The default and most common employment relationship in Lithuania, concluded for an unlimited duration. Can only be terminated by the employer on statutory grounds with the applicable notice period and, where required, severance pay.
Fixed-term contracts may be used for temporary/specific-duration work up to 5 years. Successive contracts for the same function are capped at cumulative 2 years. If work continues after expiry without a formal extension, the contract converts to indefinite. Employers are restricted from using fixed-term contracts for more than 20% of their workforce in permanent-by-nature roles.
Standard working week is 40 hours. Overtime capped at 8 hours per 7-day period (up to 12 with written consent); total weekly hours including overtime generally may not exceed an average of 48. Overtime paid at minimum 150%; rest-day/holiday and night-time overtime at minimum 200%; ordinary night work at minimum 150%.
A probationary period, if used, must be stated in the written contract and is generally capped at 3 months. During probation, either party may terminate by giving 3 working days' written notice without stating a reason, and no severance is payable. Cannot be applied to certain protected categories.
Lithuanian law does not require a 13th or 14th month salary. Discretionary bonuses become a binding contractual (not statutory) obligation once explicitly promised in a contract or CBA.
No broad restriction on job titles, but regulated professions (medicine, law, architecture, engineering, accounting/audit, education) require qualification recognition or licensing. Non-EU/EEA nationals generally need a work permit and residence permit (exemptions for EU Blue Card holders and shortage-occupation roles); some public-sector/defense positions reserved for Lithuanian/EU citizens.
Employer-paid Sodra contributions total approximately 1.77% of gross salary for permanent employees (2.49% for fixed-term) at the lowest risk category: unemployment insurance 1.31% (2.03% fixed-term), Long-Term Employment Benefit Fund 0.16%, Guarantee Fund 0.16%, and occupational-accident insurance 0.14%-1.4% by risk category. No earnings ceiling on the employer-paid portion.
Employees contribute a combined 19.5% of gross salary to Sodra: VSD 12.52% (pension 8.72%, sickness 1.99%, maternity/paternity 1.81%) plus Compulsory Health Insurance (PSD) 6.98%. Once annual income exceeds ~EUR 138,270, the 12.52% VSD portion is capped and only the 6.98% health-insurance contribution continues.
In addition to statutory leave, employees are entitled to the following statutory benefits:
Lithuania's social insurance system is administered by Sodra. Both employer and employee make contributions on gross salary.
Work-injury and occupational-disease protection is delivered through Sodra's mandatory Occupational Accident and Disease Social Insurance, funded entirely by the employer (0.14%-1.4% of gross payroll).
Statutory severance payable when terminated on no-fault grounds, calculated as a multiple of average monthly salary by length of service:
Not payable for fault/misconduct terminations or probationary dismissal. Sources vary on the mid-tier structure - confirm against Labour Code Article 57 before publishing.
Lithuania does not legally mandate a 13th (or 14th) month salary. Discretionary bonuses become binding only once written into a contract or CBA.
P.S. our team speaks multiple languages and we'd love to chat in your preferred language if requested.
Your employee's hours, time off, holidays, bonuses, and commissions are automatically calculated into payroll. RemoFirst will invoice you in either US Dollars (USD), Euros (EUR), British Pounds (GBP), Canadian Dollars (CAD), Australian Dollars (AUD), or Singapore Dollars (SGD) around the 15th of each month to make sure your employees are paid on time. To make it even easier, you can summarize your entire global team's salaries to aggregate them into one payment (instead of many individual payments).
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.
Whenever the employee or employer has a question about, or anything else related to international employment, they can speak with our customer support team to get answers from our team of experts.
