Wage Transparency in Lithuania: Essential Changes for Employers and Payroll

Following the adoption of amendments to the Labor Code (Law No. XV-969) by the Seimas of the Republic of Lithuania, which transposes the EU Pay Transparency Directive, significant changes are underway for Lithuanian businesses and accounting professionals. While some rules are already active, critical deadlines are fast approaching, especially for small businesses.

Immediate Impact: Changes to Hiring and Confidentiality
As of June 7, 2026, employers are subject to strict new restrictions. Primarily, it is now prohibited to ask job applicants about their current or previous salary history during the recruitment process. Additionally, the approach to salary confidentiality has fundamentally shifted. An employee's wage can no longer be legally bound by confidentiality clauses if the employee chooses to disclose it to enforce their right to equal pay for equal work. It is highly recommended that you review existing employment contract templates and confidentiality agreements to remove any unlawful restrictions on discussing pay.

Mandatory Remuneration System for All Companies
Previously, only larger companies were required to implement a formal Remuneration System (Darbo apmokėjimo sistema - DAS). However, by December 31, 2026, all employers—even those with just a single employee—must establish or update their DAS. This system must be based on objective, gender-neutral criteria, including skills, effort, responsibility, and working conditions. For many small companies (under 20 employees), this is an entirely new obligation that requires immediate job evaluation and internal restructuring.

New Reporting Requirements to Sodra from 2027
Accountants and payroll specialists must prepare for a significant shift in data reporting. Starting January 1, 2027, employers will be required to submit detailed monthly data to Sodra. This includes not only wages and supplementary benefits but also actual paid working time in hours. Furthermore, employers will need to declare each employee's job group, working time norm, and schedule (updating this information whenever changes occur).

Based on this data, Sodra will publicly disclose the average hourly wages of men and women within companies that have at least 8 employees (provided there are more than 3 men and 3 women). While the exact technical guidelines and integration details for Sodra's platform are still pending, businesses should start standardizing their time-tracking and job categorization processes now.

How to Prepare Your Business
Adapting to these transparency laws requires proactive steps across departments. HR professionals must update interview guidelines, management should review internal policies, and payroll specialists need to ensure accounting systems are ready for expanded hourly tracking. Do not leave these adjustments until the last minute—start reviewing your payroll structures today to ensure full compliance.