At this year’s HR Innovator Conference 2025 in Sofia, legal expert Hristo Mashkov from Milanova & Partners Law Firm and the European Law Firm delivered a session that couldn’t have been more timely—or more essential. Titled “What Every HR Leader Should Know,” the talk addressed how HR professionals can avoid critical legal missteps in hiring, termination, and employee management, while also embracing compliance as a strategic advantage.
As HR continues to evolve into a strategic powerhouse, legal literacy is no longer optional. HR leaders must not only champion people and culture but also ensure that their practices meet the rigorous demands of labor law, data privacy, and regulatory compliance.
Hiring & Termination: Navigating Legal Complexity
Hiring and termination might seem like routine processes, but when handled incorrectly, they can expose organizations to significant legal risk. One of the most important reminders was that a job offer is not legally binding until it is signed. Without a formal employment agreement, no legal employment relationship exists.
Moreover, HR professionals were cautioned against using generic employment contracts. Every contract must comply with Article 66 of the Bulgarian Labour Code, which mandates the inclusion of key clauses such as the employee’s position, remuneration, working hours, location, start date, and a clear job description.
Terminations must also be based on well-defined legal grounds. Vague justifications or poor documentation can result in dismissals being ruled unlawful. In redundancy situations, companies must apply objective selection criteria and keep meticulous records. And no matter the situation, timely payment of all compensation is a legal requirement that cannot be overlooked.
Disciplinary Terminations: Precision Is Everything
When it comes to disciplinary actions, the legal thresholds are even higher. Violations must be clearly classified under Article 190 of the Labour Code, and employers must initiate disciplinary procedures within two months of becoming aware of the breach (per Article 194).
Employees have the right to present their side of the story—this is not only ethical but legally required under Article 195. Any disciplinary dismissal must culminate in a written order that specifies both the legal basis and the justification. Failing to follow these steps puts the employer at risk of having the dismissal reversed or penalized in court.
Data Privacy in HR: A Legal and Ethical Mandate
The session also addressed the increasing importance of data privacy, especially in the HR domain where personal information is collected, stored, and processed extensively. In compliance with the General Data Protection Regulation (GDPR) and the Bulgarian Personal Data Protection Act, employers must ensure transparency in how they handle employee data.
Employees must be clearly informed about what data is collected and for what purpose. When personal data is used for non-essential purposes—such as company photos or future recruitment outreach—separate and explicit consent must be obtained. Respecting these requirements not only ensures legal compliance but also builds trust within the organization.
Remote Work, Flexible Benefits & Compliance by Design: Adapting to the Future
The legal framework is also adapting to new work models. Remote work, now a standard practice in many organizations, is governed by Articles 107b to 107e of the Labour Code. It requires a written agreement between the employer and employee, and employers must provide necessary equipment, ensure safe working conditions, and guarantee equal access to training and opportunities for remote employees.
Flexible benefits were also highlighted as a powerful tool for talent attraction and retention. These may include food vouchers, supplementary health insurance, transport assistance, or additional vacation days. Some of these benefits are eligible for tax advantages under Bulgarian tax legislation, but companies must ensure they remain within the legal boundaries of minimum entitlements and avoid any discriminatory practices.
Perhaps most strategically, the concept of “compliance by design” emerged as a forward-thinking approach. This means integrating legal compliance into HR processes from the outset—not just in labor law, but also in GDPR, occupational health and safety, and anti-discrimination regulations. When done well, this proactive stance reduces risk, closes legal gaps, and enhances the organization’s reputation as a responsible and attractive employer.
Final Thought: Compliance as a Strategic Advantage
One of the session’s most important takeaways was that legal compliance is not just a defensive measure—it’s a strategic asset. In today’s workplace, where trust, transparency, and fairness are at the core of employer branding, being legally sound enhances your credibility and competitiveness.
A big thank you to the HR Innovator Conference team, the insightful speakers, and all participants who are helping to shape a more informed, compliant, and human-centered future for HR.
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