From 7 June 2026, every employer in Lithuania must comply with the EU Pay Transparency Directive (Directive EU 2023/970), transposed into Lithuanian law through amendments to the Labour Code. This is not a large-company regulation. It applies to every employer in Lithuania regardless of size: one employee or one thousand. If you have anyone on a Lithuanian employment contract, you have obligations to meet before the deadline. This guide explains what the law requires, what happens if you do not comply, and how 1Office Lithuania helps businesses get compliant without losing weeks of management time to paperwork.
What Is This
The EU Pay Transparency Directive: what it is and why Lithuania is moving fast
The EU Pay Transparency Directive (Directive EU 2023/970) entered into force in June 2023, giving EU member states three years to transpose it into national law. The deadline is 7 June 2026. While many EU countries have delayed their implementation or are still working through the legislative process, Lithuania is one of the few that is on track to meet the deadline in full. The Lithuanian government approved updated draft legislation on 18 March 2026 and submitted it to the Seimas (Parliament) for final approval, with the new rules planned to take effect on 7 June 2026.
The Directive is aimed at ensuring equal pay for equal work or work of equal value between men and women. But the practical impact is much wider than that. It fundamentally changes how employers must structure, document, and communicate their pay practices. It gives employees significantly expanded rights to information about how they are paid relative to their colleagues. And it shifts the legal burden of proof in pay discrimination disputes onto the employer, not the employee.
For most Lithuanian businesses, the three biggest practical challenges are: building a formal, documented remuneration system that meets the new legal standards; classifying all job positions into defined, gender-neutral job categories; and setting up the monthly Sodra reporting that the new rules require. None of these are quick tasks, and none of them were required in this form before.
Lithuania already required salary ranges in job postings and banned salary history questions since 2019. These elements of the Directive were already in Lithuanian law. What is new from June 2026 is the formal remuneration system requirement, the job category classification obligation, the monthly Sodra pay data reporting, and the expanded employee rights to pay information. These apply to all employers, not just larger ones.
What You Must Do
What the DAS Directive requires from Lithuanian employers from 7 June 2026
The requirements below are based on the Lithuanian draft legislation approved by the government on 18 March 2026. The final text may be adjusted slightly by Parliament before adoption, but the core obligations are confirmed and employers should be preparing against them now.
1. Establish a formal remuneration system
Every employer in Lithuania, regardless of size, must have a formal, documented remuneration system in place. This is the central requirement of the Directive and the one that takes the most time to get right. The remuneration system must define job groups based on objective and gender-neutral criteria, specify forms of remuneration and pay ranges or fixed amounts for each job group, set out the grounds and procedures for supplementary pay, bonuses and allowances, include indexation criteria and procedures for pay increases, and explain the criteria and procedures by which pay increases are determined. Employers with fewer than 50 employees are exempt from the pay increase criteria component, but the core job classification and pay range requirements apply to everyone. The system must be established in consultation with employee representatives where applicable. Where a collective bargaining agreement covers the company, the remuneration system can be established within that agreement.
2. Classify all jobs into gender-neutral job categories
Every position in your company must be assigned to a job category based on objective, gender-neutral criteria. The criteria must cover at least skills, qualifications, effort, responsibility, and working conditions. Jobs that are the same, similar, or of equal value must be placed in the same category. The concept of "work of equal value" is defined in the amended Labour Code and looks at the substance of the work, not just the job title. Getting this classification right is one of the most technically complex parts of compliance: categories that are too broad miss the point, while categories that are too narrow may look like they are designed to obscure pay gaps.
3. Submit monthly pay data to Sodra
From 7 June 2026, all employers must submit monthly data to the State Social Insurance Fund Board (Sodra) covering each employee's pay, working hours, and job category as defined in the remuneration system. This is a significant expansion of existing Sodra reporting requirements. Sodra will use this data to calculate seven gender pay gap indicators for each employer and provide those indicators back to the employer, to the State Labour Inspectorate (VDI), and to the Office of the Equal Opportunities Ombudsman. For employers with at least 8 employees (with at least 4 of each gender), Sodra will also publish the company's average hourly pay broken down by gender on the publicly accessible register.
4. Respond to employee pay information requests
Employees have the right to request written information about their own pay and the average pay of colleagues in the same job category, broken down by gender. Employers must respond to these requests. Salary information that an employee discloses for the purpose of asserting their right to equal pay cannot be treated as confidential or subject to a confidentiality clause. Employers are also required to inform all employees annually of their right to request pay information and explain how they can exercise it.
5. Salary ranges in job postings (already required, now strengthened)
Lithuanian employers have been required to include salary ranges or fixed pay amounts in all job advertisements since 2019. The Directive maintains and strengthens this requirement. Employers are prohibited from asking job applicants about their current or past salary. If a role is covered by a collective bargaining agreement, the relevant agreement provisions must be disclosed to the applicant before the employment contract is signed.
6. Gender pay gap reporting obligations (for larger employers)
For employers with 250 or more employees, annual gender pay gap reporting using 2026 pay data is required, with the first report due by 7 June 2027. For employers with 100 to 249 employees, reporting is required every three years, also starting in 2027. Reports must include mean and median pay gaps, the proportion of men and women receiving variable pay components, and breakdowns by pay quartile. If a pay gap of 5% or more is identified within a job category and cannot be justified by objective, gender-neutral criteria, the employer must remedy the gap within six months. If the gap is not remedied within six months, a mandatory joint pay assessment involving employee representatives becomes required.
| Obligation | Applies to | Deadline |
|---|---|---|
| Formal remuneration system | All employers | 7 June 2026 |
| Job category classification | All employers | 7 June 2026 |
| Monthly Sodra pay data submission | All employers | 7 June 2026 |
| Employee pay information requests | All employers | 7 June 2026 |
| Annual employee notification of pay rights | All employers | 7 June 2026 |
| Salary range in job postings | All employers | Already required since 2019 |
| Gender pay gap reporting (annual) | 250 or more employees | First report 7 June 2027 |
| Gender pay gap reporting (every 3 years) | 100 to 249 employees | First report 7 June 2027 |
| Joint pay assessment if gap over 5% | All employers where gap identified | Within 6 months of gap identification |
1Office Lithuania starts with a compliance questionnaire to map your existing pay structures against the DAS Directive requirements before preparing documentation.
Penalties
What happens if your company is not compliant by 7 June 2026
The Lithuanian draft legislation introduces a layered enforcement framework. Non-compliance is not just a theoretical risk: Lithuania has existing equality enforcement structures that will be strengthened once the Directive takes effect, and both the State Labour Inspectorate (VDI) and the Office of the Equal Opportunities Ombudsman will have access to the pay data that Sodra collects from employers.
Administrative fines for companies
Administrative fines for pay transparency or reporting violations range from €400 to €6,000 per violation. These fines apply to the company. For persistent non-compliance, fines can be applied repeatedly. A company that fails to establish a compliant remuneration system, fails to provide required pay information to employees, or fails to submit accurate data to Sodra is exposed to these fines from the first enforcement action.
Fines for individual company representatives
The enforcement framework also creates personal liability for individual company representatives, including HR officers and managers with responsibility for pay compliance. Individual fines range from €460 to €1,400. This means the obligation is not just a company-level matter. The people within the organisation responsible for implementing and maintaining the remuneration system have personal exposure if the system is not in place or is not maintained correctly.
Employee compensation claims
Beyond administrative fines, the Directive gives employees a broad right to compensation where pay transparency obligations have been breached. Compensation includes full recovery of any unpaid wages and related bonuses or payments in kind, compensation for lost opportunities, non-pecuniary damages, and interest on any arrears. If the pay gap involves multiple discrimination grounds, such as gender combined with ethnicity or age, compensation for all related harm applies. If an employer wins a pay discrimination case, the employee is not required to pay the employer's legal costs. The financial exposure from a single well-documented employee claim can significantly exceed the administrative fine.
Reversal of the burden of proof
Under the amended legislation, the burden of proof in pay discrimination disputes shifts to the employer. If an employee brings a claim alleging pay discrimination, the employer must prove that the pay difference is justified by objective, gender-neutral criteria. The employee no longer has to prove that discrimination occurred. For any company without a documented, compliant remuneration system and clear job category classifications, this reversal creates serious legal exposure in any pay dispute from 7 June 2026 onwards.
For employers with at least 8 employees (including at least 4 men and 4 women), Sodra will publicly disclose your company's average hourly pay broken down by gender. This is searchable by anyone, including your employees, job applicants, competitors, clients, and journalists. If your pay data reveals a significant gender gap, it will be publicly visible before you have had a chance to explain or address it. Having a compliant, documented remuneration system is the only way to demonstrate that any differences reflect objective, legitimate criteria.
Where Most Companies Get Stuck
The hardest parts of DAS Directive compliance for small and mid-sized Lithuanian employers
1Office Lithuania works with companies at every stage of the compliance process. These are the areas where most businesses get stuck, particularly those without dedicated HR or legal departments.
Building a remuneration system from scratch
Many Lithuanian companies, particularly those with under 50 employees, have never needed a formally documented remuneration system. Pay has historically been set informally, based on market rates, individual negotiations, or management judgment. The DAS Directive requires that all of this be systematised: pay ranges documented by job category, criteria for pay decisions written down, and the logic made defensible against an objective standard. For companies that have not done this before, building a compliant system from scratch typically takes several weeks and requires input from both HR and legal expertise.
Job category classification that is actually objective
Classifying jobs into gender-neutral categories based on skills, effort, responsibility, and working conditions is more complex than listing job titles. Jobs with different titles but similar functions must be grouped together. Jobs with the same title but materially different responsibilities may need to be separated. The classification must stand up to scrutiny from both VDI inspectors and from employees who believe they are doing work of equal value to a higher-paid colleague. Getting this wrong creates exactly the kind of legal exposure the Directive is designed to close.
Sodra monthly reporting setup
The monthly pay data submission to Sodra requires that each employee's record includes their job category as defined in the company's remuneration system. This creates a direct link between your internal HR documentation and the state reporting system. If your internal job categories are inconsistently applied or not yet defined, the Sodra submission will not be accurate, which creates further compliance risk.
Employee communication and internal policies
The obligation to inform all employees annually of their right to request pay information, and to respond to those requests within a set timeframe, requires internal policies and communication processes that most companies do not currently have. Setting these up alongside the remuneration system and job classification work is part of full DAS compliance, not an optional extra.
1Office Lithuania handles the full DAS compliance process: questionnaire, remuneration system, job classification, documentation. €400 for a complete service.
How 1Office Helps
What the 1Office Lithuania Pay Transparency Compliance Service includes
1Office Lithuania has built a specific service for Lithuanian employers who need to comply with the DAS Directive before 7 June 2026. The service is priced at €400 and is designed to take the compliance workload off the business and onto a team that combines Lithuanian payroll expertise with legal documentation experience. Here is what is included.
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Prior compliance questionnaire. Before any documentation is prepared, 1Office starts with a structured questionnaire to map your existing pay structures, current job categories, and pay practices against the DAS Directive requirements. This scoping step identifies the gap between where your company is now and where it needs to be by 7 June.
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Full DAS document preparation and handling. 1Office prepares all required documentation: the formal remuneration system, job category classification framework, pay range documentation, and the internal policy documents required for employee communication and rights management. All documents are prepared to meet Lithuanian legal standards under the amended Labour Code.
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Payroll and HR expertise combined. DAS compliance sits at the intersection of payroll, HR, and employment law. 1Office Lithuania's team brings all three together, which means the documents produced are not just legally correct in form but practically workable with your actual payroll and reporting setup.
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Guidance on Sodra monthly reporting alignment. We ensure that the job categories defined in your remuneration system align correctly with how employee data will be submitted to Sodra from June onwards, preventing the common problem of internal documentation that does not match state reporting.
The service is available to any Lithuanian employer regardless of whether they are an existing 1Office accounting client. If you manage your own payroll or use a different accounting provider, you can still use this service as a standalone compliance solution. Contact 1Office Lithuania to discuss your situation before the deadline.
A remuneration system that is prepared without understanding the legal requirements creates a false sense of compliance. A poorly drafted job classification that groups unrelated roles together, or one that inadvertently separates roles doing equivalent work, does not satisfy the Directive. The test is not whether a document exists, but whether it holds up to scrutiny from VDI, Sodra, and a disgruntled employee's legal representative. 1Office Lithuania prepares documentation that is built to that standard.
Practical Checklist
What every Lithuanian employer should be doing right now
If you are an employer in Lithuania and have not yet started your DAS Directive preparation, here is the practical sequence of steps to get to compliance before 7 June 2026.
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Map your current pay structure. List all positions in your company, their current pay levels or ranges, and any variable pay components (bonuses, allowances, commissions). This is the raw material for both the job classification work and the remuneration system drafting.
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Review existing pay documentation. Does your company have any existing remuneration policy, salary scales, or HR documentation? If so, assess whether it meets the new requirements. Most informal pay policies do not come close to satisfying the structured job category and pay range requirements of the Directive.
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Check your job postings. Salary ranges must be included in all job advertisements. This has been required in Lithuania since 2019, but many companies still publish postings without clear pay information. Confirm this is consistently applied before the Directive takes effect.
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Remove salary history questions from your hiring process. If your application forms, interview scripts, or HR procedures include any questions about a candidate's current or previous salary, remove them. This is prohibited from 7 June 2026.
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Do not wait for the final law text. The government-approved draft legislation from March 2026 is the working text. Final parliamentary approval may make minor adjustments, but the core obligations are confirmed. Companies that wait for final publication before starting will not have enough time to prepare properly before 7 June.
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Engage professional help if you do not have dedicated HR and legal resources. The DAS Directive is not a box-ticking exercise. The documentation must reflect your actual pay practices, be legally defensible, and align with your Sodra reporting. For most small and mid-sized Lithuanian businesses, this requires external expertise. 1Office Lithuania's Pay Transparency Compliance Service is specifically designed for this.
FAQ
Frequently asked questions about the EU Pay Transparency Directive in Lithuania
Does the DAS Directive apply to small companies in Lithuania?
Yes. The Lithuanian implementation applies to all employers regardless of size. There is no minimum employee threshold for the core obligations: formal remuneration system, job category classification, monthly Sodra reporting, and employee pay information rights all apply from the first employee. The only size-based distinction is that companies with fewer than 50 employees are exempt from including formal pay increase criteria in their remuneration system. Gender pay gap reporting obligations apply to companies with 100 or more employees, with the first reports due in June 2027.
What is a remuneration system and does my company need one?
A remuneration system is a formal document that defines your company's approach to pay: what job categories exist, what pay ranges apply to each, what the criteria are for variable pay components, and how pay increases are determined. From 7 June 2026, every Lithuanian employer must have one that is based on objective, gender-neutral criteria. Most small and medium Lithuanian companies do not currently have a formal remuneration system that meets this standard. Building one that is legally compliant and reflects your actual pay practices is the core of DAS Directive preparation.
What are the penalties for not complying with the DAS Directive in Lithuania?
Administrative fines for companies range from €400 to €6,000 per violation. Individual company representatives, such as HR officers, face fines of €460 to €1,400. Beyond fines, employees can bring compensation claims for the full recovery of any unpaid wages, related bonuses, lost opportunities, non-pecuniary damages, and interest. In pay discrimination disputes, the burden of proof shifts to the employer, who must demonstrate that pay differences are justified by objective criteria. If the employer cannot, compensation applies regardless of intent.
Will my company's pay data be made public?
From June 2026, Sodra will publicly disclose the average hourly pay broken down by gender for all Lithuanian employers with at least 8 employees, of whom at least 4 are men and at least 4 are women. This is a searchable public register. It does not disclose individual employee salaries, but it does make your company's average gender pay gap publicly visible. For employers with 100 or more employees, detailed gender pay gap reports covering pay by category, mean and median gaps, and variable pay distributions will also be required from June 2027.
My company already has a salary policy. Does it satisfy the new requirements?
Possibly partially. Lithuania already required salary ranges in job postings and banned salary history questions since 2019, so if your company is compliant with existing Lithuanian labour law those elements are in place. What the DAS Directive adds is the formal job category classification using objective gender-neutral criteria, the documented remuneration system covering pay ranges and variable pay criteria for each category, and the monthly Sodra reporting aligned to those categories. A general salary policy or pay scale document is unlikely to satisfy all of these without revision.
Can 1Office prepare our DAS compliance documents if our payroll is handled by a different provider?
Yes. The 1Office Lithuania Pay Transparency Compliance Service is available to any Lithuanian employer, regardless of whether 1Office handles your payroll or accounting. You do not need to be an existing 1Office client to use the service. Contact us to discuss your situation and we will confirm the timeline and what information we need from you to start.
What if the final Lithuanian law changes after parliamentary approval?
The core obligations set out in the government-approved draft legislation from 18 March 2026 are confirmed and unlikely to change materially before adoption. Minor adjustments are possible during the parliamentary process, but the fundamental requirements (remuneration system, job classification, Sodra reporting, employee rights) are fixed. Waiting for final publication before starting preparation risks missing the June 7 deadline. 1Office Lithuania monitors the legislative process and will update documentation if any changes are made before the final law takes effect.
Get your company compliant before 7 June 2026
1Office Lithuania handles the full DAS Directive compliance process: questionnaire, remuneration system, job classification, and all required documentation. Professional preparation for €400.
