Lithuanian Labour Code Changes from 1 November 2026: What Employers Should Review

As of 1 November, employers and employees in Lithuania have more scope to agree on individual employment terms. The changes affect employment contracts with higher-paid employees, termination at the employer’s will, final payments, remote work and on-call duty at home.

For employers, this means more than updating contract wording. Companies should review how decisions are made and documented, how employee requests are assessed, how statutory deadlines are calculated and how working time is recorded.

Amendments to Article 33 of the Labour Code allow broader individual agreements with employees whose monthly salary is at least twice the latest average monthly gross wage in the national economy published by the State Data Agency.

These employees may agree to depart from certain mandatory rules in the Labour Code or other employment legislation, including rules on the termination of an employment contract. Some requirements remain non-derogable, including maximum working time and minimum rest periods, occupational health and safety, equal treatment and non-discrimination.

The agreement must preserve a balance between the employer’s and employee’s interests. It should clearly identify the guarantee being changed and the tangible benefit the employee receives in return. A signed agreement may not, on its own, demonstrate that the parties’ interests were properly balanced if the arrangement is later challenged.

For the same group of employees, the probationary period may be set at up to six months. If a fixed-term contract is shorter than 12 months, the probationary period must be proportionately shorter. The parties still cannot extend an existing probationary period by mutual agreement.

Article 59 of the Labour Code now expressly requires termination at the employer’s will to be based on a valid reason. The previous restriction preventing employers from relying on reasons listed in Article 57(1) has also been removed.

Employers legally entitled to use this ground must still give three working days’ notice and pay severance of at least six times the employee’s average monthly remuneration.

Before taking this step, an employer should assess whether the stated reason reflects the actual circumstances and whether there is evidence to support it. The employee’s statutory protections and the prohibition of discrimination must also be taken into account. If the decision is challenged, the stated reason will need to match the facts.

The time limits for dismissing an employee for a breach of duties have also changed. Periods when the employee was absent due to temporary incapacity for work or annual leave are excluded from the one-month period for warning an employee about possible dismissal for a second identical breach, and from the one- and six-month periods for deciding whether to dismiss. Employers must still investigate the circumstances, give the employee an opportunity to explain and assess whether dismissal would be proportionate.

Article 146 of the Labour Code allows the parties, at the time of termination, to agree that any amount owed to the employee above one month of the employee’s average monthly remuneration will be paid later, but no later than three months after employment ends.

The portion up to one month of average monthly remuneration must be paid on the final day of employment. The parties may agree at termination to settle within a shorter period of up to ten working days. The agreement should specify the types and amounts of payments and the dates on which they are due. A general clause included in the employment contract at the start of employment does not replace the agreement that must be made at termination.

The rules on late-payment interest during ongoing employment are also changing. Interest is payable for each calendar day of delay, and its rate is linked to the consumer price index multiplied by five. Employers should review their payroll processes as well as their settlement agreement templates.

For employees with statutory protections, an employer’s ability to refuse a request to work remotely or under a preferred working-time arrangement is linked to the specific characteristics of the work organisation or production process. The previous reference to excessive costs of organising remote work has been removed.

This may apply, among others, to employees raising young children, pregnant employees, employees who have recently given birth or are breastfeeding, and employees with certain health or caregiving needs recognised by law.

When assessing a request, the employer should consider the employee’s actual duties: which tasks must be performed at the workplace, how collaboration is organised and why the requested arrangement cannot be reconciled with operational needs. A general company policy requiring everyone to work from the office does not, on its own, explain why a particular request cannot be accommodated.

A collective agreement may provide for different arrangements. It may also set out how additional remote-work expenses are compensated.

Article 118 is relevant to employers whose staff must remain available after working hours to respond to outages, customer requests or other incidents.

Passive on-call duty at home may last up to 168 hours in any four-week period. Employees must receive an additional payment of at least 20% of their hourly pay for each hour of such duty. Time spent actually performing work is paid as working time.

Employers should review how after-hours availability is agreed, how on-call hours are recorded and how pay is calculated. A transitional rule applies to certain agreements on on-call duration made before 1 November; its effect depends on the terms of the particular agreement.

From 1 November, the Labour Code expressly provides that employees retain their pay for the one hour by which a working day is shortened before a public holiday. If an employee’s pay depends on work output, the average wage is paid for that hour.

A higher-level collective agreement may also change certain rules on accumulated annual leave. It may shorten from three years to two the period for using all or part of the leave entitlement. It may also provide for compensation for a portion of accumulated leave defined by law.

These arrangements require a collective agreement at the relevant level; an employer’s unilateral decision or an individual agreement with an employee is not enough. Other changes affect the application of collective agreements, works council guarantees, protection for employee representatives and strike procedures. Employers with employee representatives or applicable collective agreements should review this part of the amendments separately.

Employers should first review employment contract templates, particularly agreements with higher-paid employees and the way probationary periods are set. They should also check termination documents, final-payment procedures, how remote-work requests are handled, on-call records and payroll processes.

Transitional provisions matter too. In some cases, the relevant date is not only when a situation is assessed, but also when a procedure began, a breach occurred or an agreement was made.

The amendments give employers and employees more ways to tailor their working arrangements. For those agreements to work in practice, their terms need to be clear and the employer’s decisions supported by reasons and evidence.

Which employees may be given a probationary period of up to six months?

The longer probationary period may be agreed with employees whose monthly salary is at least twice the latest average monthly gross wage in the national economy published by the State Data Agency. For a fixed-term contract shorter than 12 months, the probationary period must be proportionately shorter.

Can final payment be deferred for more than three months?

No. If the parties agree at termination to defer the portion above one month of the employee’s average monthly remuneration, that portion must be paid within three months after employment ends.

Can an employer reject a remote-work request simply because everyone works from the office?

A request from an employee with statutory protections must be assessed against the employee’s specific duties and the relevant work-organisation or production-process requirements. A general office-based policy does not, by itself, explain why a particular request cannot be accommodated.