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If you’re considering hiring in Latvia, you should know a few things. It’s vital first to know your audience and the Latvian market well. The second step is to incorporate a company in Latvia or work with an Employer of Record (EOR).
Thirdly, you’ll need to secure all obligatory licenses and permits to run your enterprise legally. All employees in Latvia are guaranteed by law to receive a minimum wage, to work in a safe environment, and to be free from discrimination.
Latvia is a European Union member, which has implications for businesses looking to hire in the country. Several rules and regulations need to be followed when it comes to hiring EU citizens.
There are several reasons Latvia is a great place to look for remote workers. Firstly, a highly educated labour force is one advantage the country possesses. In fact, more than half of the people in the country have some level of higher education.
That’s great news for businesses looking for remote workers, as it means they have their pick of many competent individuals. Latvia’s infrastructure is another positive factor in the country’s favour as a remote worker destination.
The infrastructure in Latvia is relatively advanced and includes advanced methods of communication and access to fast and reliable online data. Finally, Latvia’s convenient location makes it a top destination for employers seeking remote workers.
Native Teams’ Employer of Record services help you hire and pay your team through an owned infrastructure in Latvia. We handle everything from legal employment to ensuring your team is paid and managed compliantly and with care, without any third parties involved.
Hire your first Latvian employee with Native Teams.
Considering the importance of comprehending and adhering to Latvia’s hiring laws, we’re exploring the most significant ones applicable to both employers and employees.
Latvia’s employment law framework is primarily governed by the Labour Law (Darba likums), which regulates key aspects of employment, including employment contracts, working hours, wages, benefits and termination.
The legislation establishes rules governing employment relationships, workplace health and safety, and redundancy procedures.
Collective bargaining agreements also play an important role in regulating employment conditions. They may establish terms and conditions that go beyond the minimum requirements set out in national legislation.
Latvia recognises two main types of employment contracts: indefinite-term (open-ended) contracts and fixed-term contracts. Both types can be arranged on a full-time or part-time basis.
An indefinite-term employment contract does not specify a fixed period of employment. If a contract does not state a time limit, or if the circumstances do not permit the duration of employment to be limited, the contract is treated as indefinite.
This type of contract establishes an ongoing employment relationship without a predetermined end date, providing the employee with long-term employment security.
An employment contract must include the following information:
Download a free employment contract for Latvia through Native Teams.
An employment contract must be concluded in writing to ensure that both parties have a clear, formal record of the agreed terms and conditions of employment.
However, the absence of a written contract does not invalidate the employment relationship or mean that it does not exist. If the requirement for a written contract has not been met, the employee retains the right to request that the terms of the employment contract be set out in writing.
Full-time working hours in Latvia must not exceed eight hours per day and 40 hours per week. Where a six-day working week is specified, daily working hours must not exceed seven hours.
If the employment contract does not specify working hours, full-time working hours are presumed to be 40 hours per week.
Part-time working hours are any hours that are shorter than the applicable full-time working hours.
An employee may not work for more than one employer if their combined working hours exceed eight hours per day.
Night work is defined as work performed for more than two hours during the night-time period. For adults, night-time runs from 10 pm to 6 am. For children, it runs from 8 pm to 6 am, as specified by law.
A night-shift employee is someone who regularly works at night according to a shift schedule or works at night for at least 50 days in a calendar year.
For night-shift employees, the normal daily working time is reduced by one hour, unless the employee already has reduced working hours. This reduction does not apply where the nature of the work requires otherwise.
However, employees working night shifts in jobs involving special risks must not work more than eight hours in any 24-hour period. Exceptions may apply following consultation with employee representatives.
Employees who work at least six hours per day are entitled to a break of at least 30 minutes on each working day, unless a special law provides otherwise. The break must be granted no later than four hours after the start of work.
Employees are entitled to at least 12 consecutive hours of rest within every 24 hours. They also must receive at least 42 consecutive hours of rest within every seven days.
The number of weekly rest days depends on the working week specified:
Employees in Latvia are entitled to at least four weeks of annual leave for each calendar year. A collective agreement, an agreement between the works council and the employer, labour regulations or the employment contract may provide for a longer annual leave entitlement.
Employees who are entering employment for the first time, or who have had a break of more than eight days between two employment relationships, become entitled to the full annual leave entitlement after six months of continuous employment with the same employer.
Employees who have not yet met the conditions for full annual leave are entitled to a proportional amount, calculated as one-twelfth of the annual leave entitlement for each month of employment.
Annual leave may be taken in separate periods during the current year if the employee and employer agree. However, at least one period of annual leave must consist of two uninterrupted calendar weeks.
Latvia’s minimum wage is governed by various legislative acts, primarily Article 61 of the Labour Law, and is set by the Cabinet of Ministers. Employers are legally prohibited from paying employees less than the applicable statutory minimum wage.
To calculate the salary and taxes in Latvia, click here.
Sickness benefits in Latvia are granted on the basis of an electronic work incapacity certificate issued by a doctor.
The average contribution wage used to calculate sickness benefits is based on the 12 months ending two months before the onset of the illness. For self-employed persons, the reference period ends three months before the onset of the illness.
Sickness payments are divided between the employer and the State Social Insurance Agency as follows:
To qualify for sickness benefits, employees must have paid social insurance contributions for at least three months within the six months preceding the month in which the insured event occurred, or for at least six months within the 24 months preceding that month.
If the employment relationship ends while the employee remains medically certified as unable to work, sickness benefits continue to be paid for 30 calendar days following the end of the employment relationship, provided the period of work incapacity continues.
Every employee has an individual right to parental leave of up to one and a half years in connection with the birth or adoption of a child. This leave may be taken at any time until the child reaches the age of eight.
Parental leave may be taken as one continuous period or divided into separate periods. Employees are also protected by two additional guarantees: time spent on parental leave counts towards their total length of service, and they retain the right to return to their previous job.
Women are entitled to 56 days of leave before childbirth and 56 days of maternity leave after childbirth.
The father of a child is entitled to 10 working days of paternity leave. This leave should be granted immediately after the child’s birth and must be taken no later than six months after the birth.
If the mother dies during childbirth, is unable to care for the child within the first 42 days after birth, or has legally refused to care for and raise the child within that period, the father is entitled to leave until the child reaches 70 days of age.
The entitlement to 10 days of paternity leave also applies to one of the two adoptive parents of a child under the age of three.
During paternity leave, the employee is entitled to financial compensation equal to 80% of the salary.
Employment in Latvia may be terminated in the following ways:
An employer may ordinarily terminate an employment contract if there is a valid legal reason for doing so. Latvian law recognises eight grounds for ordinary termination:
These time limits exclude periods of prenatal and maternity leave, as well as periods of incapacity caused by an accident at work related to exposure to environmental factors or by an occupational disease.
In exceptional circumstances, an employer may also apply to a court to terminate an employment relationship on grounds not listed above, provided there is good cause.
Any dismissal must be in writing and delivered to the employee. Where the employer explains the dismissal, it must be included in the written notice.
Notice periods in Latvia depend on the grounds for termination and who initiates the termination.
For ordinary dismissal by the employer, the minimum notice periods are as follows:
Other termination scenarios have the following notice requirements:
Employees are eligible for benefits if they have been employed for a continuous period of at least one year and social insurance contributions have been paid for at least 12 months within the preceding 16-month period.
Severance pay is generally granted when the employer terminates the employment contract, except where the termination is based on the employee’s conduct. This distinction means that entitlement to severance pay depends on the reason for termination.
Employees may not, without their employer’s approval, conduct business on their own behalf or on behalf of another person if that business relates to the activities performed by the employer. This is known as the legal prohibition of competition.
If an employee breaches this prohibition, the employer may seek compensation for the damage suffered or require that the work be treated as having been performed on the employer’s behalf. In the latter case, the employee must hand over the earnings from the work to the employer or transfer the corresponding claim to those earnings.
If the employer knew, when the employment relationship began, that the employee was engaged in certain activities and did not require the employee to stop, the employer is considered to have permitted those activities to continue.
The legal prohibition of competition applies even if it is not expressly included in the employment contract.
An employer and employee may agree to restrict the employee’s competitive activities for a specified period after the employment contract ends. Under such an agreement, the employee may be prohibited from:
A contractual prohibition of competition must be agreed in writing. It may form part of the employment contract, but it cannot extend beyond two years from the date the employment relationship ends.
A non-compete agreement will not apply to the extent that it constitutes an unfair restriction on the employee’s future professional activities. This assessment takes into account the nature, scope, geographical area and duration of the restriction, as well as the compensation payable to the employee.
The maximum probationary period in Latvia is three months. However, where a collective agreement with an employee trade union is in place, the probationary period may be extended to a maximum of six months, provided that a specific agreement is concluded to allow for the longer period.
If a previous employment contract included a probationary period, neither the employer nor the employee may agree to a new probationary period in a subsequent contract covering the same tasks.
During the probationary period, either party may terminate the employment contract by giving three days’ written notice before the termination takes effect.
As a general rule, intellectual property created by an employee during their employment and related to their job responsibilities belongs to the employer.
The specific arrangements may vary depending on the circumstances. Employment contracts should therefore include clear provisions on IP ownership, particularly for roles involving creative work, innovation or research and development.
Employers must have a lawful basis for processing employees’ personal data. This may include fulfilling contractual obligations or complying with legal requirements.
Consent may also serve as a lawful basis, but it must be freely given, specific, informed and unambiguous. Employers should avoid relying solely on consent for processing personal data in an employment context.
Employers must also follow the principle of data minimisation, collecting and processing only the personal data necessary for the intended purpose.
Employees must be informed about the personal data collected, the purposes for which it is processed, and their rights concerning their data. This information should be provided through a privacy notice.
In Latvia, employees may work from home at a separate workplace on a permanent, temporary, or occasional basis, provided the employee and employer agree to the arrangement after a proposal from either party. The nature of the work must allow it, and the work must meet the applicable low-risk requirements under occupational safety regulations.
An employee who normally works at the employer’s premises may propose an amendment to their employment contract to introduce working from home for a specified period. This arrangement may be requested to help the employee balance work, family responsibilities and personal needs.
In extraordinary circumstances, such as disease epidemics, earthquakes, floods or similar events, the employer may arrange for employees to work from home to maintain business operations and protect the health and safety of employees and others. In these circumstances, the employer may introduce working from home without amending the employment contract.
When an employee requests an amendment to their employment contract to introduce or modify working-from-home arrangements, the employer must provide a formal response within a reasonable timeframe. The response must address the proposed changes, taking into account the nature of the request and its potential impact on the employee’s role and the organisation.
The employer may refuse the request only where there is a legitimate and justified reason for doing so. Possible grounds include operational difficulties, security concerns or the nature of the employee’s duties, which may not be suitable for remote work. The reasons for refusal must be clear, reasonable and communicated to the employee.
Employers must assess risks associated with the employee’s home working environment, including ergonomics, workspace setup and potential hazards. They must also provide the necessary work equipment that meets applicable safety standards and inform employees about safe working practices.
The home workspace should be arranged to minimise health and safety risks. This includes ensuring proper lighting, adequate ventilation and a comfortable working position to help prevent musculoskeletal problems.
Employers must also consider psychosocial risks, such as isolation and stress. Providing appropriate support and maintaining regular communication with employees helps address these risks and prevent overwork.
Hiring employees from Latvia offers a unique mix of advantages and opportunities, especially for companies that look for cost-effectiveness with high-quality work.
First of all, Latvia has a strong education system with a wide focus on technology, engineering, and language skills. Many Latvians are fluent in multiple languages, including English, German, and Russian, which can be an asset for companies needing multilingual support.
Latvia is also a hub for tech talent, with a growing pool of developers and IT professionals. Many Latvian workers are experienced in programming, software development, and digital services, which makes them valuable for international tech companies.
Lastly, the Latvian work culture blends Eastern and Western European values, resulting in strong work ethics, reliability, and adaptability. Latvian employees are known for their professionalism, dedication, and proactive problem-solving approach, which can align well with companies seeking committed and adaptable team members.
Native Teams helps you employ and pay your team in Latvia directly through owned entities and infrastructure.
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