Hiring in Lithuania: Employer Costs, Labor Laws and How to Hire
Lithuanian employers pay 1.77% on top of gross pay in 2026, and the employee pays 19.5% from gross pay. On a €3,000 monthly salary, the employer's cost is €36,637.20 a year.
Hiring someone in Lithuania? This guide covers what an employee costs, Sodra contributions, the labor rules that apply, income tax, work visas and the ways a company outside Lithuania can employ someone there.
Employer and employee contributions in Lithuania, 2026
Key employment rules in Lithuania
How to hire in Lithuania
Hiring in Lithuania comes down to two decisions: who you hire, and how you employ them.
- Find the person. Write the role, set the salary against Lithuanian pay levels, then source and interview candidates. You can run the search yourself with a job post, or use a placement service that delivers a shortlist.
- Choose how to employ them. A Lithuanian entity running payroll, an employer of record or a contractor agreement. Each option is explained below.
- Make the offer. The contract has to meet the rules in the employment table above. Pay in Lithuania is usually quoted as a gross monthly salary in euros.
Your options for employing someone in Lithuania
- Lithuanian entity: you register a company in Lithuania, run payroll, withhold the employee's contributions and income tax, and pay the employer's contributions to Sodra yourself. It suits a team of several people in Lithuania.
- Employer of record (EOR): a third-party provider becomes the legal employer and runs Lithuanian payroll for a monthly fee per employee. Your company directs the work.
- Contractor: the person invoices you as a self-employed worker. The relationship has to be genuinely independent, or it can count as employment.
Euro Remote Talent does not employ people on your behalf. We handle the placement: we find and shortlist the candidate, and you employ them through the route that fits.
What an employee costs in Lithuania
Take a salary of €3,000 gross a month in 2026, which is €36,000 a year, on an open-ended contract in accident group I.
- Employer contributions: €36,000 x 1.77% = €637.20
The employer's cost is €36,637.20 a year. Lithuania puts most social insurance on the employee: the employer adds only 1.77% on top of gross pay, or 2.49% on a fixed-term contract. The employee pays 19.5% for pension, sickness, maternity and health insurance, or €7,020, plus income tax. The employer withholds both from gross pay.
Minimum wage and pay
The minimum monthly wage is €1,153 gross in 2026, and the minimum hourly pay €7.05. It may only be paid for unskilled work. On 1 July 2026 the Government approved €1,245 a month and €7.61 an hour for 2027, €92 or 8% more. For 2026, Sodra applies an average national wage (VDU) of €2,312.15 a month to calculate the social insurance contribution base. See our Lithuania minimum wage page.
Income tax in Lithuania
The employer withholds personal income tax from each salary payment. Since 1 January 2026, employment income is taxed in 3 bands set in multiples of the average national wage (VDU), which Sodra applies at €2,312.15 for 2026:
| Annual employment income, 2026 | Rate |
|---|---|
| Up to 36 VDU (€83,237.40) | 20% |
| Above 36 VDU up to 60 VDU (€83,237.40 to €138,729) | 25% |
| Above 60 VDU (€138,729) | 32% |
A tax-exempt amount (NPD) lowers the tax on lower salaries. It shrinks as pay rises.
Public holidays
Lithuania has 16 public holidays a year under Labor Code article 123. In 2027, 9 fall on a weekday. See every date on our Lithuania public holidays 2027 page.
Work visas
- EU Blue Card: a temporary residence permit for highly qualified work. Pay must be at least 1.5 times the average gross monthly wage of the last calendar year, or 1.2 times for jobs on the official shortage list, with a contract of at least 6 months. It is valid for 3 years and the fee is €160.
- EU citizens: people from EU countries need no work permit.
How Euro Remote Talent can help
We do placement. We source, screen and interview remote professionals across Europe, then deliver a shortlist of 3 candidates within 21 days for a flat $6,500, or your deposit back. Prefer to run the search yourself? Post a job for $299 and reach candidates who want to work remotely.
See how placement works, post a job or book a 30-minute call. Browse remote jobs in Lithuania to see who is hiring there now.
This is general information, not legal or tax advice. Rules change and collective agreements can set different terms. Confirm with a local accountant or lawyer before you hire.
Frequently asked questions
How much does an employer pay in contributions in Lithuania?
1.77% of gross pay in 2026 on an open-ended contract in accident group I, on top of salary. The employee pays 19.5%, which the employer withholds from gross pay.
What does a €3,000 monthly salary cost a Lithuanian employer?
€36,000 a year plus €637.20 in employer contributions, for €36,637.20 in total.
How long is the notice period in Lithuania?
1 month when the employer dismisses an employee without fault, or 2 weeks if employment lasted under 1 year, under Labor Code article 57. Some groups get double or triple notice.
How much paid leave do employees get in Lithuania?
At least 20 working days a year on a 5-day week, plus 16 public holidays.
Can a company outside Lithuania hire someone there without a local entity?
Yes. The usual routes are an employer of record, a third-party provider that employs the person for you, or a genuine contractor agreement. Euro Remote Talent handles the placement: we find, screen and shortlist the person, and you choose the route.
Sources
- Sodra, Contribution rates from 1 January 2026. Checked 3 Nov 2026.
- VMI, Taxation of residents' income from 1 January 2026. Checked 3 Nov 2026.
- TAR (e-tar.lt), Labor Code, consolidated version from 1 November 2026. Checked 3 Nov 2026.
- SADM, Labor Code changes from November 2026. Checked 3 Nov 2026.
- SADM, Pay and minimum wage. Checked 3 Nov 2026.
- SADM, Minimum wage for 2027 approved, 1 July 2026. Checked 3 Nov 2026.
- European Commission, EU Blue Card in Lithuania. Checked 3 Nov 2026.
