Country Information

Latvia is one of the three Baltic states, along with Estonia, its neighbor to the north, and Lithuania, its neighbor to the south. Latvia is a former Soviet republic which became independent in 1991 when the Soviet Union dissolved. It joined the European Union in 2004 and has used the euro as its currency since 2014. Latvia is a heavily forested and fertile land which produces timber and wood products, as well as high quality agricultural products (particularly grain, dairy products, and honey). Latvia’s location makes it an important transit point between East and West, and the country’s transportation network is well developed. IT and technology are also major industries. The capital, Riga, is home to dozens of tech startups.

Employment Contracts

Employment contracts in Latvia must be in writing and both the employer and employee must receive a copy.

The employment contract must identify:

  • The starting date of the employment relationship and its duration if it is for a fixed time
  • The workplace
  • The employee’s specific occupation
  • Probation period (if any)
  • Salary details
  • Working hours
  • Time required for giving notice of termination of the contract

The provisions of any collective agreement or working procedure regulations that apply to the employment relationship. The employment contract may establish a probationary period if the employee is at least 18 years old. The probationary period may last no longer than three months and must be explicitly stated in the contract. A fixed-term contract may not be longer than five years. If the contract expires but neither party has requested to terminate it, it will effectively be considered an indefinite-term contract.

Working Hours

The standard workweek in Latvia is eight hours per day, over the course of five days. The workweek is capped at 40 hours. In some circumstances, the workweek can be six days, but only after the employer has consulted with the relevant employees’ union. If the workweek is six days, the workday may not be more than seven hours. In general, employees past the age of 18 may work overtime if they have agreed to do so in writing.

Employers may require overtime without employee consent in emergencies or in certain situations where there is an urgent business need. In most cases, an employee who works overtime must be paid at least double the normal hourly or daily rate. Overtime is capped at 48 hours per week. Latvia also has special rules regulating night work, which is any period of work lasting more than two hours performed between 10 p.m. and 6 a.m. People younger than 18, pregnant women and mothers who have given birth in the last year may not work at night. An employee who works at night must be paid at least 50% more than the usual hourly or daily rate.

Sick Leave

In Latvia, the first 10 days of sick leave is paid by the employer. After the first day, which is considered a “waiting day,” the employer must pay at least 75% of the employee’s average earnings for the second and third sick days, and not less than 80% for each of the fourth through tenth days. Beginning on the eleventh day, the employee is eligible to receive a government sickness benefit.

Maternity/Paternity Leave

Female employees receive a total of 112 days of maternity leave. In the event of birth complications or other medical issues either before, during, or after the birth, the mother is entitled to an additional 14 days of supplementary medical leave. A father is entitled to 10 days of leave, which must be used within two months of the child’s birth. When a child under 18 years old is adopted, one of the adoptive parents receives 10 days of leave. A biological or adoptive parent must be allowed to return to their job following parental leave. If that is not possible, the employee must be moved into a similar or equivalent job.

Compensation

Employees are entitled to a monthly minimum wage. Bonuses in Latvia are at the employer’s discretion, but they are common and are typically paid once a year.

Vacation Leave

Employees receive at least four weeks of paid leave annually. Leave is normally granted at a specified time according to a schedule created by the employer after consulting with employee representatives. The employer is obligated to consider the employees’ requests as much as possible. Employees under 18 receive one month of annual leave.

A few categories of employees are entitled to supplemental paid days off in addition to the four weeks of leave:

  • Employees whose jobs involve special dangers or risks are entitled to three additional days
  • Employees who are caring for three or more children under 16 or for a disabled child under 18 at home are entitled to three additional days
  • Employees caring for fewer than three children under the age of 14 receive one additional day
Public Holidays
  • New Year’s Day
  • Good Friday
  • Easter Monday
  • Labor Day
  • Independence Day
  • Midsummer Eve
  • St. John’s Day
  • Proclamation of the Republic Day
  • Christmas Eve
  • Christmas Day
  • Second Day of Christmas
  • New Year’s Eve
Health Insurance Benefits

National healthcare is funded by contributions to National Social Insurance. State-funded healthcare covers emergency medical care, services provided by general practitioners, dentists, lab testing, inpatient care and medications.

Employment / Termination / Severance

If the employment contract establishes a probationary period, either the employer or employee may terminate the contract with three days’ written notice during the probationary period. The employer is not required to provide a reason. An employee who is not in a probationary period may terminate an employment contract with one month’s written notice.

Employers may terminate an employment contract because of serious employee misconduct, such as significant violations of the contract terms, being intoxicated at work, and endangering the health or safety of other employees, among others.

An employer may also terminate an employment contract because:

  • The employee is not competent to perform necessary duties
  • A doctor has certified the employee cannot perform necessary duties
  • The employee does not work because of a temporary incapacity for a period of six months without interruptions
  • An employee who previously held the job is being reinstated
  • The employer is reducing the number of employees
  • The employer is being liquidated

An employer must provide notice of termination and reasons in writing. If the employer wishes to terminate a contract because of an employee’s serious misconduct, the employer must do so within one month of detecting the misconduct. The period of notice that an employer is required to give varies depending on the circumstances of the termination and ranges from no advance notice to one month’s notice. Employers must pay severance when terminating an employment contract for a reason other than employee misconduct. Severance pay ranges from one to four months’ average earnings depending on length of service.

Local Laws & Regulations

We understand that local laws and regulations change and sourcing an accurate reference guide is not easy. Our data is researched and verified by our team of local international Employment Attorneys, HR and Benefit Professionals and Tax Accountants through our Atlas team and consultants, to ensure information up-to-date and accurate.

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Partnering with Atlas when expanding into Latvia, can dramatically reduce the standard brick and mortar processes of doing business in foreign markets and allow you to focus on what you do best, growing your company! To discover more about how Atlas can simplify your ability to expand globally, please feel free to contact us.
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