Guide to employing in Lithuania

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XPANDIUM provides complete PEO, Payroll services and Contractor management solutions for companies wanting to hire employees and run a full payroll without establishing a legal entity in Lithuania.

Your selected candidates will be hired by our own local PEO entity. We take care of the compliant onboarding, payroll, tax payments, benefits of your employees, so you can hit the ground running.


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Xpandium - Hire your employees in Lithuania

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The following information is a basic guideline for employment in Lithuania and the salary calculator can easily help you to understand the basic costs.

Employment Contract

Employment contracts should be written in French.

Probation period

Probation period is optional and maximized at 3 months with a potential and mutual agreement between employer and employee on extending such period with an additional 2 months.

Working hours

In France the maximum working hours are dependent on the type of contract signed; Workers (salarie) or executive (cadre).

For workers, the work week means 35 hours working time. The working day may not exceed 10 hours. Employees may not work more than 4 and a half hours without a break.

The maximized working day may reach 12 hours but prior mutual agreement on terms required between employee and employer.Executive employees earning over a certain salary may work longer hours and can be compensated with additionally given resting days (holiday) rather than OT hours pay. Minimum resting hours between working days must be 11 hours. Minimum resting period in a week must be 35 hours including at least 1 day off every 7 days.

Remote employees

Remote employees receive a home working allowance of EUR 100 per month and to offset having to use part of the employee's home for professional purposes and the intrusion in their private life.

Minimum wage

The current minimum wage is €1,522 per month, or €10.03 per hour.

13th / 14th month salary

Not mandatory.

Payroll Cycle

Salaries are paid on a monthly basis and in general on the last working day of the calendar month.

Employer taxes



Public Holidays




New Years Day

January 1

Day of Restoration

February 16

Day of Restoration of the State of Lithuania

Day of Independence

March 11

Day of Restitution of Independence of Lithuania

Easter Sunday

April 4

Varies yearly

Labor Day

May 1

Father’s Day

June 6

Midsummer’s Day

June 24

Statehood Day

June 06

Assumption of Mary

August 15

All Saints’ Day

November 1

All Souls Day

November 02

Christmas Eve

December 24

Christmas Day

December 25

Saint Stephen’s Day

December 26


Popular benefits in France

You may offer custom benefits for your employees. As an Employer, you may benefit from offering an attractive compensation package during hiring. This means that in addition to salary, employees may receive one or more non-salary compensation.

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Supplementary medical insurances (private or dental / vision)

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Supplementary life insurance

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Additional paid holidays

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Flexible work schedule

Benefit planning process includes

  • Decide on the Annual Benefit Amount - you may offer and divide it by 12 monthly payroll.
  • Select the benefit items you would like to offer employees
  • Internal policy to be prepared, communicated and provided to monthly payroll.
  • Collect the Benefit statements from employees - on the employee selected elements and respective amounts; written and signed, provided to polish EOR payroll.

Offering individual benefits for one or a selected group of employees needs to be planned and advised to be signed with a side agreement along with an employment contract.


Types of Leaves

Paid leave

Employees are entitled to 20 days annual paid leave.

Public holidays

There are 11 paid public holidays. Previous day working hours are shorter with 1 hour fully paid. Timesheets should show 1 less hour for that day.

Sick leave

An employee is entitled to employer paid days yearly.

Payment is 100% of the employee’s average salary for the first 2 days by the employer, but from the 3rd day on the employee receives 62.06% from SODRA without any employer contribution costs.

Pregnancy and maternity leave

Expecting women can have a total of 18 weeks (126 days) maternity leave and receive the average monthly salary of the last 12 consecutive months prior to the birth. Additional 2 weeks leave added for complicated or multiple childbirth. Maternity benefit is a maximum 77.58% of the average wage(as insured’s income) received in 12 consecutive months prior to childbirth, but min. 228 EUR.

Paternal leave

4 weeks

Paternal leave

An employer may grant an employee unpaid leave at the employee’s request.


Employment termination

Employers have the below options to terminate an employment contract in Lithuania:

Termination under probation period

Termination by the Employer is immediately effective.

Resignation by Employee

Employees may freely terminate their employment contract with a written notice of minimum 1 month notice.

Termination by Employer with notice

An employment agreement may be terminated by the Employer by proper notice and cause.

The length of notice depends on the length of the continuous employment period.

  • Standard notice period: 1 month.
  • Employment less than 1-year: 2 weeks notice

Notice periods increase in case of:

  • Employee raising a child under 14 years of age
  • Employee raising a disabled child under age 18
  • Disabled employee
  • Employee within 2 years of retirement pension
  • Notice periods are doubled for employees who will be entitled to the retirement pension in 5 years

Termination of fixed term contract

If termination is due to Employer’s redundancy, the employee is entitled to the salary that they would have received from the date of termination to the expiry date of the contract.

Termination by mutual consent

The termination by mutual consent allows the Employer and Employee to agree freely and in a written agreement with each other on the conditions of termination.

Expiry of employment contract

When the employment contract expires then such employment is automatically terminated.

Severance pay

Employee is entitled to severance pay if the Employer terminates the contract due to redundancy

Employees are entitled to receive 1 month of average wage amounts of redundancy pay if the length of employment with the Employer: 12 months’ or less employment. Redundancy is calculated based on six months’ average wage amounts if the length of employment is over 240 months.