HR Software for Lithuania

Leave Policy

Maternity Leave

Pregnant employees who have social security maternity certificates for at least 12 of the previous 24 months are entitled to 126 days of paid leave. 70 days must be taken before the birth of the child. The remaining 56 days must be taken after the birth of the child. The employee receives 77.58% of her salary during this period and the State Social Security Agency is responsible for payment.

In the event of birth complications or multiple births, the employee can extend the vacation by an additional 14 paid days.

You can use the leave module in IceHrm to manage maternity leave in Lithuania

Paternity Leave

Employees who meet the requirements for paternity leave (see below) are entitled to 30 days of paid paternity leave. The employee receives 77.58% of his salary during this period and the State Social Security Fund is responsible for this remuneration.

Requirements for entitlement to paid paternity leave:

  • An employee who has been insured
  • Employees who have been granted paternity leave in accordance with the procedure prescribed by law
  • Employees who were socially insured for at least 12 months in the last 24 months before the first day of paternity leave

Parental Leave

Childcare allowance is a benefit paid to a parent (adoptive parent), grandparent or guardian who cares for the child.

It is calculated in proportion to income and depends on the time scale chosen:

  • The insured employee chooses to receive a benefit until the child is one year old – 77.58% of the salary
  • The employee chooses an allowance until the child reaches the age of two – 54.31% of the wages for the first year and 31.03% of the wages for the second year
  • In the case of multiple births, the allowance depends on the number of children born, but does not exceed 77.58% of the salary.

The State Social Insurance Fund is responsible for this remuneration.

When adopting a child, childcare benefit is paid for either 12 or 24 months, regardless of the age of the adopted child and until the child turns 18. The amount amounts to 77.58% of the salary if the benefit is received for one year , and to 54.31% for two years.

The State Social Insurance Fund is responsible for payment.

Sick Leave

There is no maximum number of days for sick leave. The first three days are paid by the employer, with the employee receiving 62.06% of their salary. After three days, workers will receive 62.06% of their salary, which will be paid by the State Social Security Agency.

Leave to care for a sick family member or child is paid from day one. During this leave, employees receive 65.94% of their salary. The State Social Insurance Fund Board is responsible for this payment.

Employees are entitled to sick pay if they:

  • Become temporarily unable to work
  • Have health insurance through social security
  • Absent from work due to illness and loss of earnings
  • Are insured and have been socially insured for at least three months in the last 12 months or at least six months in the last 24 months
  • Do not have proof of health insurance because they studied until the age of 26 or work as a professional soldier or civil servant
  • Have submitted an application for benefits to the regional office of the State Social Insurance Fund no later than 12 months after the end of the illness

Pay & Tax

Minimum Wage Requirements

The minimum gross monthly salary is EUR 924.

Individual Income Tax

Individual income tax is either 20% or 32%. Income tax is calculated at a flat rate. The income tax rate of 20% is applied to income amounts below EUR 81,162 (60 average wages) per calendar year in 2021, and an income tax rate of 32% for incomes exceeding EUR 81,162 per calendar year in 2021.

Payroll Cost

The cost to the employer is generally estimated at 1.77% of the employee’s salary.

  • Social insurance in case of unemployment – 1.31%
  • Payments to the fund – 0.16%
  • Contribution to the Long-Term Employment Fund – 0.16%
  • Social insurance against industrial accidents and occupational diseases – 0.14%

Overtime Pay & Maximum Hours

Pay for overtime is mandatory. Hours outside of normal working hours are considered overtime. Employees can work a maximum of 48 hours of overtime per week. Employees can work a maximum of 180 hours of overtime per year. For additional hours, employees receive 1.5 times their regular salary.

The standard working hours are eight hours per day and 40 hours per week. The normal working week lasts from Monday to Friday.

Termination

Termination Requirements

Dismissals must take into account complex rules and the regulations of the country in which an employee is employed. Off-boarding is always carried out by the employer with the main participants. It may include ad hoc fees as well as mandatory or recommended steps for specific termination cases.

Compliant terminations include:

  • Voluntary by the employee
  • By mutual agreement
  • Unilaterally by the employer for valid reasons or for no reason
    Probation period
    Objective reasons
    Dismissal for disciplinary reasons
    Performance due to unsuitability for the position
    Function that has become redundant due to a change in the organizational structure

Notice Period

The notice period depends on the reason for termination and the duration of the employment relationship.

Termination of the employment relationship at the initiative of the employer through no fault of the employee:

  • Ordinary termination: one month’s notice period
  • Less than one year of employment: two weeks’ notice
  • The notice periods mentioned above are multiplied by a factor of three for:
    Employees raising a minor (including adopted) child under 14 years of age
    Employees raising a disabled child under 18 years of age
    Disabled workers
    Employees who will be entitled to a retirement pension in two years

Termination of an employment contract at the request of the employer:

  • Three days’ notice for the employee
  • Pregnant women and employees who are on maternity, paternity or parental leave cannot be dismissed on this legal basis

Termination of an employment contract at the initiative of the employee without good reason:
The employee must submit a written notice of termination with at least 20 days’ notice.

Termination of an employment contract at the initiative of the employee for valid reasons:

  • The employee cannot give the employer a shorter notice period
  • The Labor Law allows the employer and the employee to agree that the employee will not work during the notice period but will be paid for the entire notice period.

Severance for Employees

The amount of the severance payment depends on the reason for termination and the duration of the employment relationship.

Termination of the employment relationship at the initiative of the employer through no fault of the employee:

  • If the period of employment is more than one year – two average monthly salaries
  • If the period of employment is less than one year – 0.5 average monthly salary
  • In addition, the dismissed employee receives severance pay from a special state fund. The amount of the severance payment depends on the duration of the employment relationship.

Termination of an employment contract at the request of the employer:

  • At least six average monthly salaries

Termination of an employment contract at the initiative of the employee for valid reasons:

  • If you have been employed for more than one year: twice the average salary
  • If you have been employed for less than a year – an average salary

To protect you from unforeseen financial risks resulting from dismissals, IceHrm applies a severance pay provision in all employment contracts in this country. IceHrm has extensive expertise in managing litigation risk around the world and our severance provision calculation is based on prevailing common law or statutory requirements and best local practices. If your employee resigns or is not entitled to severance pay, you will receive a refund of any unused amounts.

Statutory Time Off

Paid Time Off

Full-time employees who work five days per week are entitled to 20 days of paid time off per year, while full-time employees who work six days per week are entitled to 24 days of paid time off per year. Part-time employees are entitled to 20 days pro rata. PTO is credited monthly at 1.67 days per month.

In the first year of employment, all annual leave is normally granted after at least half the working days per working year. At the request of an employee who has worked continuously for less than six months, annual leave is granted for:
1) pregnant employees before or after maternity leave
2) Female employees during their child’s maternity leave, before or after paternity leave
3) with the permission of the employer

Public Holidays

There are 15 national holidays in Lithuania. National holidays include:

  • New Year’s Day
  • Day of Restoration of the Lithuanian State 
  • Lithuanian Independence Restoration Day 
  • Easter Sunday
  • Easter Monday 
  • Labour Day
  • Mother’s Day 
  • Father’s Day
  • St. John’s day
  • Statehood day
  • Assumption Day
  • All Saints’ Day
  • All Souls Day 
  • Christmas Eve
  • Christmas Day

Onboarding

Onboarding

Onboarding takes 2 working days.

Additional Info

Employment Contract Details

The contracts must be written in Lithuanian and can be bilingual with English. They must be in writing and signed by both parties.

A contract must contain:

  • Surname
  • Start date
  • Length of employment
  • Probation period
  • Working hours
  • Annual leave
  • Description of the workplace
  • Conditions for termination of employment

Backdating the contract is not permitted.

Probation Period

Employees hired through IceHrm are subject to a probationary period of 90 days, which cannot be extended as it is the country’s maximum limit. From January 2022, IceHrm will include a probationary period in all employment contracts.

The probationary period helps employers and employees make sure they are a good fit for each other. This means the company can quickly decide whether the position is right for them, and the employee can see whether it matches their career goals.