Lithuania to Enforce Salary Transparency: New Labor Code Rules Target Gender Pay Gap
The Seimas Committee on Social Affairs and Labour has officially approved a series of amendments to the Lithuanian Labor Code (Darbo kodekso pakeitimai), marking a significant shift toward total salary transparency (atlyginimų skaidrumas). These changes, which transpose the European Union’s Pay Transparency Directive (EU 2023/970) into national law, are designed to dismantle the secrecy surrounding compensation and aggressively address the gender pay gap (vyrų ir moterų atlyginimų skirtumas) across the country.
The legislative package aims to empower employees by granting them a legal right to access information regarding pay levels within their organizations. By mandating clear criteria for salary determination, the government hopes to ensure that equal work—or work of equal value—is compensated fairly, regardless of gender.
New Obligations for Lithuanian Employers
Under the newly approved amendments, employers in Lithuania will face rigorous new reporting requirements. For the first time, organizations will be legally obligated to establish and maintain clear, objective criteria for how salaries are calculated. This move is intended to eliminate arbitrary pay scales and provide a framework for employees to understand their financial standing relative to their peers.
One of the most impactful changes involves the mandatory disclosure of pay ranges. Employers will be required to provide information about the initial pay or its range in job advertisements. Furthermore, the law will prohibit employers from asking prospective candidates about their previous salary history—a practice often cited as a primary driver of persistent pay inequality.
For larger organizations, the stakes are even higher. Companies with a significant workforce will be required to publicly report on the pay gap between their male and female employees. If these reports reveal a pay gap exceeding 5% that cannot be justified by objective, gender-neutral criteria, the employer must conduct a joint pay assessment in cooperation with employee representatives. This proactive measure is designed to force a resolution to systemic inequalities rather than allowing them to persist behind closed doors.
The Drive for Gender Pay Equity
The core of this legislative push is the European Union’s broader strategy to ensure that the principle of equal pay is not just a theoretical right but a practical reality. The gender pay gap in Lithuania has remained a persistent issue, and the Committee believes that transparency is the most effective tool to bridge this divide. By making pay data accessible, the law shifts the burden of proof from the employee to the employer, who must now demonstrate that their pay structures are non-discriminatory.
Beyond just reporting numbers, the amendments require a fundamental rethink of internal corporate structures. Businesses will need to review their job classification systems and ensure that roles are evaluated based on objective skills, effort, responsibility, and working conditions. This systemic overhaul is expected to benefit not only women but all workers who may have been subject to opaque or unfair compensation practices.
Technical Challenges and Implementation Deadlines
While the Committee has signaled its full support for the directive, it also acknowledged the significant technical and administrative hurdles facing the business community. Implementing these changes requires more than just a policy shift; it necessitates the adaptation of technical systems for data collection and reporting.
Currently, several necessary secondary legal acts are still pending, which has delayed the ability of state institutions and private businesses to fully prepare their IT infrastructures. In response to these practical concerns, the Committee has proposed a phased implementation timeline. While the majority of the provisions are set to take effect on June 7, 2026, the specific requirements for reporting data on the state of labor relations have been pushed back to January 1, 2027.
Furthermore, the Committee suggests that employers should have until December 31, 2026, to finalize or update their internal remuneration systems. This additional window is intended to allow the State Social Insurance Fund Board (Sodra) and the State Labor Inspectorate to prepare their own monitoring systems, ensuring a smooth transition to the new regulatory environment. The full Seimas is expected to deliberate on these projects in the coming weeks, with final adoption anticipated shortly thereafter.
Source: ELTA
