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Notice period in Lithuania

Employment termination in Lithuania

Post-termination restraints in Lithuania

Waivers in Lithuania

Transfer of undertaking in Lithuania

Mitigate risk with CXC’s end-to-end solutions

End of employment in Lithuania

The end of employment in Lithuania is governed by clear legal procedures designed to balance the rights of both employers and employees. Whether an employee is on a fixed-term contract, permanent role, or undergoing a probationary period, the Labour Code sets out requirements for lawful dismissal. Standard notice periods apply depending on length of service, with 30 days’ notice typically required after one year of employment. Employees nearing retirement age, or those with dependents, may also be entitled to extended notice periods.

Ending employment in probation period in Lithuania is more flexible. During the probationary phase (commonly up to three months) either party can terminate the contract with just three calendar days’ written notice, without needing to provide a specific reason. However, employers should still ensure the decision is fair and documented in writing, as employees retain the right to challenge dismissals they believe are discriminatory or unjust.

Severance pay is also regulated by tenure, with employees entitled to up to six months’ average salary depending on their years of service. In cases involving mergers or company restructuring, termination and rehire may occur through a two-step process, with sellers and buyers managing obligations like severance and re-employment offers.

By aligning employment termination procedures with legal requirements, Lithuanian employers can minimise disputes and protect their reputation. Working with a compliant Employer of Record like CXC can help navigate local laws while handling all documentation and processes accurately.

Notice period in Lithuania

Lithuania’s notice period for employees

The standard notice period in Lithuania is 30 calendar days for employees with at least one year of service. For those employed for less than a year, the minimum notice requirement is 14 calendar days. Lithuanian labour law also outlines extended notice periods for certain protected groups. Employees with less than five years remaining until the statutory pension age are entitled to a doubled notice period. The same extension applies to employees raising a child under the age of 14, a disabled child under the age of 18, or those within two years of retirement eligibility.

Notice must always be provided in writing, clearly stating the grounds for termination, unless both parties agree to terminate the employment by mutual consent. Mutual terminations must also be documented in writing and require agreement on the final date of employment.

Probation period in Lithuania

While not mandatory, a probationary period is a common practice in Lithuanian employment contracts. Typically, the probation period lasts up to three months, giving both employer and employee time to evaluate the suitability of the employment relationship. During this period, a shorter notice period of three calendar days applies for dismissal unless otherwise specified in the employment contract. Probation must be clearly stated in the contract at the time of hiring.

Severance pay in Lithuania

Severance pay is determined based on the employee’s length of service. Employees who have worked for up to one year are entitled to severance equivalent to half of their average monthly salary. Employees with more than one year but fewer than 20 years of service are entitled to two months’ average salary. For those with 20 or more years of service, the severance rises to six months’ average pay. These entitlements apply when termination is initiated by the employer on valid, non-disciplinary grounds.

Employment termination in Lithuania

Ending an employment relationship requires careful consideration and strict adherence to legal requirements. In Lithuania, termination rules are well-defined under the Labour Code, providing both employers and employees with clarity on their rights and responsibilities.

Definition of termination of employment in Lithuania

To define termination of employment in Lithuania, it refers to the formal ending of an employment contract between the employer and employee. Termination can occur by mutual agreement, at the initiative of either party, or due to external circumstances such as company closure or the employee’s death. In all cases, the notice of termination must be submitted in writing, stating the reason, legal basis, and termination date.

Reasons for termination of employment in Lithuania

There are multiple reasons for termination of employment in Lithuania, broadly grouped into the following categories:

Termination for cause (disciplinary or misconduct):

Serious misconduct such as theft, fraud, or workplace violence.
Wilful disobedience of lawful instructions.
Gross neglect of duty or persistent underperformance despite prior disciplinary measures.
Breach of trust, especially in roles requiring fiduciary responsibility.
Violation of employment duties, particularly if prior sanctions have been issued within the past year.

Termination for economic reasons:

Redundancy due to restructuring or changes in business operations.
Company liquidation or other forms of business closure.
Poor financial condition impacting the ability to retain staff.

Termination due to incapacity or health:

If an employee is medically unfit for their role and refuses or cannot be reassigned.

Other legal grounds:

A court decision or legal disqualification.
Loss of professional license or similar rights.
Employee’s or employer’s death, where the contract is not transferable.
Request by a parent/guardian for minors under 16.

Best practices when terminating employment in Lithuania

Best practices when terminating employment in Lithuania emphasise professionalism and transparency throughout the process.

Employers should provide written notice that clearly outlines the legal basis for termination. In cases involving alleged misconduct, it is important to ensure due process is followed, allowing the employee an opportunity to respond. When underperformance is the issue, a performance improvement plan should be implemented before moving forward with dismissal.

Employers must also respect special protections granted to certain categories of employees, such as pregnant individuals or those currently on leave. Where applicable, severance pay should be provided in accordance with the employee’s tenure and the reason for termination.

Post-termination restraints in Lithuania

Non-competes in Lithuania

Post-termination restraints in Lithuania are legally permitted under specific conditions, primarily to protect an employer’s legitimate business interests. Non-compete clauses are one of the most commonly used restraints and are enforceable provided they meet criteria of necessity and proportionality. Typically, non-competes in Lithuania are used to safeguard confidential information, protect client relationships, or limit unfair competition after an employee exits a role.

There is no strict statutory limit on the duration of non-compete clauses, though in practice, periods between 6 months and 1 year are most common. The Lithuanian Labour Code permits a maximum enforceable duration of up to two years. The scope must be narrowly tailored in terms of geographical area and business activities restricted. If deemed overly broad, the clause may be considered unenforceable by the courts.

Employees subject to non-compete restraints must receive compensation. This is typically no less than 40% of their average monthly salary for the duration of the restriction. The clause must be agreed upon in writing, either within the employment contract or a separate agreement. Notably, if employer breaches notice requirements or terminates an employee improperly, the right to enforce a non-compete may be lost.

Employee non-solicits in Lithuania

Employee non-solicits in Lithuania aim to prevent former employees from poaching current staff after leaving a business. These clauses are generally permitted, but their enforceability will depend on context. Courts may assess whether the clause disproportionately limits an individual’s right to work freely, especially considering the constitutional right to employment mobility.

To remain valid, such clauses must be proportionate, necessary for the protection of the employer’s legitimate business interests, and clearly worded. A time limit of 6 to 12 months is typically considered acceptable.

Customer non-solicits in Lithuania

Customer non-solicit clauses are also commonly used to restrict former employees from approaching or doing business with the employer’s clients. These restrictions are enforceable in Lithuania if they meet the test of reasonableness and necessity. Similar to non-competes, the clause must be specific in its scope, and any ambiguity may render it unenforceable.

In all post-termination restraints in Lithuania, employers should evaluate whether the restriction is necessary, narrowly tailored, and supported by compensation where applicable. Consulting local legal counsel can help ensure that restrictions are enforceable and do not violate employee rights under Lithuanian labour law.

Waivers in Lithuania

Types of employment waivers in Lithuania

While not formally classified as “”waivers,”” Lithuanian employment law does recognise specific exemptions and agreements that resemble waiver-like arrangements. These must always align with the Labour Code and general principles of employee protection. Notably, any clause or agreement where an employee waives their right to contest unfair dismissal or termination is considered void. This ensures employees maintain the right to challenge unlawful employment practices, even if they have signed documentation to the contrary.

In practice, employment waivers may manifest through contract types or agreements on work conditions. Common contract types include indefinite-term, fixed-term, and apprenticeship contracts. Fixed-term contracts, for instance, might limit certain rights linked to indefinite contracts, but these are regulated strictly to prevent abuse.

Employees may also be granted exemptions in specific contexts, such as unpaid leave or reduced working hours. For example, workers raising young children or those with disabilities can request modified schedules. These adjustments must be agreed upon mutually and cannot compromise the core rights of the employee.

Residency waiver in Lithuania

A residency waiver in Lithuania typically refers to exemptions from standard residence permit requirements. These waivers may apply to individuals with Lithuanian heritage, spouses of Lithuanian citizens, or highly qualified professionals. For instance, under the Law on the Legal Status of Foreigners, certain professionals can obtain temporary residence permits without meeting standard qualification thresholds if their employment is deemed strategically valuable.

The waiver process usually involves a case-by-case assessment by the Migration Department. Applicants may need to show proof of employment, education, or family ties. These residency waivers support Lithuania’s broader goal of attracting skilled professionals while preserving family unity for returning diaspora members.

Visa waiver programme in Lithuania

Lithuania participates in the Schengen Area, meaning short-term visa requirements are harmonised with other Schengen states. Citizens from many countries, including the United States, Canada, Australia, and Japan, benefit from a visa waiver programme with Lithuania, allowing them to enter the country for up to 90 days within a 180-day period without a visa for tourism, business, or family visits.

However, visa-free travel does not grant work authorisation. Employers should ensure that foreign hires outside the EU have appropriate residence or work permits even if they qualify under the visa waiver regime. Violations can result in penalties for both employer and employee.

Ultimately, while waivers in Lithuania exist across employment, residency, and border policies, they remain subject to legal constraints that favour fairness, transparency, and the safeguarding of rights. Employers should consult legal counsel or a professional employment partner to navigate the evolving landscape of Lithuanian labour and immigration law.

Transfer of undertaking in Lithuania

When businesses in Lithuania undergo mergers, acquisitions, or sales, the transfer of undertaking can have significant implications for employers and employees alike. Unlike many other EU jurisdictions, Lithuania does not automatically transfer employees from one business to another during such transactions. Instead, the process is structured to ensure both legal clarity and operational flexibility for the organisations involved.

Transfer of employment in Lithuania

The transfer of employment in Lithuania typically follows a two-step process. First, the original employer (usually the seller in a transaction) must terminate the employee’s contract. Then, the acquiring business (the buyer) must offer new employment to those individuals.

This model differs from automatic transfer systems used in other European countries, where employees’ contracts are seamlessly carried over. In Lithuania, for the transition to be legally compliant, the buyer must offer employment under terms and conditions that are not less favourable than those previously held. If these conditions are met, the seller is not obligated to pay statutory severance pay. This exception is critical for employers to understand, as it may significantly reduce the costs associated with organisational restructuring or asset sales.

Employees who unreasonably refuse an offer that meets the conditions are not entitled to severance payments either. This clause provides a degree of balance, ensuring employees are protected from adverse changes while allowing employers to manage transitions pragmatically.

Best practices during transfer of undertaking in Lithuania

To ensure smooth and compliant transfers, employers should:

Communicate early and transparently with employees to minimise disruption and maintain morale.
Document employment offers clearly to show they meet or exceed previous employment terms.
Consult legal counsel to ensure employment law compliance and avoid liability.
Coordinate with HR departments to manage records, benefits, and any necessary onboarding.
Assess severance obligations carefully in cases where new offers are not made or are declined.

During transfer of undertaking in Lithuania, Employers should also review the country’s Labour Code and applicable EU directives on business transfers to align their internal policies. The key goal is to respect employee rights while supporting business continuity. The Lithuanian model offers flexibility but demands attention to process and documentation to avoid costly disputes.

Mitigate risk with CXC’s end-to-end solutions

The end of employment in Lithuania is governed by structured legal processes, with standard notice periods, severance entitlements, and protections for certain employee groups. Ending employment during probation can be more flexible, allowing termination with just three days’ notice, though fairness and documentation remain important.

Whether handling routine dismissals or complex transitions like business transfers, employers must follow local rules carefully. Partnering with an Employer of Record like CXC helps ensure compliance, especially when managing contracts, notices, and severance correctly.

Talk to our team of employment experts today.

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