By Yesenia Salguero
BLOG OVERVIEW: Lithuania approved draft Labour Code amendments on March 18, 2026, transposing the EU Pay Transparency Directive, introducing gender-neutral pay structures for all employers, formal "equal value" definitions, and staggered reporting deadlines starting May 7, 2027. Unlike most EU member states, Lithuania's SoDRA will calculate the required gender pay gap indicators directly from payroll data rather than requiring employers to self-report.
On March 18, 2026, Lithuania's Ministry of Social Security and Labour (SADM) announced the approval of proposed amendments to the Labour Code that further Lithuania’s transposition of the European Union (EU) Pay Transparency Directive (the Directive). The amended legislation has been forwarded to the Lithuanian Parliament (Seimas) for final approval, putting Lithuania on the right track to meeting the EU-wide deadline of June 7, 2026. Additionally, the State Labour Inspectorate (VDI), in collaboration with SADM, published recommendations to assist employers in evaluating their current pay structures and preparing for future compliance.
Key Obligations: What Employers Need to Be Ready For
For employers operating across multiple EU countries, understanding exactly what Lithuania requires and how it compares to the broader Directive is essential. Below is a breakdown of the main obligations proposed in the draft legislation:
Pay Transparency in the Recruitment Stage
Under amended Article 41 and in line with the Directive, employers are prohibited from asking candidates about pay received in current or previous employment relationships. This rule reinforces a practice that Lithuania first implemented in 2019. Additionally, if a collective agreement is in place, the employer must provide the relevant terms to the candidate before any contract negotiations or signing. Lithuanian employers are already required to provide the initial pay or pay range in job notices.
Employers are encouraged to evaluate their current recruitment workflows, interview scripts, and application processes to eliminate any inquiries about salary history and ensure that relevant information from collective agreements is incorporated into the pre-offer stage of the hiring process.
Salary Disclosure Rights
Under amended Article 39, employees are explicitly permitted to disclose their own salary information in order to exercise their right to equal pay for the same work or work of equal value. Confidentiality agreements may not restrict this right.
Pay Structure and Progression Transparency
All employers, regardless of their size, are mandated to implement a formal, gender-neutral compensation system. Job positions must be classified based on objective and gender-neutral criteria that encompass skills, qualifications, effort, responsibility, and working conditions. The system must specify forms of remuneration, pay amounts or limits, supplementary pay grounds, amounts and procedures, indexation criteria and procedures, and pay increase criteria and procedures. Employers with fewer than 50 employees are exempt from providing pay increase criteria and procedures, as permitted by the Directive.
Defining “Same Work” and “Work of Equal Value”
Amended Article 140(5) formally defines "same work” as work activities that are the same or so similar to other work activities that both employees could be interchanged without the employer incurring higher costs. "Work of equal value" refers to work that requires no less qualification and is no less significant for the employer in achieving its business objectives than other comparable work.
These definitions set the legal standard for assessing pay disparities. Notably, pay comparisons are not limited to employees working for the same employer at the same time. Amended Article 26(4) allows comparisons across subsidiaries where pay is determined by a single centralized authority and between employees hired at different times. Where no direct comparator is available within the organization, employees may rely on other evidence, including statistical data or hypothetical comparators, to support their claims.
Employee Right to Pay Information
Under new provisions in Article 148, employees may request written information on their annual salary, monthly hourly average and annual hourly average, as well as the corresponding averages by gender of employees in the same job group. Employers are required to respond within one month of the initial request. If the employee considers the initial data inaccurate or incomplete, they can demand additional explanations from the employer. The total period for providing the initial data and any additional explanations may not exceed two months from the date of the original request. Where disclosure would identify an individual, the information will be provided through employee representatives, the State Labour Inspectorate, or the Equal Opportunities Ombudsman. Employers must inform all staff of this right annually.
Gender Pay Gap Reporting and Joint Pay Assessments
Lithuania already has a centralized pay data model by which SoDRA, Lithuania’s State Social Insurance Fund Board, compiles and publishes pay information including the average pay for women and men at each company. This public register is searchable and includes overall average and median pay breakdowns. Under the amended Article 23, employers must submit monthly data to SoDRA on employee pay, working hours, and job groups as defined in their remuneration system. From this data, SoDRA will calculate and distribute seven gender pay gap indicators that align to Article 9 of the Directive. These indicators will then be provided back to employers, shared with the VDI and the Office of the Equal Opportunities Ombudsperson, and published publicly. The key takeaway is that SoDRA will be the one to calculate and prepare the detailed gender pay gap reports based on the monthly pay data submitted by employers, as opposed to that responsibility falling on employers (as most other member states are doing). For temporary workers, however, affected employers must self-calculate these indicators and submit them to SoDRA.
Lithuania introduces a three-tier reporting timeline: employers with 150 or more insured persons must submit data to SoDRA by May 7, 2027, with public publication by June 7, 2027; employers with 100-149 insured persons (and smaller employers who voluntarily opt in) must submit data by May 7, 2031, with publication by June 7, 2031. For temporary workers, employers in the larger tier must self-calculate and submit those indicators by May 7, 2027, and the smaller tier by May 7, 2031. SoDRA will first provide employers with annual average pay data by job group and gender on July 1, 2027.
In addition, the amended Article 23 requires affected employers to carry out a formal joint pay assessment in line with the Directive minimums (pay gap of 5% or greater, the employer cannot justify the pay gap, and the pay gap is not remedied within six months). Results of joint pay assessments must be submitted to employees, employee representatives, and the VDI. Detailed procedural rules for conducting these assessments will be issued by the Minister of Social Security and Labour.
Enforcement and Penalties
The amendments introduce a layered enforcement framework with financial consequences for non-compliance:
Lithuania Ahead of the Curve
Lithuania enters this process ahead of many EU member states given amendments to existing legislation and is unique in having SoDRA calculate all seven pay gap indicators from existing payroll data, while most member states require employers to independently calculate and submit reports. Several of the Directive's core requirements including salary disclosure in job ads and the ban on salary history questions have been embedded in Lithuanian law since 2019, while gender pay gap reporting and formal pay structures for larger employers have been in place even longer. The incoming legislation primarily expands the scope of these existing obligations, extending pay structure requirements to all employers regardless of size, introducing the 5% remediation threshold with a six-month remediation window, adding explicit definitions of same work and work of equal value, and providing greater specificity to reporting and enforcement.
DCI will continue monitoring developments and provide updates as needed. Sign up to receive our monthly EU Pay Transparency Directive newsletter here.