Guide to employment, payroll and benefits in


Rivermate offers complete payroll, benefits and compliance services for


01. Overview

Last updated: 

August 19, 2021

Lithuanian Litas
Ease of doing business
GDP growth

02. Grow your team in


with Rivermate

Payroll, benefits, taxes, and compliance can be difficult to manage in


, particularly if you don't have established local relationships. You can hire employees in


effectively, conveniently, and in full compliance with all relevant labor laws using Rivermate's global employment solution. We handle the responsibilities and legal risks associated with foreign employment so you can concentrate on growing your company.

03. Summary

Lithuania is a country in Europe's Baltic region, officially known as the Republic of Lithuania. It is one of the Baltic states, located on the Baltic Sea's eastern coast, southeast of Sweden and east of Denmark, with Latvia to the north, Belarus to the east and south, Poland to the south, and Russia's Kaliningrad Oblast to the southwest. Lithuania has a population of 2.7 million people and a land area of 65,300 km2. Vilnius is the country's capital and largest city; Kaunas and Klaipda are also important cities. Lithuanians are part of the Balt ethnolinguistic community and speak Lithuanian, which is one of only two living Baltic languages. Various Baltic tribes populated the southeastern coasts of the Baltic Sea for centuries. Mindaugas unified the Lithuanian lands in the 1230s, and the Kingdom of Lithuania was founded on July 6, 1253. The Grand Duchy of Lithuania was the largest nation in Europe in the 14th century, encompassing modern-day Lithuania, Belarus, Ukraine, and parts of Poland and Russia. With the Lublin Union of 1569, Lithuania and Poland created the Polish–Lithuanian Commonwealth, a mutual two-state personal union. The Commonwealth lasted more than two centuries, until it was dissolved by neighboring countries in 1772–1795, with the Russian Empire annexing the majority of Lithuania's land. On February 16, 1918, as World War I drew to a close, Lithuania's Act of Independence was signed, establishing the modern Republic of Lithuania. Lithuania was invaded twice during WWII, first by the Soviet Union and then by Nazi Germany. The Soviet Union reoccupied Lithuania as World War II drew to a close and the Germans withdrew. Lithuania became the first Baltic state to declare independence on March 11, 1990, a year before the official breakup of the Soviet Union, under the name of the State of Lithuania. Lithuania is a developing nation with a high-income advanced economy, ranking very high in the Human Development Index. In terms of civil rights, press freedom, and internet freedom, it scores well. However, since the 1990s, Lithuania has seen a steady population decline, with social problems such as income inequality and a high suicide rate persisting. Lithuania is a member of the European Union, the Council of Europe, the eurozone, the Nordic Investment Bank, the Schengen Agreement, NATO, and the Organization for Economic Cooperation and Development. It is a member of the Nordic-Baltic Eight format of regional cooperation.

04. Public holidays

05. Types of leave

Paid time off

Employees are given 20 days of paid vacation per year.

Public holidays

There are 11 national holidays in the Lithuania. Service hours are shortened by one hour the day before the national holiday (paid, just one hour shorter is indicated in the timesheet). Public holidays are days off from work that are paid.

Sick days

The boss pays 100 percent of the gross wage for the first two days. Employees earn 62.06 percent of their salaries from SODRA after the third sick day (employer does not incur costs). SODRA pays 65.94 percent if the employee is unable to function due to the patient's treatment.

Maternity leave

Employees who are eligible take 18 weeks (126 days) of paid maternity leave depending on a gross monthly pay for the 12 months preceding the start of maternity leave. Complications in labor and multiple births are given an extra two weeks. The maternity income is equal to 77.58 percent of the compensatory earnings of the recipient. This number is based on the person's covered salary for the 12 consecutive calendar months preceding the month in which maternity compensation eligibility occurred. The maternity benefit cannot be less than 228 EUR a month.

Paternity leave

Paternity leave is granted to new fathers for four weeks. The pay estimate is the same as in the segment on maternity leave.

Parental leave

100% paid maternity leave for up to one year. If the adult chooses to accept the benefit before the child turns two, the parent will receive 70% of the benefit before the child turns one and 40% thereafter. The salary calculation is the same as in the segment titled "Maternity Leave."

Other leave

Employees are entitled to 26 days of paid vacation each year. In addition, those workers are entitled to extra time off:Persons who are disabled who have been injured at work are entitled to an additional six days of leave.Employees in the mining industry are entitled to an additional three days of vacation.An employee or apprentice who has not had a consistent rest time of 44 hours per week, plus one extra day for every 8 weeks the employee has not had continuous rest.

06. Employment termination

Termination process

Employers must provide the required notice in order to terminate an employee properly. Notice is calculated based on the length of continuous employment.

Notice period

The standard period of notice is one month. The notice period is two weeks for employees with less than one year of service. The notice periods mentioned previously are increased threefold for employees who are raising a child (also adopted) under the age of 14, employees who are raising a disabled child under the age of 18, disabled employees, and employees who will be eligible for retirement in two years. For employees who will be eligible for a retirement pension in five years, notice periods are doubled.

Severance pay

Severance payments are calculated on the basis of one month's average wage for employees who have worked for the company for less than 12 months. Employees with more than 240 months of service receive up to six months' average wage.

Probation period

Probation periods are not required but are common. They typically last 3 months.

07. Working hours


The standard workweek consists of forty hours spread over five days. Flexible working hours are becoming more prevalent in Lithuania, and some employees may work part of their shifts.


Overtime hours are limited to eight per week (which can be increased to twelve with the employee's consent) and 180 per year. Overtime is compensated at 150 percent of the employee's standard hourly rate, and 200 percent for work performed on a holiday or a day the employee was not originally scheduled to work. Employees who work more than three hours between 10:00 p.m. and 6:00 a.m. or who work more than 25% of total hours during this time period are compensated at 150 percent of the standard hourly rate for night hours.

Employees who work overtime between the hours of 10 p.m. and 6 a.m. or on a day they were not originally scheduled to work earn 200 percent of the standard hourly rate, while employees who work overtime on a holiday earn 250 percent of the standard hourly rate.

08. Minimum wage


Employees in Lithuania must earn at least 642 EUR per month by January 2021 in order to comply with Lithuanian compensation laws. Bonuses are not required, but many employees expect them to be included in their employment contract. Workers with in-demand skills can expect to be paid more for their time as well as receive annual raises.

09. Employee benefits


Lithuania has a national healthcare system. Employees pay 6.98 percent of their gross income for health insurance. There are also private clinics, although few Lithuanians have private health insurance.

All permanent residents of Lithuania are required to obtain health insurance, and workers must register with the health insurance fund of their employer. The majority of services are paid for by the government. The state money does not cover dental treatment.

Supplemental health insurance, a vehicle allowance, a phone allowance, and a fitness allowance are all common perks.

10. Why Rivermate as your Employer of Record / PEO?

Establishing an entity in


to hire a team takes time, money, and effort. The labor law in


has strong worker employment protection, requiring great attention to details and a thorough awareness of local best practices. Rivermate makes expanding into


simple and effortless. We can assist you with hiring your preferred talent, managing HR and payroll, and ensuring compliance with local legislation without the hassle of establishing a foreign branch office or subsidiary. Our PEO and Global Employer of Record solutions in


give you peace of mind so you can focus on running your business.

Please contact us if you'd like to learn more about how Rivermate can help you hire employees in


via our Employer of Record / PEO solution.

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