{"id":2985,"date":"2026-10-07T22:19:25","date_gmt":"2026-10-07T19:19:25","guid":{"rendered":"https:\/\/linden.lt\/tinklarastis\/pay-transparency-fines-and-disputes-lithuania\/"},"modified":"2026-10-07T22:19:25","modified_gmt":"2026-10-07T19:19:25","slug":"pay-transparency-fines-and-disputes-lithuania","status":"publish","type":"irasas","link":"https:\/\/linden.lt\/en\/blog\/pay-transparency-fines-and-disputes-lithuania\/","title":{"rendered":"Fines and disputes: the risk of having no pay system in Lithuania"},"template":"","kategorija":[],"class_list":["post-2985","irasas","type-irasas","status-publish","hentry"],"acf":{"visi_puslapiai_cta_statusas":false,"visi_puslapiai_cta_antraste":"","visi_puslapiai_cta_formos_id":"","visi_puslapiai_cta_papildomas_tekstas":"","visi_puslapiai_cta_nuotrauka":null,"tinklarastis_1_autorius":null,"tinklarastis_1_iraso_tipas":false,"dinamiski_blokai":[{"acf_fc_layout":"tekstas","tekstas":"

A pay system must be approved or reviewed by 31 December 2026 (Article 23(4) of Law No. XV-969). Without one, three things can follow: an administrative fine, an employee's claim and, if you bid in public tenders, a risk of exclusion. In our view,<\/strong> for a small company the biggest risk is not the fine but a dispute with any departing employee. Once the employee points to facts from which discrimination may be presumed, the employer must prove there was none (DK Article 26(5)), and without a system there is nothing to rely on. What exactly must be done is set out in \"Pay transparency in Lithuania: what employers must do, and by when\"<\/a>.<\/p>\r\n

The risks in one table<\/h2>\r\n

| Risk | Who starts it | What follows | |---|---|---| | Administrative fine | VDI; from 2027, for failing to give information, also Sodra and the Equal Opportunities Ombudsperson | Fines under Article 99 of the ANK | | Employee's claim | A current or former employee | Unpaid pay, damages, compensation | | Public procurement | The contracting authority | Possible exclusion from a tender |<\/p>\r\n

Administrative fines<\/h2>\r\n

The law:<\/strong> fines are set by Article 99 of the Code of Administrative Offences (ANK). Law No. XV-970 amended it: some changes apply from 7 June 2026 and others from 1 January 2027 (Article 5 of Law No. XV-970).<\/p>\r\n

Now.<\/strong> A breach of the rules on setting, calculating and paying wages laid down in the pay system or the Labour Code carries a fine of five hundred to one thousand four hundred and fifty euros (ANK Article 99(1)). A repeat breach carries one thousand four hundred and fifty to three thousand euros (ANK Article 99(2)). An intentional breach: two thousand seven hundred to six thousand euros (ANK Article 99(3)).<\/p>\r\n

From 1 January 2027<\/strong> there is a new offence: failing to give pay information required by the Labour Code to employees, their representatives, VDI, Sodra or the Equal Opportunities Ombudsperson. It carries four hundred and sixty to seven hundred euros, and seven hundred to one thousand four hundred euros for a repeat (ANK Article 99(1) and (2), edition from 2027-01-01). The fines for breaching pay-setting rules stay the same and move to parts 3\u20135 (ANK Article 99(3)\u2013(5), edition from 2027-01-01). VDI gives the same amounts (VDI FAQ, question 6.7).<\/p>\r\n

Who investigates.<\/strong> VDI investigates Article 99 offences (ANK Article 589, point 58). From 1 January 2027 the Equal Opportunities Ombudsperson and Sodra may also investigate and draw up reports on failing to give information (ANK Article 99(1) and (2); ANK Article 589, points 3 and 72, edition from 2027-01-01).<\/p>\r\n

Is there a fine just for having no system?<\/strong> Unless a collective agreement sets the pay system, the Labour Code requires the employer to approve a system (DK Article 140(3)). In our view,<\/strong> after 31 December 2026 a missing system may be treated as a breach of the pay-setting rules. Another reading is a breach of labour laws, which carries a fine of two hundred and forty to eight hundred and eighty euros (ANK Article 96(2)). We are not aware of published case law on how failing to approve a system after 31 December 2026 is classified, so it is our opinion, not settled law.<\/p>\r\n

An employee's claim: the employer must prove<\/h2>\r\n

Once an employee points to facts from which discrimination may be presumed, the employer must prove there was no discrimination (DK Article 26(5)). Such a fact may be that a colleague of the other sex doing the same work or work of equal value earns more. The employer must then prove the difference rests on objective, gender-neutral criteria. If there is no comparable employee of the other sex, the employee may rely on any other evidence, including statistics (DK Article 26(4), point 3). The comparison is not limited to employees hired at the same time (DK Article 26(4), point 4).<\/p>\r\n

What can be awarded.<\/strong> If the employer breached the duty to pay equally, the employee is awarded compensation (DK Article 219(2)). It covers all unpaid pay or payments in kind, pecuniary and non-pecuniary damage, and compensation for lost work-related opportunities. In court cases on pay discrimination the court may depart from the usual rules on the allocation of legal costs (DK Article 217(4)).<\/p>\r\n

Deadlines.<\/strong> A claim goes to the labour disputes commission within three months from when the employee learned or should have learned of the breach (DK Article 220(1)). A missed deadline can be renewed if the commission finds the reasons important (DK Article 220(2)). Even if it is not renewed, the employee may go to court within one month of the commission's decision (DK Article 231(1)). The general limitation period is three years (DK Article 15(2)). In our view,<\/strong> a claim may cover up to three years, and from 2027 the day the employee \"learned\" may coincide with the day they receive their group's data.<\/p>\r\n

Why this matters for a small company.<\/strong> In our view,<\/strong> an employee who is dismissed or leaves on bad terms may also raise pay. If by the end of the year they received nothing about a pay system, it will be easy for them to say there is none. Without a system and scoring sheets it is very hard for the employer to prove a difference was justified.<\/p>\r\n

A complaint to VDI<\/h2>\r\n

From 2027 an employee may ask in writing for their own pay data and the average pay by sex in their position group (DK Article 148(4), edition from 2027-01-01). The answer is due within one month (DK Article 148(5), edition from 2027-01-01). Employees may submit requests from 1 March 2027 (Order No. A1-433, point 2.3), and the employer provides the data once it receives them from Sodra. At first only monthly indicators (average pay per hour) are given (the first, in March 2027, for January); annual indicators follow from 1 March 2028 (Order No. A1-433, point 2.3). If the data are inaccurate or incomplete, the employee may demand additional explanations. Giving them may not take longer than 2 months from the day the employee's request for the data was received (DK Article 148(5), edition from 2027-01-01). In VDI's view, the 2 months run from the day the request for additional explanations was made (VDI FAQ, question 6.8). Our recommendation:<\/strong> plan for the earlier date, that is, under the statute, from the original request. If the explanations are not given, the employee may complain to VDI, and VDI may order the employer to provide the information and impose a fine (VDI FAQ, question 6.8). So a complaint is a route by which an inspection can reach a small company too.<\/p>\r\n

VDI stresses that 5 % is not an allowed gap: any unjustified pay gap between men and women for the same work or work of equal value is a breach (VDI FAQ, question 7.1). Employers with 100 or more insured persons may in some cases also have to carry out a joint pay assessment (DK Article 23(11), edition from 2027-01-01). This 5 % and six-month rule applies from 2027, but in practice starts only once Sodra delivers the first indicators: by 1 March 2028 (150+ insured persons) or by 1 March 2031 (100\u2013149) (Law No. XV-969, Article 23(5)). Before 1 January 2027 the only such duty was for an employer with an average headcount of more than 20 to give, at least once a year at the request of the works council (or, if none, the trade union operating at employer level), anonymised data on average pay by position group and sex (excluding managerial staff, where the group has more than 2 employees) (DK Article 23(2)); that duty continues after 1 January 2027.<\/p>\r\n

Lessons from abroad.<\/strong> In the UK, nearly 1,900 warning notices were sent in 2023\u20132025 for failing to file gender pay gap reports, and not a single fine was imposed (regulator data obtained by the law firm Lewis Silkin, 2026-03-26). The bigger risk there is disputes. On 7 September 2026 the Employment Appeal Tribunal held in Next Retail Ltd v Thandi<\/em> ([2026] EAT 130) that the retailer Next could pay warehouse staff higher basic pay than shop staff. The tribunal found that the aim of that pay included recruitment and retention needs for warehouse staff that did not exist in the shops. It rejected Next's appeal on other differences, such as a lower night premium and unpaid breaks in the shops. This is not Lithuanian case law. In our view,<\/strong> the lesson applies here too: only a reason you can prove with documents defends a difference.<\/p>\r\n

Public procurement risk<\/h2>\r\n

A contracting authority may exclude a supplier from a procurement procedure if it has breached the social and labour law obligations referred to in Article 17(2), point 2, of the Law on Public Procurement (VP\u012e Article 46(6), point 1). Exclusion is possible if less than one year has passed since the breach. It is not automatic: the contracting authority decides, and it must prove the breach \"by any appropriate means\" (VP\u012e Article 46(6), point 1). Before excluding, it must assess whether exclusion is proportionate to the supplier's conduct (VP\u012e Article 46(8)). In its ruling of 4 January 2024 in civil case No. e3K-3-65-381\/2024, the Supreme Court of Lithuania held that proportionality must be assessed every time exclusion under Article 46(4) or (6) of the VP\u012e is considered (para. 98). A formal, one-off minor breach with no significant bearing on the supplier's reliability should not be treated as making exclusion proportionate (para. 101). Exclusion can be avoided by showing reliability: paying or undertaking to pay compensation for the harm and cooperating in the investigation (where applicable) and taking preventive measures, if the contracting authority accepts them as sufficient by a reasoned decision (VP\u012e Article 46(10)). In the same ruling the court said a supplier can rely on this only in a later procurement, not in the one it has already been excluded from (para. 110). In our view,<\/strong> a VDI decision on a pay breach could be such evidence.<\/p>\r\n

What to do now<\/h2>\r\n
  1. By 31 December 2026,<\/strong> after informing and consulting employees, approve the pay system<\/a> and make all employees familiar with it, keeping the confirmations.<\/li>
  2. Our recommendation: by 31 January 2027,<\/strong> write down an objective reason for every pay difference within a group. Where there is none, plan how to fix it.<\/li>
  3. By 1 March 2027,<\/strong> prepare a reply template for employee requests and a request register.<\/li>
  4. Always<\/strong> keep the scoring sheets, the consultation protocol and the reasons for pay decisions. In a dispute they are your main evidence.<\/li><\/ol>\r\n

    What to do if...<\/h2>\r\n

    ...a departing employee says they were underpaid.<\/strong> Ask them in writing whom they compare themselves with and for which period. Collect the system for that period, the scoring sheet and the reason for their place in the range. Reply in writing, without admissions. A sample reply is in \"An employee demands equal pay: what the employer should do\"<\/a>.<\/p>\r\n

    ...VDI sends an enquiry.<\/strong> Provide the approved system, evidence of the consultation and the confirmations that employees were made familiar with it. If there is no system yet, say when you will approve it and start work at once.<\/p>\r\n

    ...there is no system yet and an employee is already disputing pay.<\/strong> Do the scoring now and date it. It will not fix the past, but it will show whether a gap exists at all and help you decide about a settlement.<\/p>\r\n

    Related articles<\/h2>\r\n