Latvia is a Baltic country in northern Europe, bordered by Estonia, Lithuania, Russia, Belarus, and the Baltic Sea. It is considered a developed country with a high-income economy, and ranks highly in the Human Development Index. Ethnic Russians have became the most prominent minority in Latvia (now making up nearly 25% of the population) due to extensive immigration during Soviet occupation.Latvia is known to have civil liberties, press freedom, internet freedom, democratic governance, good living standards, and peacefulness.
The minimum wage in Latvia is EUR 500, and a standard workweek is 40 hours at 8 hours per day. Overtime work must be mutually agreed upon by the employee and employer, and is usually paid at 200% of the regular salary.
Pregnant employees in Latvia are entitled to 112 days of paid maternity leave, of which 56 days must be taken before the due date and 56 days must be taken after the birth. This leave is paid by social security at 80% of the employee’s average salary.
Fathers are entitled to 10 days of paid paternity leave, paid by social security at 80% of the employee’s average salary. Either parent can also take 18 months of parental leave before their child is 8 years old, paid at between 43.75%-60% of their average salary.
Employees who have worked at a company for at least 1 month are entitled to sick leave for 10 days, paid by the employer at 75-80 of the average salary. If the sickness lasts more than 10 days the employee can receive the Sick Leave Benefit for up to 52 weeks (in a period of 3 years).
There are 12 national holidays in Latvia, and employees who have worked at least 6 months at their company are also entitled to at least 4 weeks of paid time off each year. At least 2 of the weeks of leave need to be taken consecutively.
Employers can terminate a contract for reasons relating to business, personal, or misconduct. A written notice and explanation is required. If the reason for the termination is misconduct, there has to be a warning given so the employee has a chance to explain their actions.
The statutory notice period for terminations is 1 month.
Severance pay depends on how long the employee has worked at the company:
★ 20.77%-23.59% - Social Insurance
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Unlike full-time employees, contractors work on projects with multiple companies at a given time and are technically self-employed. Full-time employees are solely focused on their employer and usually receive benefits (such as health insurance, equity or stock options, and time off) as an additional form of compensation. While it can be cheaper to work with international contractors instead of paying benefits to a full-time employee, you run the risk of misclassification. It's recommended to work with an EOR for contractor onboarding and payments, so you can know that your international contractors are paid compliantly and on time.