Accounting, Payroll, Tax & Legal since 1989

Amendments to Labour Law came into force

In this article, we will highlight the most important amendments to the Labour Law which came into force on 16 August 2017.

Hourly salary rate. Until now, the procedure for calculating average earnings has been only specified in the law. Now, a new article is introduced which specifies a calculation of hourly salary rate i.e., dividing a fixed monthly salary of an employee with a number of working hours in a month concerned. If an aggregated working time is set for an employee, the hourly salary rate is calculated by dividing monthly salary with average number of working hours of a calendar year.

Overtime. Changes to the law foresee that simultaneously with an agreement on overtime or posting, an employee and employer may agree that overtime premium shall be substituted with a paid vacation at another date according to a number of hours worked and procedure for granting a leave period.

If the overtime premium is replaced with a paid holiday, it must be granted within one month from a date of overtime. In case of aggregated working time of an employee, a leave must be granted in the next reporting period no later than within three months.

Supplementary leave. According to amendments to the law, the supplementary leave for the current year must be allocated and used until annual leave of following year. The reimbursement is not allowed except a situation of termination of employment relationship and if an employee has not used the annual supplementary leave.

Competition restriction. The amendments stipulate that an agreement on competition restriction may be applied to different types of restrictions including competetive economic activity of employee, employment with another employer, poaching of a client or former employee. In the event of termination notice by an employer, the employer may unilaterally withdraw from the agreement on competition restriction only prior or simultaneously with the notice and in other termination cases, before termination of employment contract.

In addition to the above, the amendments to the law also include a new version of article on the collective agreement and its parties and few terminology clarifications.


Latest articles



Baltic tax rates from 1 January 2022



Amendments to the VAT, PIT and State Social...



Employment collective agreement and additional employee benefits without...


Email again: