Latvia Employment Guide

Latvia, located in Northern Europe along the Baltic Sea, has a population of around 1.9 million. The country’s economy is driven by services, manufacturing, and information technology. Latvian labor law governs employment contracts, working hours, leave entitlements, minimum wage, and employee protections. Social security contributions cover pensions, healthcare, and unemployment benefits. Employers must comply with regulations on fair treatment, occupational safety, and employee rights. Latvia encourages skilled foreign workers to support its growing technology and service sectors.

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Currency

Euro (EUR)

Capital

Riga

Official language

Latvian

Salary Cycle

Monthly

Our Employment Guide in Latvia

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Navigating Employment Termination in Latvia: A Guide for International Employers

Terminating employment contracts in Latvia requires careful adherence to complex legal frameworks and country-specific regulations. The separation process must be handled collaboratively between employers and key stakeholders, often involving transitional costs and mandatory procedures depending on the termination circumstances.

Valid Grounds for Employment Termination

Latvian labor law does not recognize at-will employment beyond probation periods. Employers must demonstrate legitimate reasons for termination, which typically fall into three categories:

Employee-initiated resignation
Mutual agreement between parties
Employer-initiated termination based on grounds specified in Section 101 of the Labor Law

Notice Period Requirements

The statutory minimum notice period is one month, though employment contracts may specify shorter durations if mutually agreed upon. For example, SailGlobal typically recommends aligning notice periods with industry standards while ensuring compliance with local requirements.

Severance Pay Obligations

Latvian law mandates severance payments for employees terminated under specific circumstances:

Insufficient work qualifications or capabilities
Health-related incapacity supported by medical certification
Reinstatement of previous position holder
Workforce reduction initiatives
Employer liquidation proceedings
Temporary disability affecting work performance

Severance Calculation Structure

Compensation amounts correlate with employee tenure:

Employment Duration	Severance Amount
Less than 5 years	One month's average earnings
5-10 years	Two months' average earnings
10-20 years	Three months' average earnings
Over 20 years	Four months' average earnings

International companies like SailGlobal often supplement statutory requirements with enhanced separation packages to maintain positive employer branding.

Practical Considerations for HR Professionals

Documentation remains critical throughout termination processes. Employers should maintain records of performance reviews, communication attempts, and legal consultations. Recent cases demonstrate that proper documentation can prevent lengthy disputes before Latvian labor courts.

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