Employee working from abroad: change the contract? Which law applies?

If an employee of a Lithuanian company is going to work permanently from another country, you need a written agreement – an amendment to the employment contract or an agreement on remote work – and an updated notice of working conditions. The employer can transfer an employee to work in another locality on its own initiative only with the employee’s written consent. The parties may choose which country’s labour law applies. But that choice does not take away the protection the employee has under the mandatory rules of the country where they usually work permanently. For employees posted to Lithuania by a foreign employer, the core Lithuanian working conditions apply whatever law governs the contract, subject to the exceptions in Article 108 DK. Social insurance and tax are a separate question that labour law does not settle.

What requirements apply to remote work and what happens to employment when a business is transferred we have already answered in the FAQ on labour law consultations. Here is what changes when a national border separates the employee from the employer.

Temporary or permanent: this decides everything

The first question is always the same: will the employee work abroad temporarily, or will that be their permanent place of work?

Temporary work elsewhere is a business trip (komandiruotė). Article 107(1) of the Labour Code of the Republic of Lithuania (DK) defines it as performing one’s work duties in a place other than the permanent place of work. For an employee sent abroad temporarily, Lithuanian labour law applies to the extent it is not governed by the mandatory provisions of the host country (Article 9(1) DK).

If a posting to another country lasts longer than twenty-eight days, before departure the employee is given the information on working conditions with additional details. Article 107(6) DK lists them: the country and the length of the posting, the currency in which pay will be made, any payments for work in the other country and the conditions of return, where these apply.

Permanent work from another country is not a business trip, but a change in working conditions.

When the place of work moves to another country

Article 45(1) DK allows the employer, on its own initiative, to transfer an employee to work in another locality only with the employee’s written consent. Quite often it is the employee who wants to move. Then, once the employer agrees, the working conditions are deemed changed when the corresponding amendment to the employment contract is made (Article 46(4) DK). Amendments are made in writing (Article 43(2) DK).

The new place must also be entered in the notice of working conditions. Article 44(1)(2) DK requires the place where the job function is performed to be stated. The employee is informed of changed conditions before they take effect (Article 44(4) DK).

If the employee will work from home abroad, this is remote work. Article 52(1) DK defines it as work in an agreed place other than the workplace. The same requirements apply as those we described in the FAQ. From 1 November 2026 two rules in Article 52 DK change. Today the employer may refuse certain employees’ requests to work remotely only if it proves excessive costs; from that date it may refuse where the features of its work organisation or production process do not allow it, unless a collective agreement provides otherwise (Article 52(2) DK, version from 2026-11-01). The duty to compensate additional remote-work expenses remains, unless a collective agreement provides otherwise (Article 52(4) DK, version from 2026-11-01). Abroad, the rules of that country are added to these requirements – see the next section.

In one case, a client asked whether the contract could state a place of work abroad even though much of the work was actually done in Lithuania, because that would be simpler for tax. Our answer: the contract and the notice of working conditions must reflect reality. The tax consequences for the employee and the company must be assessed separately with a tax adviser, before the contract is changed.

Which law applies

The rule is set by Article 12 DK. Where the employment relationship is connected with more than one country, the parties may choose the applicable law – for the whole relationship or for separate aspects of it (Article 12(1) DK). If they have not chosen, the law of the country where the work is permanently performed applies (Article 12(2) DK). If the employee does not permanently work in one country, the law of the country where the employer or its workplace is located applies. These rules do not apply where the employment relationship is more closely connected with another country (Article 12(3) DK).

Paragraph 4 matters most. The chosen law does not override the mandatory rules of the country whose law would have applied had the parties not chosen (Article 12(4) DK). Article 8(1) of Regulation (EC) No 593/2008 (Rome I) sets the same rule at EU level: the choice of law may not deprive the employee of the protection afforded by provisions that cannot be derogated from by agreement. Article 8(2) Rome I adds that the country where the work is habitually carried out does not change if the employee is temporarily employed in another country.

What this means in practice. If an employee works permanently from another country, the contract can keep Lithuanian law. But that country’s mandatory rules may still apply to the employee. Which ones they are must be checked under that country’s law.

Hiring someone who lives abroad

Clients often ask whether the contract can state a home address abroad. Our answer: it makes no difference which address is stated. There is no need to write migration provisions into the employment contract itself.

The notice to the State Social Insurance Fund administration (Valstybinio socialinio draudimo fondo administravimo įstaiga, known as Sodra) has one exception worth knowing. Article 42(2) DK does not apply the duty to notify before work starts where the contract states that the place of work is outside Lithuania and where, under the EU regulations on the coordination of social security systems or international treaties, legislation other than Lithuania’s applies to the person in the field of social insurance. Which country’s social insurance law applies to a particular employee must be checked separately. That is not decided by labour law.

If the employee is a third-country national and will come to work in Lithuania, they will need migration documents. We described them in the article on the temporary residence permit.

A foreign employer’s staff posted to Lithuania

Article 108(1) DK provides for three cases in which an employee of a foreign employer is posted to work temporarily in Lithuania:

• under a contract for services or works with a client operating in Lithuania;
• to work in the employer’s branch, representative office, group company or other workplace;
• to work as a temporary agency worker.

For such an employee, whatever law governs the contract, Lithuanian rules on the core working conditions apply (Article 108(2) DK). They include: maximum working time and minimum rest time, the minimum length of paid annual leave, pay, including higher pay for overtime, night work and work on rest days and public holidays, occupational safety and health, and the prohibition of discrimination. If the law of the employee’s own country is more favourable to them, it applies (Article 108(8) DK).

When a posting lasts longer than 12 months, almost all Lithuanian labour law applies. The exception is the rules on concluding and terminating an employment contract and on non-compete agreements (Article 108(4) DK). If the employer files a reasoned notification with the State Labour Inspectorate (Valstybinė darbo inspekcija) while the actual posting has not yet exceeded 12 months, this period is extended, but to no more than 18 months (Article 108(5) DK). For short postings of no more than thirty days, the rules on pay do not apply in the first two cases (Article 108(10) DK). A separate exception covers the initial assembly or first installation of goods where the posting does not exceed eight days, except for construction work (Article 108(11) DK).

Two formalities worth remembering. Article 109(1) DK requires the State Labour Inspectorate to be informed before work in Lithuania starts if the posting is longer than thirty days or involves construction work. Article 109(2) DK requires the documents on the posted employee to be kept at the place of work for the whole posting.

If the employer is not from an EU or European Free Trade Association state, its posted employee must obtain a permit under the procedure set by Lithuanian law (Article 108(9) DK). Whether a permit was needed in a particular case has, in our practice, depended on how long the person stays in Lithuania. This is a question of migration law, which we assess together.

Social insurance and tax – a separate check

Labour law answers which working conditions apply and how to formalise the contract. It does not answer in which country social insurance contributions are paid and where the income is taxed. That is decided by other legislation. We recommend checking this with an accountant or tax adviser before signing the contract amendment, not after.

How to start

Tell us in which country the employee lives and will work, for how long, and what employment contract has already been signed. We will tell you whether the contract needs to change, which law applies and which notifications to file.

Phone +370 5 212 1506, email info@linden.lt

More about this service: labour law consultations.