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Employer of Record Latvia
Hire staff and expand your business in Latvia with our fully-managed EOR Service
How we can help
Unrivalled Employer of Record Service in Latvia designed to expand your business seamlessly
Agility EOR delivers services for business’s looking for an Employer of Record in Latvia. We help clients hire new employees or transfer existing employees into a fully-managed EOR service.
We appreciate that each situation and business is different. That is why our personal approach to Employer of Record Services in Latvia takes care of all HR, payroll, recruitment and compliance head aches, and allows you to do what you love best – driving your business forward.
Employer of Record in Latvia
A Brief Guide to Latvia
Latvia is a small Baltic country known for its rich history, beautiful landscapes, and vibrant culture. The nation offers a mix of sandy beaches, forests, and picturesque countryside settings. Latvia is a parliamentary republic and a member of international organizations such as the European Union, the Schengen Area, and the United Nations.
Category | Information |
Location | Northern Europe |
Capital | Riga |
Official Language | Latvian |
Area | 64,589 square kilometers |
Population | Approximately 1.9 million |
Currency | Euro (EUR) |
Major Cities | Riga, Daugavpils, Liepaja, Jelgava, Jurmala |
GDP (2021) | $35.1 billion USD |
Major Industries | Timber, agriculture, food products, machinery, tourism |
Business Culture
Business Culture in Latvia
In Latvia, the business environment is professional, with emphasis on punctuality and proper planning. Building relationships is key, and small talk is often used to establish rapport. Decision-making tends to be hierarchical, and trust is essential in business dealings. Latvians appreciate expertise and well-prepared meetings.
Following business etiquette, such as exchanging business cards and addressing people by their titles, is customary. Success in the Latvian business world requires adaptability, respect, and relationship-building.
Payroll and Taxes
Payroll and Taxes in Latvia
No, there is no legal requirement for 13th or 14th month pay in Latvia. However, some employers may choose to provide these payments as a form of bonus or additional compensation to employees.
Employee Taxation
In Latvia, income tax rates are progressive, with higher income levels subject to higher tax rates.
| Gross Annual Income (EUR) | Tax Rate (%) |
|---|---|
| Up to EUR 20,004 | 20% |
| EUR 20,004 – EUR 62,800 | 23% |
| Above EUR 62,800 | 31.4% |
Employer Taxation
Employers in Latvia are also responsible for various employer costs, which include:
Fund Type | Percentage |
Social Security | 23.5% |
Accident Insurance | 0.36%-1.8% |
Pension and Healthcare
Latvia Pensions
Latvia has a mandatory state pension system, funded by social security contributions from both employees and employers. The contribution rates, as a percentage of an employee’s gross salary, are as follows:
- Employees: 7.5% for pension insurance
- Employers: 12.5% for pension insurance
Healthcare in Latvia
Latvia’s public healthcare system provides a range of medical services, including primary care, specialist services, hospital care, and prescription medications. Both employees and employers contribute to the system through a percentage of their salaries. This mandatory contribution is collected by the Latvian tax authorities and allocated to the healthcare system.
Employment Law
Employment Law in Latvia
Relevant Legislation: Latvian employment law is governed by various pieces of legislation, including:
• Labor Law
• Law on Holidays and Remembrance Days
• Law on Social Insurance
• Immigration Law
Employment Contracts:Latvian employment contracts should be in writing and include essential information such as duration of employment, working hours, salary, and termination notice periods.
Working Hours: The standard maximum working time in Latvia is 40 hours per week, or 8 hours per day. Overtime work is regulated, with compensation for extra hours.
Leave: Employees in Latvia are entitled to various types of leave, including paid annual leave (minimum of 20 working days per year), maternity leave, paternity leave, sick leave, and family care leave.
Overtime: In Latvia, overtime work is regulated by law and collective agreements. In general, Latvian law stipulates that overtime pay should be at least 1.5 times the regular hourly wage.
Termination: Termination of employment in Latvia requires proper notice, which varies depending on the length of employment. Employers can terminate an employee’s contract if there is a just cause, such as poor performance, misconduct, or redundancy. Employers must provide a written explanation for the termination based on just cause. Unjustified termination can lead to claims for damages or reinstatement.
Notice: Both employers and employees must give notice before terminating an employment contract. The notice period varies depending on the employee’s length of service. Generally, the notice period ranges from 10 days to one month.
Severance Pay: Employees may be entitled to severance pay if they are terminated due to redundancy, restructuring, or other reasons that are not related to their performance or behavior. Severance pay is typically not provided in cases of termination due to misconduct, resignation, or the end of a fixed-term contract. The amount of severance pay an employee is entitled to often depends on their length of service with the employer. In Latvia, employees must have worked for a minimum of three months to qualify for severance pay, and the amount increases with the number of years of service.
IMMIGRATION
Work Permits in Latvia
The immigration process in Latvia is organized and systematic, similar to most countries worldwide. Prospective immigrants usually need to apply for a specific visa or residency permit that corresponds to their reasons for relocating, such as work, education, or joining family members.
Latvia offers several types of work permits for foreign nationals who wish to work in the country. The specific type of work permit required depends on the applicant’s qualifications, the nature of the job, and the intended duration of the stay. Some of the main types of work permits in Latvia include:
- Skilled Worker Permit: This permit is designed for individuals who have specialized skills or qualifications that are in high demand in Latvia. Applicants must have a valid job offer from a Latvian employer and must meet certain educational and professional requirements.
- Temporary Work Permit: This permit is issued for short-term employment and is generally valid for up to 12 months. Temporary work permits are typically granted for seasonal work, internships, or other temporary job opportunities.
- Family Reunification Work Permit: Foreign nationals who are married to or in a registered partnership with a Latvian citizen or a person with a permanent residence permit may be eligible for a work permit through family reunification. This permit allows the holder to work in Latvia without restrictions.
Citizens of European Union (EU) countries generally do not need a work permit to work in Latvia, as they benefit from the freedom of movement within the EU. However, they are required to register with the local Latvian authorities if they plan to work and stay in Latvia for more than three months.
Public Holidays
Latvia Public Holidays
Holiday Name | Date |
New Year’s Day | 1st January |
Restoration of Independence Day | 4th May |
Labor Day | 1st May |
Midsummer Day | 23rd June |
Midsummer Night | 24th June |
Proclamation Day | 18th November |
Christmas Eve | 24th December |
Christmas Day | 25th December |
Boxing Day | 26th December |
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in Latvia is right for you?
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The Benefits
Latvia Employer of Record Benefits
When you choose Agility EOR to expand in Latvia, we guarantee an Employer of Record Service tailored to the needs of your business
Compliance
We are on top of regulatory changes in Latvia so you can relax.
Cost reduction
Allow our economies of scale to work in your favour.
High Service Levels
You and your employees have a dedicated account manager.
Fixed Cost Pricing
We will agree our professional fees up front based on your needs - no nasty surprises!
Consolidated Invoicing & Payments
Make one monthly payment to cover all your tax, social and wages costs from one to one thousand employees.
Fast delivery
You can have 'boots on the ground' within days on our infrastructure.
Reduced Risk
All wage taxes are remitted in full to the Latvian authorities by professionals ensuring liabilities are met, giving you peace of mind.
Supply Chain Transparency
We only pay employees through local full employed solutions meaning Latvia payroll tax is paid on all funds.
Save Time and Money
Our expertise is at your disposal. The need for you to have internal HR, Payroll and admin staff is eliminated.