Edgars Rinkis

PwC Legal lawyer

The Latvian Labour Code is amended on a regular basis and sometimes even more than once a year, but recent years have not seen so sweeping amendments as those coming into force on 1 August 2022. This article will help you navigate the new provisions of labour law.

Why is it amended?

Latvia has to adopt the requirements of EU directives 2019/1152 and 2019/1158 by August 2022. The directives address matters around providing predictable working conditions and balancing the work-life aspects of parents and carers. Since the amendments to the Labour Code are based on the directives, we are focusing on these aspects.

What will change?

The amendments can be viewed here, but not all of the amended provisions have an equally important effect on employment processes, so we are looking only at key aspects in detail.

One of the amendments is concerned with the terms and conditions of a collective agreement. To encourage the use of collective agreements (in fact following the example set by certain Northern European countries where entering into collective agreements is standard practice), a collective agreement will provide for an opportunity to derogate from certain statutory minimum requirements as long as this doesn’t reduce the overall level of worker protection. This will allow the parties to agree on more balanced solutions even if a certain aspect of such agreement doesn’t meet the minimum statutory requirements. This arrangement was so far permissible only in special cases defined by the Labour Code. The new procedure will be applicable on a wider scale, for instance, workers may in future be assigned a longer period of probation (up to six months) in their collective agreement.

Another key amendment relates to the content of an employment contract and resolves a number of practical issues routinely facing employers and human capital managers:

1. In line with the latest working trends (remote and online) the employment contract will no longer have to specify a place of work, as the new rules permit the contract to state that the worker is free to determine their place of work.
2. The employment contract will have to state monthly minimum guaranteed working hours for part-time workers for whom there is no way to predict this, as well as stating the minimum period of notice before the start of work.

This is particularly important because employers were so far not required to determine guaranteed working hours or a minimum notice period. The new rules also provide for legal consequences: the employer will have to pay for at least the minimum working hours, and if the employer ignores the notice period, the worker will have the right to refuse to carry out their job duties. Also, if the employer fails to duly notify cancellation of work, the worker will remain entitled to the agreed pay for doing that work.

3. The employment contract will have to state additional information that was so far not required:

• A period of probation and its length
• The worker’s right to training
• A reference to social security agencies receiving social contributions (and any extra social security provided by the employer)

This information may be replaced with a reference to the law or to the company’s employment manual.

Several more amendments will be made:

What do we do now?

Since the amendments are huge, it would be necessary to carefully review the documentation of your working processes and procedures. Special attention should be paid to the terms of your employment contracts to ensure any concluded in August fully comply with the statutory requirements. It’s important to note that if employment begins before August, then either the employment contract has to be amended or the workers need to be made aware of the information mentioned in sections 40 and 53 of the amendments.