Lithuania: Latest working life developments – Q2 2016
The debate on the controversial new Labour Code, the opening of an information centre for posted and migrant workers, and the rise in the minimum monthly wage are the main topics of interest in this article. This country update reports on the latest developments in working life in Lithuania in the second quarter of 2016.
Parliament debates new Labour Code
On 12 April 2016, the Seimas (the Lithuanian Parliament) started debating the draft Labour Code (DLC), which had already been the subject of lengthy preparation and discussion. The code makes several changes to the development of social dialogue and social partnership and also significantly deregulates individual labour relations and working hours. Many of the provisions that had been criticised by unions were improved during its reading at the Parliament’s Committee of Social Affairs and Labour. However, the Seimas began deliberating on the initial version of the code, which had been prepared by the government, instead of the version as amended by the Committee. The Seimas adopted the code on 21 June: the same day the Tripartite Council of the Republic of Lithuania (LRTT) decided to ask the President to veto the law approving the code, its coming into force and its implementation. If the law were to be signed by the President, the new Labour Code would become effective on 1 January 2017.
Social partners’ reaction to the liberalisation of the Labour Code
During the second quarter of 2016, Lithuanian trade unions initiated a number of protest campaigns and rallies against the new code. Other bodies, particularly youth groups, supported them. On 29 April, national peak-level union organisations launched their campaign, ‘For Higher Wages and Children’s Dreams Coming True’, to show solidarity with workers fighting for higher wages and better working conditions. Also in April, unions campaigned for active participation in parliamentary sittings. In June, they staged a protest in front of the Parliament building, proclaiming, ‘We will stay here and we will vote again’, in protest at the liberalisation of the code and other laws. In June, the ‘Life is too Expensive’ movement launched a campaign initiated by Lithuanian youth groups and supported by the peak-level union organisations.
Employer organisations were less active on this issue. The initial view of the main employers’ organisation, the Lithuanian Confederation of Industrialists (LPK), on the new code was ambiguous as, although it contains positive changes, the adopted version is not as flexible as originally proposed. On 27 June, however, LPK stated in a press release:
The adoption of the DLC is the first realistic step towards reforms necessary for the implementation of the flexicurity model that would not only serve for ensuring an environment favourable for Lithuania’s economic growth, but would also create opportunities for more expeditious and flexible responding to the global economic environment and contribute to the well-being of employees.
On 30 June, the President met social partner organisations to discuss the most controversial of the code’s provisions, which are mainly related to the balance between employment security and labour market flexibility. The meeting revealed that certain articles of the code had been adopted without heeding the wishes of the people and also ignoring the compromises agreed at the LRTT. Taking into account the sensitivity of the issue, at the beginning of July the President sent the code back to the Seimas to revise the provisions that had been so controversial. The President proposed amending 22 articles of the code’s 260 articles in order to restore the balance between employer interests and employee security. Proposals for the amendments included:
- increasing severance pay;
- extending the notice period for terminating contracts;
- abolishing zero-hour contracts.
New information centre for posted and migrant workers
On 21 April, the first information centre in Europe for posted and migrant workers was opened at the Kalvarija border crossing post near the Lithuanian–Polish border. The centre’s purpose is to provide information and consultation on issues related to employment contracts, employment relationships, payment of daily allowances, calculation of work time and rest time. The centre is also equipped with rest rooms and medical examination rooms. Information is provided in Lithuanian, Latvian, Estonian, Polish, Russian and Byelorussian.
Rise in minimum monthly wage
An increase in the minimum monthly wage (from €350 to €380), starting on 1 July, was adopted by the government, despite demands from some employers to postpone it. The agreement had already been reached in 2015.