Fixed-term employment contracts in Lithuania: termination rules and key considerations

Fixed-term employment contracts in Lithuania offer employers flexibility but come with specific regulations to prevent indefinite use and ensure employee rights.

These contracts are established for a defined period or to complete specific tasks, with the end date clearly stated in the agreement. Common scenarios include hiring someone to temporarily cover a colleague on parental leave. While the Labor Code allows for flexible work arrangements, fixed-term contracts are not meant for unlimited application. The law sets limits on their duration and provides additional guarantees for employees.

Generally, a fixed-term contract for performing the same job function cannot exceed two years. An exception exists when an employee is hired to temporarily fill the position of an absent worker. If sequential fixed-term contracts are signed with the same employee for different job functions, their combined duration cannot exceed five years. Specific employee groups, such as elected officials, creative professionals, or researchers, may have separate rules governed by special laws.

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Darbo kodeksas leidžia darbdaviams lanksčiau organizuoti darbą, tačiau terminuotos darbo sutartys negali būti naudojamos neribotai. Įstatymas aiškiai nustato tiek jų trukmės ribas, tiek papildomas garantijas darbuotojams.

A key aspect is the automatic conversion to an indefinite-term contract. If a fixed-term contract expires and the employee continues working, and the employer does not formally terminate the contract within one working day, the contract automatically becomes indefinite. In such cases, the employment relationship can no longer be ended based on the contract's expiry; other grounds for termination under the Labor Code must be applied.

Additional guarantees are provided for employees under fixed-term contracts. If employment lasts over one year, the employer must provide written notice of termination at least five working days in advance. For employment exceeding three years, this notice period increases to ten working days. Furthermore, employees whose fixed-term contracts have lasted over two years are entitled to a severance payment equivalent to one month's average salary upon the contract's termination.

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Tokiu atveju darbo santykiai nebegali būti nutraukiami remiantis terminuotos darbo sutarties pabaiga. Darbdavys turėtų taikyti kitus Darbo kodekse numatytus darbo sutarties nutraukimo pagrindus.