Collective bargaining in Lithuania

Collective bargaining takes place mostly at company level (except in a few sectors). Despite the efforts of the social partners to increase the importance of sector-level collective bargaining, the practice is still not widely accepted in the private sector. Since 2017–2018, a number of sectoral (in the education, healthcare and social care sectors) and cross-sectoral collective agreements have been permanently signed/renewed in the public sector. These cover some wage-related issues. National-level social dialogue has played a relatively important role for a number of years. However, the social partners’ discussions and negotiations in the TCRL cannot be considered real collective bargaining.

According to the European Company Survey 2019, 10% of employees (in private sector companies with establishments with more than 10 employees) were covered by collective wage bargaining in Lithuania in 2019.

According to expert evaluations and some other sources (for example OECD and AIAS, 2021), the overall collective (wage) bargaining coverage in Lithuania was less than 10–15% until 2018. However, since 2019 the situation has changed: according to the Ministry of Social Security and Labour, collective bargaining coverage in Lithuania reached 15% in 2019, 21% in 2020 and 25% in 2021 (Ministry of Social Security and Labour, 2022). This increase was caused mainly by the increase in coverage in the public sector due to sectoral collective agreements signed between 2018 and 2021.

Collective wage bargaining coverage of employees

Sources: Eurofound, European Company Survey 2013/2019 (including private sector companies with establishments with more than 10 employees (NACE codes B–S), the question in the survey was a multiple choice question and multiple responses were possible); Eurostat [earn_ses10_01], [earn_ses14_01], [earn_ses18_01] (including companies with more than 10 employees (NACE codes B–S, excluding O), with a single response for each local unit); OECD and AIAS, 2021.

Working time in Lithuania is set in national legislation (particularly the Labour Code); at company level, some flexible working arrangements (for example the start/end time of the working day, extra holiday days) may be agreed. At national level, the social partners on the TCRL discuss all amendments to the Labour Code, including provisions regarding working time (for example those on overtime work).

Wages in the private sector are mainly set at company level. However, at national level the social partners on the TCRL have to agree on the minimum wage. In the public sector, wages are set mainly by legislation; some annual increases that have occurred since 2018 are set out in national public sector collective agreements.

Levels of collective bargaining, 2022

Articulation

Articulation does not exist in Lithuania.

There is no particular time when collective bargaining must take place in Lithuania – at all levels it takes place when required. Usually (but not necessarily), company-level collective agreements are signed for a two-year period. Recently, sectoral collective agreements have been signed for a three-year period. According to the Labour Code: ‘A collective agreement shall be valid for no more than four years, except for cases when the collective agreement establishes otherwise’.

There are no known cases of coordination of collective bargaining, either vertically or horizontally, in Lithuania.

According to the Labour Code, valid since 1 July 2017, the scope of individual provisions of national (cross-sectoral), territorial and sectoral (production, services or professions) collective agreements may need to be extended by order of the Minister for Social Security and Labour to bind all the employers of the appropriate territory or sector if such a request has been submitted in writing by both parties to the collective agreement. The request must specify the following: the title of the collective agreement whose scope is to be extended; the scope of extension (whether the entire collective agreement or only certain provisions thereof are to be extended); the grounds for extending the scope of the collective agreement; and the projected number of employees to whom the extended collective agreement will apply. The Minister for Social Security and Labour must take a decision regarding the extension of the scope of the collective agreement within 60 calendar days of receiving the request. Although this provision was in force in both the 2017 Labour Code and its previous versions, it has never been applied in practice.

According to Article 193 of the Labour Code:

the labour law provisions laid down in collective agreements concluded on a national, sectoral or territorial level may derogate from the mandatory rules established in the Code or other labour law provisions, with the exception of rules related to maximum working time and minimum rest periods, the conclusion or termination of an employment contract, minimum wage, safety and health at work, and gender equality and non-discrimination on other grounds, provided that a balance between the interests of the employer and the employees is achieved by the collective agreement. Disputes on the lawfulness of such provisions shall be settled in the procedure established to settle labour disputes on rights. If it is established that a term of a collective agreement contradicts the mandatory rules established in the Code or other labour law provisions, or that a balance between the interests of the employer and the employees is not achieved by a collective agreement, then said may not be applied, and the rule of this Code or labour law provisions shall apply. In any case, a collective agreement may improve the employees[’] situation compared to that established in this Code or other labour law provisions.

Fixed-term collective agreements simply end upon expiry; however, if the original agreement expires during collective bargaining and the bargaining is clearly likely to end with the conclusion of a new collective agreement, the case law of the Supreme Court of Lithuania states that the original collective agreement should automatically remain valid until the signing of the new agreement. If collective bargaining fails, the parties may simply resolve the dispute-related issue and continue to follow the original collective agreement if it is still valid. However, practice shows that employers usually use the opportunity to unilaterally terminate the valid collective agreement.

In accordance with the Labour Code, it is prohibited to call a strike during the term of validity of the collective agreement if the employer complies with the agreement. In this context, the term ‘collective agreement’ is understood in its broad sense, and the view is taken that strikes are prohibited not only when the company’s collective agreement is complied with, but also when the employer, being a member of the employer organisation that has signed the sectoral, territorial or national collective agreement, fulfils the obligations set out in this collective agreement.

The national-level social partners on the TCRL have widely discussed the possibility of making labour legislation more flexible for a number of years. The focus of the discussion around flexibility is job security and working time flexibility.

Since 2017–2018, cross-sectoral collective agreements and several sectoral collective agreements have been permanently signed and renewed in the public sector, covering, among other things, some wage-related issues. Another element that has been widely implemented in these (cross-sectoral and sectoral) collective agreements in the public sector is additional rest/holiday days for members of signatory trade unions.

At company level, significant attention is traditionally paid to OSH and training issues, wages (especially in the private sector), working time flexibility (including work–life balance) and workers’ representation rights.