Lithuania
Amendments regarding calculation of average wage, duration of annual leave, working and rest time
Impact date: 30 October 2025 (provisions regarding calculation of annual leave entered into force on 1 January 2026) Government Resolution “On the Implementation of the Labor Code of the Republic of Lithuania” has been amended. The amendments cover updates to the procedure for calculating the average wage, the list and duration of extended annual leave for certain employee categories, and specific rules on working time and rest time in various economic sectors.
Employer implications/action needed Employers must:
- review and, if necessary, adjust internal payroll policies to align with the revised average wage calculation procedure
- verify employee categories entitled to extended annual leave and update internal HR documentation accordingly
- ensure compliance with new working time and rest time provisions applicable to relevant economic sectors
- communicate the updated rules to HR and payroll personnel responsible for employment administration
Employer risk
- failure to apply the correct wage calculation methodology may result in overpayment or underpayment claims
- misapplication of leave entitlements may lead to employee complaints and potential labor dispute
- non-compliance with sector-specific working time provisions could trigger inspections by the State Labor Inspectorate and administrative penalties
Late-payment interest rate for employment-related payments
Impact date: 1 February 2026
The late payment interest rate for wages or other employment-related payments, when delayed due to the employer’s fault before the termination of employment (as established in Article 147(1) of the Lithuanian Labour Code), remains at 0.1%.
Employer implications/action needed Employers must always ensure timely payment of salary and all employment-related amounts in order to avoid statutory late-payment interest.
Employer risk Financial risk, as well as employee-relations risk as delays may undermine trust and lead to complaints/disputes.
Proposed amendments to transpose the EU Pay Transparency Directive
Impact date: Not yet adopted; likely implementation by June 2026, aligning with the Directive’s transposition deadline. State institutions have publicly indicated that the relevant amendments to the Labour Code are expected to enter into force by the transposition deadline. Employers should plan and prepare on the basis that the new requirements will apply from 7 June 2026.
An updated draft amendment to the Lithuanian Labor Code has been registered to transpose the EU Pay Transparency Directive into national law. The proposed changes mainly reflect the requirements of the Directive (e.g., enhanced pay gap reporting obligations, requirements for all employers to establish formal, gender neutral remuneration systems etc.).
The draft has now been returned to the Ministry of Social Security and Labour for further improvement. As a result, the final wording of the national provisions is not yet confirmed. The regulatory approach and core employer obligations are not expected to change, as Lithuania is required to fully implement the Directive.
Employer implications/action needed
Employers must:
- familiarize themselves with the EU Pay Transparency Directive and its requirements, as well as the proposed implementation into Lithuanian law
- monitor legislative progress in Lithuania, as the draft wording is not final and may change
- plan ahead for compliance by reviewing current pay structures and identifying gaps early
- prepare to update/adopt internal policies (e.g., remuneration systems, recruitment practices) once the law is adopted. The State Labour Inspectorate has prepared recommendations for developing remuneration systems, which should help employers assess their current situation and identify the necessary actions for the practical implementation of the Directive (link: 2026-02-02 Recommendations regarding paygap.pdf (available only in Lithuanian))
Employer risk Failure to comply with the new proposed requirements could lead to disputes with employees and administrative fines. For example, failure to provide pay information to employees, their representatives or the State Labor Inspectorate could result in fines between €460 and €700 (a repeated breach could lead to fines between €700 and €1,400). These penalties may change as the transposition of the Directive is not yet finalized.
Link https://e-seimas.lrs.lt/portal/legalAct/lt/TAP/d61902e0f60811f0b9baf24db8ed7e40?jfwid=-i9h8eqryl (latest draft version, currently returned to the Ministry of Social Security and Labour for further improvement)
Amendments to the Law on the Fundamentals of Protection of the Rights of Persons with Disabilities
Impact date: 1 July 2026
Amendments to the Lithuanian Law on the Fundamentals of Protection of the Rights of Persons with Disabilities have been adopted. The Law was updated to expand Article 10, introducing a recommendation for private-sector employers with 25 or more employees to meet a certain criterion – namely, that employees with disabilities should make up at least 5% of the total workforce.
Employer implications/action needed
As it is only a recommendation, private-sector employers are free to decide whether to follow it. Employers may review their diversity and inclusion policies.
Employer risk There is no direct legal or administrative risk, as the requirement is non-binding.
Proposed amendments to the Lithuanian Labour Code
Impact date: Not yet adopted; if adopted, the amendments will enter into force on 1 November 2026.
A draft amendment to the Lithuanian Labour Code has been registered, proposing updates across several areas, including:
- allowing a probationary period of up to six months for employees whose monthly salary is at least two times the national average gross wage; for fixed-term employment contracts shorter than 12 months, the probationary period must be proportionate (i.e., shorter than six months)
- setting strict rules for the final wage settlement: the part not exceeding one month’s average wage must be paid no later than on the employment termination date, or, if agreed, within ten business days. The part exceeding one month’s average wage may be paid at another mutually agreed time, but no later than three months from the employment termination date
- Revising default interest for late payments during ongoing employment (due to the employer’s fault): default interest is payable for each delayed calendar day from the due date, with the rate approved annually by the Minister of Social Security and Labour by 1 February, and calculated using the Consumer Price Index (comparing last December with December of the previous year) multiplied by five
Employer implications/action needed
Employers must:
- review and, if necessary, adjust internal policies/template employment contracts to reflect the proposed changes (e.g., remuneration rules, settlement procedures)
- monitor the legislative process, as the draft is not yet adopted and further modifications may occur
Employer risk Failure to apply may result in employee claims and/or administrative liability for the employer.
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