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Labour Code Amendments - Lithuania

The newly adopted amendments of the Labour Code of Republic of Lithuania (LC) establish additional rights for employees taking into account their state of health, as well as establish certain new rules for concluding, executing and terminating employment contracts. We invite you to have a look at the relevant amendments that entered into force on 1 August 2020. 


 

New Rights of the Employees Related with their State of Health

Prohibition of discrimination on the grounds of state of health – the scope of prohibited discriminatory grounds is expanded. It is forbidden to discriminate not only on the grounds of employee’s disability but also on the state of health of the employee (Amendment of Part 1 of LC Article 26). The emergence of a new prohibition of discrimination on the state of health accordingly creates additional responsibilities to employers.

Remote work – an employee, depending on his/ her state of health, has the right to require to work at least one-fifth of the total working time remotely. The employer is obliged to comply with employee’s request if it is based on his/ her state of health (Amendment of Part 2 of LC Article 52).

Annual leave – an obligation for the employer to comply with the employee's request for annual leave if the employee bases his/ her request on the conclusion of the health care institution about their state of health (Amendment of Item 4 of Part 5 of LC Article 128). This applies on granting annual leave in both cases:

-       before six months of uninterrupted employment, when the employee has newly joined the workplace;

-       when the leave is not foreseen at the annual leave schedule concluded in the workplace.

Unpaid leave – an obligation for the employer to comply with the employee's request for unpaid leave if the employee bases his/ her request on the conclusion of the health care institution about employee’s state of health (Amendment Item 4 of Part 1 of LC Article 137).



Conclusion, Execution and Termination of Employment Contracts

Expanded circle of family members – the LC amendments systematically expanded the circle of family members, providing that custodians are now recognized as family members. A wider circle of family members will have to be assessed in order to avoid discrimination against employees while concluding, executing or terminating employment contracts (Item 3 of Part 1 of LC Article 56). Additionally, the concept of a "child" now includes adoptive children, foster children and children under guardianship (Amendment of Part 1 of LC Article 2).

Temporary conclusion of a fixed-term employment contract for a position subject to competition – a possibility of temporarily recruiting an employee without a competition for a position which is a subject to competition. The maximum term of such an employment contract is 1 year (Amendment of LC Article 41).

Termination of a fixed-term employment contract – the elimination of restriction on terminating a fixed-term employment contract. The employee is now allowed to terminate a fixed-term employment contract, which was concluded for a period shorter than 1 month (Amendment of Part 1 of LC Article 55).

Termination of the employment contract in the event of the decision ending the employer – the legislator eliminated the legislative gap when the contracts of employment needed to be terminated due to the decision ending the employer (e.g. in case of liquidation). The amendment provides the possibility of notifying a pregnant worker or until the baby is four months old regarding the termination of the employment contract in the event of a decision (by a court or governing body of the employer) terminating the employer (Amendment of Part 1 of LC Article 61). In accordance to LC Article 57 Part 7 (which was also amended) the pregnant employee must be notified regarding the termination 3 months in advance or 6 weeks in advance if the employment relationship lasts for less than one 1 year.

In the event of the end of the employer it is now also possible to terminate the employment contract with employees who are raising a child under the age of 3 (including employees on parental leave). This was not possible under the previous regulation. There is now also the possibility of terminating the employment contract if the employee does not agree to the continuation of the employment relationship in the event of a transfer of the business or part of it (Amendment of Part 3 of LC Article 61).

Unification of severance pay for termination of employment contract due to the employee's state of health or the need to care for a family member – the employee must be paid severance pay of 2 employee’s average salaries upon the termination of employment contract in these cases:

-       on the employee's initiative due to important reasons when the employee‘s state of health or the need to care for a family member no longer allows the continuation of the employment relationship;

 

-       without the will of the parties of the employment contract when the employee, based on the conclusion of the health care institution about the state of health of the employee, is unable to perform duties.

According to adopted changes, employee shall now receive the same severance payment in case the termination happens based on one of these grounds.

Calculation of penalties after the termination of employment contract – if, upon termination of an employment relationship, the employer is late to pay to the employee the outstanding amounts without the fault of the employee, the employer shall pay a penalty for factually delayed days (Amendment of Part 2 of LC Article 147)

Payment of severance pay when terminating the employment contract with the head of the legal entity – if the employment relationship with the head of the legal entity has lasted for more than 2 years and he/ she is removed from the position, he/ she shall be paid the severance pay of 1 average monthly salary (Amendment of Part 2 of LC Article 104). The previous regulation provided that the severance pay would belong to the head of the legal entity only if he/ she was revoked after at least 2 years of employment, but before the expiry of the employment contract. Keep in mind, that the parties are free to agree on higher severance pays.



Individual Types of Employment Contracts and the Content of the Employment Contract

Apprenticeship contract – provided an opportunity for small companies (up to 10 employees) to conclude one apprenticeship contract (Amendment of Part 3 of LC Article 83). The previous regulations have stipulated that apprenticeship contracts in the workplace may not exceed 1/10 of all valid employment contracts.

Project-based contract – introduced the possibility to conclude a project-based employment contract for a term longer than 2 years. In case the project term is longer, the employment contract may be concluded for the term of the project, but no longer than 5 years (Amendment of Item 1 of Part 3 of LC Article 89).

Compensation for those working in outdoor conditions – a requirement to pay compensation to an employee if the employee works in outdoor conditions (compensation of the increased costs for working in outdoor conditions for the factual outdoors working time) (Amendment of Part 8 of LC Article 144).


At Leinonen we aim to provide up to date information regarding the latest changes and development in the business sphere of Lithuania. We suggest that you follow our LinkedIn page for news, discussions or general communication with us - LinkedIn/Leinonen. 

For queries related to payroll, accounting, tax & legal or opening a company in Lithuania - contact a member of our team. We offer high-quality accounting and financial management services, enabling clients to focus on their core business.

20.08.20


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