- Overview: Lithuania
- Global HR Compliance
- Global PEO and payroll
- Work Permit for Hiring Expats via EOR
- Contractor vs. Employee: Which Is Better?
- Expand without a Company Set Up
Global HR Compliance in Lithuania
If you need to hire a foreign workforce in Lithuania to expand there, then our Global Employer of Record solution may help. We help you legally hire and reward your foreign workforce by making them employees via a global employment outsourcing service. This is simple as employing your in-house workforce, with the only difference being that workers can live anywhere in the world, and Acumen International would be their legal employer on your behalf. This means we would bear all employment risks, not you. Also, we manage bonuses, vacations, and sick leave and can rent the office and a car for your foreign sales representatives if needed.
With the Global Employment Solution solution, you can test new foreign markets before deciding whether you will get established there. You gain flexibility, expand with reduced costs, and easily withdraw from unattractive countries.
We are experts in global workforce employment in Lithuania, and our goal is to become your single provider. Instead of working with numerous local staffing agencies and legal advisors, Acumen International can solve your global business challenges and save you time, costs, and resources.
Our team of English-speaking professionals frees you from working through language nuances. Acumen International works 24/7 and can assist you whenever you need, regardless of time zones. We aim to create tailored labor solutions for you that are managed legally and fully compliant with the local employment laws.
With our knowledge and deep understanding of local nuances, you easily satisfy your need for skilled professionals in your global industry. With our qualified local partners, you can trust that your global workforce satisfies all local tax, social security, and immigration requirements in Lithuania.
Hiring and Firing Workforce in Lithuania Guide
An employment contract must be concluded in writing. Each employment contract shall have the following terms: workplace and employee functions. Two copies of the written employment contract must be drawn up and signed by the employer (or his authorized person) and the employee. One signed copy must be handed to the employee, whereas the employer must keep the other. The employment contract must be registered in the employment contracts record book on the same day. Such a book is not mandatory if the employer employs three or fewer employees.
Employment contracts may be non-term, fixed-term, temporary, seasonal, on additional work, secondary job, with home workers, on the supply of services, and others. As a rule, an employment contract is concluded for an indefinite period of time (non-term).
Minimum (Statutory) Employment Rules and Regulations in Lithuania
Working time may not exceed 40 hours per week. A daily period of work must not exceed eight working hours. Laws, Government resolutions, and collective agreements may establish exceptions.
Maximum working time, including overtime, must not exceed 48 hours per 7 working days. Employees working in specific sectors (e.g. health care, care (custody), child care institutions, specialized communications services, and specialized accident containment services and security may be required to work up to 24 hours per day. The duration of working time of such employees must not exceed 48 hours per seven-day period, and the rest period between working days must not be shorter than 24 hours. The Government approves the list of such jobs. For employees employed in more than one undertaking or one undertaking but under two or more employment contracts, the working day (including breaks to rest and to eat) may not be longer than 12 hours.
The parties may agree on a probation period. It may be used to assess an employee’s suitability for the agreed work and at the request of a person taking on a job to see if the job is for him. The probation period must be set in an employment contract. A probation period may not be longer than three months. Longer probation periods may be applied in certain cases specified by laws, but the probation period cannot exceed six months. Currently, no laws specify when the trial period can exceed six months.
A trial to assess the suitability of an employee for the agreed work may not be established when employing persons:
- under 18 years of age;
- to a post by competition or elections, as well as those who have passed qualification examinations for a post;
- due to a transfer by agreement between employers, to work for another employer;
- in other cases specified by labour laws.
Suppose an employer is not satisfied with an employee’s performance during the trial period. In that case, he may dismiss the employee from work before the expiry of the trial period by giving the employee three business days written notice without paying them severance pay.
The minimum annual holiday is normally a period of 28 calendar days. 35- days holidays are granted to certain employees (under 18 years of age, single parents, disabled persons, etc.) Annual leave may not be shortened for part-time employees. The holiday for part-time employees is calculated proportionally to how much they work. However, the annual holiday may not be shortened for part-time employees and must last at least 28 calendar days.
Women are entitled to maternity leave of 70 calendar days before birth and 56 calendar days after birth (in the event of complications or the birth of two or more children – 70 calendar days). This leave is added up and granted to the woman as a single period, regardless of the days used before the birth.
The amount of maternity pay is calculated based on the employee’s income received within 12 calendar months before the month’s leave began. Where more than one child is born, the maternity allowance shall be paid for additional 14 days.
An employer may request an applicant to undergo a health examination. Disabled persons and ill persons, in the meaning of Lithuanian labor laws, enjoy wider protection in employment relations.
The minimum wage in Lithuania is €380 per month ($425.23), divided to €2.31 per hour ($2.57). Lithuania’s minimum wage was last changed in July 2016.
In all cases, the termination of an employment contract must comply with the terms of the contract. In most cases, certain minimum steps must be followed before termination to avoid the termination amounting to unfair dismissal. An employer must be able to demonstrate a “potentially fair” reason for dismissal.
An employment contract will expire:
- upon the termination thereof on the grounds established by the Labour Code and other laws (termination of the employment contract by mutual agreement, upon contract’s expiry, upon the notice of the employee, due to circumstances beyond the Employees control, on the initiative of an Employer without any fault on the part of an Employee;
- upon the liquidation of an employer without a legal successor; and
- the death of an employee. For every type of termination, the procedural requirements differ.
An employment contract must be terminated without notice in the following circumstances:
- Upon an effective court decision, or when a court judgment imposes a custodial sentence on the employee, which prevents him from continuing his work;
- when an employee is deprived of special rights to perform certain work in accordance with the procedure prescribed by laws;
- upon the demand of bodies or officials authorised by laws;
- when an employee is unable to perform these duties or work in accordance with an opinion of the medical commission or the commission for the establishment of disability;
- when a parent, statutory representative, doctor or school of an employee between the age of 14 and 16 years demands that the employment contract be terminated;
- upon the liquidation of an employer.
An employment contract will expire upon the death of an employer if the contract was concluded for the supply of services to him personally, as well as when the employer has no legal successor.
An employer will be entitled to terminate an employment contract without giving an employee prior notice under the following circumstances:
- When the employee performs his duties negligently or commits other breaches provided that disciplinary sanctions were imposed on him at least once during the last 12 months;
- When the employee commits a gross breach of duties. The term of “gross breach of duties” is specified in the Labour Code.