trade unions. Actually, Philip Dimi-
trov’s government tried to make two once-for-all changes in industrial relations.
On the one hand, it tried to transform the model of industrial relations in the con-
text of the traditional model described above. This turned out to be groundless at the
moment when the state was the owner of the majority of enterprises all over the coun-
try and when managerial employees were very far from the position and mentality of
real employers. The attempt the state to alienate from social collaboration and to leave
it mainly in the hands of the rest of the social partners, has been reasonably taken by
the trade unions as an escape of responsibility at the eve of very difficult political and
structural reforms.
On the other hand, Philip Dimitrov’s Government had tried, through making alter-
ations in the Labour Code, to initiate in enterprises the institution of works councils,
and it also took up the issue of the conclusion of employment contracts. The latter was
a quite untimely initiative and was considered by the trade unions as no more than an
attempt at their exclusion from social partnership. At that time, in fact, there were no
foreign investments in Bulgaria; and neither had the large trans-national companies
entered the country. If, nowadays, the trade unions (and, especially, the CITUB) re-
port at a much higher degree the benefits of participating in works councils, then,
back in 1992, regarding the conclusion of collective employment contracts at the level
of incorporation in trans-national companies, this was for them quite simply a viola-
tion of their interests. The result was the strong opposition to the Government of hith-
erto irreconcilable opponents – CITUB and CL ‘Podkrepa’.
The confrontation between Philip Dimitrov’s Government and CL ‘Podkrepa’ is
one of the main reasons behind the emergence from it of two new trade union centres
– the National Trade Union (NTU) and the Association of Democratic Syndicates
(ADS). CL ‘Podkrepa’ has been successful in reaching a definite degree of agreement
and unity of action with its initially resolute opponent – CITUB – but its relations
with NTU and ADS thus far remain antagonistic and characterised by deep hostility.
It is a particular paradox that Lyuben Berov’s Government stepped up the changes
in the Labour Code which had been prepared during the Government of Philip Dim-
itrov. To some extent, the comparatively smooth procedure of tripartite collaboration

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 Evolution of the model of industrial relations in Bulgaria 1989 – 2002

during the first year of the coalition Government of Lyuben Berov can be attributed to
the social partners having managed to ‘spend’ a large amount of pent-up negative
energy during the time in power of the one-party Government of Philip Dimitrov.

Jan Videnov’s Government and the attempts at erasing the trade union parameter
of tripartite collaboration
The activities of Jan Videnov’s Government (which was a pseudo-coalition, dominated
by the Bulgarian Socialist Party and relying on an absolute majority in Parliament) are
also pointed to as constituting a further downwards trend in the development of tripar-
tite collaboration while, furthermore, such trends were exacerbated by the trade unions
themselves. [8] Videnov’s cabinet did not make any alterations in the regulation of tri-
partite collaboration, but the socialist Government did try to subvert the National Coun-
cil of Tripartite Collaboration (BCTC) by allowing membership of it to a new trade
union creation – the Community of Free Trade Union Organisations in Bulgaria
(CFTUOB). This was the cause of the initial incitement of confrontation, thereafter es-
calated step-by-step and fed by the different activities of the Government until the
events of January 1997 were reached, during which period the Bulgarian Socialist Party
was forced to transfer power to a Cabinet led by Stefan Sofianski.
Like the Government of Philip Dimitrov, the Government of Jan Videnov tried to
control how trade unions would react in a situation in which the level of the state rep-
resentative, who presided over the national body of tripartite collaboration, had de-
creased. Both Governments tried at the beginning to change the vice-president and to
preside over the national body of tripartite collaboration with a Government Minister.
In both cases, this provoked an immediate reaction by the trade unions and, after
some disputes and much wasted energy, the previous condition was re-attained.

A deterministic correlation between the strength of the Government and

the model of industrial relations does not exist
The axiom “coalition Government–successful tripartite collaboration; one-party
Government–crisis in tripartite collaboration” is simplistic and determinable only on
a superficial basis. A more detailed analysis of the facts shows that things are not so
deterministic.
The examples of the governments of Dimitar Popov and Lyuben Berov are per-
haps not well sustained. In the first place, during Dimitar Popov’s Government and, to
an even greater degree, during Lyuben Berov’s Government, it has been noted that, at
the first symptoms of the cabinet quivering, cataclysms took place in the functions of
tripartite collaboration at the national level. In the case of the cabinet of Lyuben
Berov – cited as an example of a successful tripartite collaboration cabinet – after a
course of conflicts within it, the NCTC ceased its operations on April 26 1994. This
state of affairs continued up to November 11 1994, when Reneta Injova’s cabinet
d’office (and, to be more precise, vice-premier Nikola Vassilev) restored tripartite col-
laboration.
Tripartite collaboration during the ‘strong’ cabinet of Ivan Kostov, on the other
hand, depicts a triumph of the neo-corporatist model.

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 Teodor Detchev

At the same time, Ivan Kostov’s Government, which relied on an absolute parlia-
mentary majority (not only among the representatives elected on the list of the Allied
Democratic Forces – ADF, but also in the parliamentary group of the Union of the
Democratic Forces, which was the backbone of the ADF), does not register in the
scheme described above. During Kostov’s cabinet, by mutual concessions between
the social partners, tripartite partnership worked rather successfully. On October 2
1997, the Government, CITUB, CL ‘Podkrepa’ and BIA signed a Charter for social
collaboration and a Memorandum of priority activities. During the next few years, the
Memorandum was updated several times. Even when CL ‘Podkrepa’ withdrew its
signature from the Charter (on grounds which were perhaps rather conjectural), it did
not leave the NCTC or any other body realising tripartite collaboration. During Ivan
Kostov’s cabinet (in which, it is rather important to note, that Ivan Neikov – the long-
time Deputy Chair of the largest trade union confederation, the CITUB – was the
Minister of Labour and Social Policy), tripartite collaboration clearly even reached an
optimal level – the NCTC was less burdened but, on the other hand, the intense partic-
ipation of the social partners at all levels in working groups aiming to realise solutions
should be noted.
During Ivan Kostov’s cabinet, an overhaul of legislation in the spheres of health
and safety at work and in social insurance was accomplished, while important
changes in the Labour Code were also made and the Act on the Economic and Social
Council passed. Considering that all this was done in close collaboration with the so-
cial partners, and with the very important participation of the trade unions, it could be
said that, during this period, we witnessed a triumph of the neo-corporative model of
industrial relations in Bulgaria.
In this sense, the thesis that ‘strong’ governments always aim to restrict, or simply
to neglect, tripartite collaboration is not always valid and it should certainly be con-
sidered in the context of the historical situation. Above all, we are unable to agree
with Lajos Héthy that the successful action of tripartite collaboration in “countries in
transition” depends to an enormous degree on the philosophy, i.e. the readiness, of the
relevant governments to partner in it. [9] All over central and eastern Europe, there
are many examples of governments which do not mind sharing the responsibility of
conducting unpopular reforms connected with the economy and the reconstruction of
the labour market together with their social partners and, in particular, with the trade
unions. But neither is the opposite an exception; typical examples here are the Go-
vernments of Vaclav Klaus in the Czech Republic [10] [11] and that of Victor Orban
in Hungary. [9]

The strategy of the social partners in Bulgaria regarding the development

of industrial relations
Considering the neo-corporative model of industrial relations which has characterised
Bulgaria and the co-relationship between the ‘strength’ of the Government and the
course of social dialogue – predominantly at the national level (i.e. in the National
Commission for the Co-ordination of Interests – NCCI; the National Tripartite Com-
mission for the Co-ordination of Interests – NTCCI; the Permanent Tripartite Com-

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 Evolution of the model of industrial relations in Bulgaria 1989 – 2002

mission for the Co-ordination of Interests – PTCCI; the National Council for Social
Partnership – NCSP; and the National Council for Tripartite Collaboration – NCTC),
the conclusion could surely be drawn that trade unions will defend the retention of the
status quo by all means available. Even right after November 10 1989, the trade union
elite in the Bulgarian trade union movement had a far clearer vision of its future role
than, say, the elite of the Bulgarian Communist Party in power. The reformist CITUB
(the successor of the former Bulgarian trade union movement) found its place in the
democratic process in a clever way. CL ‘Podkrepa’ also appreciated very quickly the
forward prospects of being a national representative trade union formation and gave
up the rather attractive position of being a founder-member of the Union of Demo-
cratic Forces just when the latter came to power.

The struggle between the trade union confederations for national representivity
CITUB and CL ‘Podkrepa’ eagerly defend the basis of the neo-corporative model, as
well as their roles as main participants and actors. They reject the opportunity for an-
other nationally-representative trade union to appear and, in the vocabulary of the
leaders of CL ‘Podkrepa’, terms such as ‘authentic trade unions’ (no doubt these are
CITUB and CL ‘Podkrepa’) and ‘syndicalists’ (other registered trade union organisa-
tions) do crop up.
During Dimitar Popov’s Government, CITUB and CL ‘Podkrepa’ successfully re-
jected the pretensions of the People’s Trade Union ‘Edinstvo’ (later renamed the In-
dependent Trade Union ‘Edinstvo’) towards participation in the NTCCI/PTCCI. In all
justice, it ought to be acknowledged that a large number of self-employed and unem-
ployed people are listed as members of ‘Edinstvo’. The notion of a trade union of the
unemployed (having several tens of thousands of members) and of a trade union for
members of producers’ co-operatives (having several hundred thousands of members)
provokes justified hesitations as to what extent ‘Edinstvo’ is a trade union organisa-
tion at all.
During Lyuben Berov’s Government, CITUB and CL ‘Podkrepa’ also repelled
the pretensions of the Community of Free Trade Union Organisations in Bulgaria
(CFTUOB) towards participation in the NCTC. Their reasons are connected with the
disputed evidence of the national representivity of the CFTUOB. It should not be for-
gotten that, at that time, the procedure of proving that the criteria for national repre-
sentivity had been fulfilled was rather conditional. Proof is grounded on documents,
presented by the social partners themselves, which are not certified by anyone. Con-
trol is executed, in fact, by the General Labour Inspectorate but a complete, meticu-
lous check is not possible at all.
However, Jan Videnov’s Government managed to ‘introduce’ the CFTUOB to the
NCTC, in spite of the protests of CITUB and CL ‘Podkrepa’, in the attempt to ‘wash
away’ the trade union component in tripartite partnership. This is one of the numerous
grounds why CITUB and CL ‘Podkrepa’ participated with particular eagerness in the
‘little revolution’ during January-February 1997 which led to the falling from power
of the ‘Democratic Left’ coalition, dominated as it was by the Bulgarian Socialist
Party (BSP). At the last meeting of Jan Videnov’s cabinet (at that time, the cabinet

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 Teodor Detchev

had been resigned for almost two months), it took its revenge of CITUB and CL ‘Pod-
krepa’ by accepting the National Trade Union (NTU), the General Centre of Branch
Trade Unions in Bulgaria (GCBTB) and the Independent Trade Union ‘Edinstvo’ as
nationally representative. It must be emphasised that NTU is a trade union centre, de-
spite being at that time in an exclusively close relationship with the Union of Demo-
cratic Forces. (‘Edinstvo’ has for a long time been close to the BSP, while the
GCBTB is a split from CFTUOB). Evidently, the hostility of the resignation cabinet
to both the two general trade union confederations was so significant that it passed as
a nationally representative organisation one that has been amongst the most hostile to
BSP trade union structures, in order only to hurt them.
The cabinet d’office of Stefan Sofianski recognised as nationally representative the
Association of Democratic Syndicates (ADS) and so the trade unions in the NCTC
amounted to seven. Both ‘authentic’ trade unions answered the hit immediately – in
countersigning the Charter for social collaboration and the Memorandum of priority
activities, they gained the consent of Ivan Kostov’s Government to a unique ‘trade
union count’ to be undertaken in order to determine the presence of representivity crite-
ria concerning the trade union formations. The procedure began at the end of 1998 and,
by 1999, the nationally representative trade unions numbered again only two.

CITUB and CL ‘Podkrepa’ – strongholds of the neo-corporative model of industrial

relations
From everything written thus far, it is evident that CITUB and CL ‘Podkrepa’ are
ready to oppose all who try to deflect the model of industrial relations into a more
neo-liberal or, even, traditional course. Accepting this axiom, we can explain the un-
expected attack of CL ‘Podkrepa’ against Philip Dimitrov’s Government in 1992 – at
a moment when it had been granted with exclusive privileges. Its officials literally
lorded the Ministry of Industry (of which Ivan Poushkarov was the Minister), while
the property of the general competitor – CITUB – was confiscated by law. Excluding
conspiracy theories of overthrowing the cabinet of Philip Dimitrov, which are not a
subject of the present survey, the only explanation remaining is that CL ‘Podkrepa’
preferred to start a war against the Government in the name of the defence of the neo-
corporative model to the prospect of sustaining a strong attack on CITUB and to con-
sent to the narrowing of the scope of tripartite collaboration.

Reconstruction of the employers’ parameter of tripartite collaboration – the march

of neo-liberal concepts
It should be noted that at the beginning of 1993, when the newly-formed NCTC began
its operations, no action had been undertaken in connection with establishing the degree
to which the employers’ associations announced as nationally representative answered
the criteria of representivity as set out by the Labour Code. In addition, in 2003 the term
of trade union representivity expires, after which it should be re-established which un-
ion organisations answer the criteria of representivity – and which do not.
Even so, at the end of the government of Ivan Kostov’s cabinet, a certain ‘hyper-
activity’ appeared with respect to some newly-formed, nationally non-representative

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 Evolution of the model of industrial relations in Bulgaria 1989 – 2002

employers’ organisations which brought into question all the achievements in the
sphere of social partnership during the previous twelve years. The established neo-
corporative model of tripartite collaboration (with the substantial participation of the
state, workers’ associations and the gradually increasing importance of the structuring
into a movement of employers’ associations) did have opportunities to develop suc-
cessfully into a scheme of social partnership so typical of EU countries. However, this
was not appreciated by representatives of large-scale capital, who had already gained
some inertia.
The present Government of Simeon SaxeCoburgGotha happens to be under the
permanent pressure of the newly-established Employers’ Association of Bulgaria
(EAB) (www.eabg.org), of the Association of Foreign Investors in Bulgaria – officially
called the Bulgarian Industrial Business Association – BIBA (www.biba.bg) and, to
some extent, of the Bulgarian Business Club ‘Vazrajdane’ (which should not be con-
fused with the Bulgarian Union of Private Entrepreneurs ‘Vazrajdane’. The former
unites some major business people in Bulgaria – bankers, media magnates, gambling
bosses and industrialists; actually, it is the only one which has the character of a busi-
ness club and is not nationally representative. In contrast, the Bulgarian Union of Pri-
vate Entrepreneurs (BUPE) ‘Vazrajdane’ is a formal, nationally representative, asso-
ciation of small investors but has functions that are fast fading away.) The Cabinet
needs to manoeuvre between the radical, neo-liberal claims of the EAB and the under-
standable desire of employers not to give up positions achieved as a result of long ne-
gotiations between the social partners and the exhausting demands of consensus.
Claims for a new Labour Code, providing employers with almost limitless opportuni-
ties to get rid of their workers whenever they like and without compensation, and for
a drastic restriction of trade union rights, are not only an interruption of the polite tone
of the social partnership but are also a gauntlet thrown down before workers, officials
and their representative associations.
Under these circumstances of growing social confrontation, and under a serious
lack of space for social manoeuvre, the Government has turned out to be in a very
complicated situation. And, again, it has undertaken a rather dubious step, from a tac-
tical point of view, by founding an institution in which only the pressure groups of
large-scale business can be especially associated. It is undisputable that the Govern-
ment needs to be in constant dialogue with large-scale entrepreneurs, in order to be
aware of their claims and the reasons for them, but the institution it has created – the
Economic Growth Council (EGC) – associates some nationally-representative em-
ployers’ associations together with nationally non-representative employers’ associa-
tions. The EGC actually doubles to a great extent the work of the National Council of
Tripartite Collaboration. (In the EGC take part the Employers’ Association of Bul-
garia (EAB), the Bulgarian Business Club ‘Vazrajdane’, the BIA, BCCI, and the As-
sociation of Foreign Investors in Bulgaria – BIBA.) It is clear that, owing to the ag-
gressive behaviour of the newly-founded EAB, the representative employers’
associations are unable not to radicalise as they do not want to experience an exodus
of their members. Willing or not, they should keep on the outside edge of such a pecu-
liar institution as the Economic Growth Council.

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 Teodor Detchev

However, the Cabinet was not obliged to institutionalise the natural will of large-
scale capital to have a point for lobbying the executive directly. Even so, it undertook
an action which can be assessed in terms of its potential for re-orientation, increasing
to some extent the development of industrial relations in the direction of a neo-liberal
model. Of course, no-one believed that the foundation of the Economic Growth Coun-
cil would make the relationship between the Government and large-scale capital more
transparent. Furthermore, the anti-corruption association of non-governmental organ-
isations – ‘Coalition-2000’ – provided a negative assessment of the foundation of the
Council. Many of the problems discussed at the EGC are either within the compe-
tence of the Ministry of the Economy (given that tripartite collaboration at sectoral
and branch level has never been particularly advanced in Bulgaria), or that of the
NCTC, or else could be set in front of the Prime Minister by the representative em-
ployers’ associations without it being necessary to have a separate institution founded
for that purpose. At the same time, almost all the members of the newly-founded em-
ployers’ structures (for example the EAB) also participate in the BIA, as well as in the
BCCI, and it is unlikely that this would refuse to represent them.
In making such concessions to one of the parties in the system of industrial rela-
tions, the Government is generating problems for itself: conditions of stress accumu-
lation rise, and their settling will, later, be one of its subsequent problems. Another is-
sue is that it will scarcely be able to rely on the ‘eternal gratitude’ of employers
participating in the EGC. They will never save the Government from any situation in
which their interests are threatened or where their opinion does not coincide with the
position of the executive.

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56 South-East Europe Review 1/2//2003

 Evolution of the model of industrial relations in Bulgaria 1989 – 2002

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