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Continuing the series of articles on the information to be included in the employment contract, this time we will look at the information that must be included in the employment contract, as well as the information that can be included on an optional basis, i.e. based on an agreement of the parties.

The Labour Law (LL) stipulates that employment contract shall include information on the agreed daily or weekly working time.

Working time

Working time means the period from the beginning until the end of the work within the scope of which the employee performs work or is at the disposal of the employer, with the exception of work breaks (Article 130 of the LL). The employee’s regular daily working time may not exceed eight hours, and the regular weekly working time may not exceed 40 hours, as provided for in Article 131 of the LL. A specified regulation is established for employees whose work involves a special risk, as well as for employees under 18 years of age.

Therefore, if the employee is employed during regular working time, the employment contract must include a reference to an eight-hour working day or a 40-hour working week. An indication of the weekly working time is recommended, for example, if the employer’s coordination of work or the specific nature of the employee’s work duties provides that the working day may be longer than eight hours on any day of the week (e.g. longer visitor hours on a certain day of the week). However, in such a case, it must be borne in mind that the LL limits the extension of the regular daily working time, i.e. it may be extended by a maximum of one hour (Article 131 of the LL).

In the case of part-time work, the contract shall specify daily or weekly working time, that is shorter than the regular working time.

The information on daily or weekly working time in the employment contract may be substituted by a reference to the respective provisions in laws and regulations, in the collective agreement or by a reference to working procedure regulations (Article 40 of the LL). However, when including a reference to Article 131 (1) of the LL (regular working time) in the employment contract, it must be borne in mind that the provision specifies both daily and weekly working hours. Consequently, the employer must comply with both conditions when employing an employee [1].

According to the LL, the beginning and the end of working time shall be specified. It may be included in the employment contract or regulated by the working procedure regulations or shift schedules (Article 130 (2) of the LL).

Period of leave

In addition to the above, the employment contract shall also specify the length of the annual paid leave, which may not be less than four calendar weeks, not counting public holidays. For employees under 18 years of age, annual paid leave shall be granted for one month.

Taking into account the provisions of the LL, it can be concluded that the contract may also define a longer period of leave, for example, five calendar weeks. A similar view was expressed by the authors of LL’s commentaries [2], emphasizing that if an employee is granted a longer period of annual paid leave, not only it does not erode the employee’s status, but it ensures better conditions for him, therefore, it is valid.

At the same time, it should be noted that if the employer has decided to provide for a longer annual paid leave than set in the law, such rights must be guaranteed to all employed persons.

The duration of annual paid leave may be left out of the employment contract if the contract includes a reference to the provisions regulating the length of the leave in laws and regulations, a collective agreement or the working procedure regulations.

Time period for giving a Notice

The employment contract shall specify the time period for giving a notice of termination of the employment contract. The LL provides for notice periods for both the employee and the employer. The time period for an employee to give a written notice is generally one month, while for the employer it depends on the ground for notice, i.e. there are situations where the employer can terminate the contract without delay, but there are also cases where the period is 10 days or one month. Thus, the notice period specified in the LL may be listed in the employment contract.

The parties may also agree on different terms in the employment contract, but in such a case the principle set out in Article 6 of the LL, which does not permit provisions that erode the legal status of the employee, must be taken into account. Namely, in order not to erode the status of the employee, in case of notice of termination by the employee, the parties may agree in the contract on a shorter time period for notice than one month. On the other hand, in case of notice of termination by the employer, the parties can only agree on a longer term than provided by law. The possibility of such agreement follows from Articles 100 and 103 of the LL.

In its judgment of 29 October 2008 in case SKC-375, the Senate also indicated that the law prescribes the minimum terms that an employer must observe when terminating an employee’s employment contract. Notice periods that are longer than required by law are considered more favorable to the employee.

In addition, the information on the period of notice in the employment contract may be replaced by a reference to the relevant provisions contained in laws and regulations or the collective agreement, or by a reference to the working procedure regulations. For example, an employment contract may include the following provision: “The time period for notice of termination of an employment contract shall be determined in accordance with the Labour Law.”

Collective agreement and working procedure regulations

The employment contract shall also include a reference to the collective agreement and the working procedure regulations applicable to the employment relationship.

Pursuant to Article 21 of the LL, the collective agreement shall be proposed by the employer or the organization, the representatives of employees or the associations (unions). In the absence of such a proposal, the collective agreement procedure cannot be initiated, thus, there shall be no collective agreement. In this case, the employment contract does not need to include a reference to the collective agreement.

The circumstances with regard to the working procedure regulations are different. Namely, Article 55 of the LL stipulates the employer has obligation to adopt working procedure regulations if he normally employs no less than 10 employees at an undertaking. Thus, if at least 10 employees are employed, the employer must adopt working procedure regulations and include a reference to them in the employment contract. As a general rule, the employment contract shall include a reference to the wording of the specific working procedure regulations (indicating the date of issue and / or entry into force), as well as a statement by the employee that he became acquainted with the working procedure regulations.

Probationary period

It follows from Article 40 of the LL that, in addition to the information which must be included in the employment contract, the parties shall also include other information if the parties consider it necessary. When entering into an employment contract, the parties may agree that the employee be subjected to a probationary period to assess whether he is suitable for performance of the work entrusted to him (Article 46 of the LL). A probationary period shall not be determined for persons under 18 years of age. According to the LL, the term of a probationary period may not exceed three months, so that the parties may also agree, for example, on a probationary period of two months. In addition, as indicated by the authors of LL’s commentaries [3], it is advisable that the parties specify in the employment contract a specific date, which will be considered as the last day of the probationary period.

As the probationary period can only be set at the time of the conclusion of the employment contract, it should be noted that the employee cannot be subject to a re-probation, for example by initially determining the probationary period for one month and then extending it for another month. Nor can a new probationary period be determined by the transfer of the employee to a different position.

Given that the probationary period can give rise to the possibility for both the employee and the employer to terminate the employment contract at a shorter notice, in practice, employment contracts include provisions on the probationary period and its duration.

Restrictions on Supplementary work

The parties to the employment contract may also agree on restrictions on the employee’s right to perform supplementary work (Article 91 of the LL), i.e. work for another employer. According to the law, an employee is entitled to perform supplementary work, unless otherwise provided in the employment contract.

When imposing restrictions, the employer should take into account that the performance of supplementary work may be restricted if justified by substantiated and protected interests of the employer, especially if such supplementary work may affect proper performance of the employee’s obligations. As types of supplementary work can vary, for example in part-time or in sectors not connected with employer, etc., it is not advisable to include a general restriction on supplementary work in the employment contract. If there are substantiated and protected interests of the employer, it is advisable to provide that the employee is not entitled to perform supplementary work without the prior written consent of the employer. Consequently, in each situation, the employer should assesses the specific factual circumstances in order to ensure both the protection of his interests and avoidance of unjustified restriction of the employee’s rights.

Other agreements

In the employment contract, the employee and the employer may also agree on various provisions arising from the LL, which improve the legal status of the employee. For example, the LL provides an obligation for the employer to disburse the remuneration if employee does not perform work after donating his or her blood or blood components in a medical treatment institution. The parties may agree in the employment contract for more paid rest days than specified in the law (Article 74 (6) of the LL)

Similarly, the parties may also agree on a higher severance pay in the event of termination of the employment contract (Article 112 of the LL), a shorter working time before public holidays (Article 135 of the LL), the inclusion of work breaks in working time, as breaks are generally not included in the working time (Article 145 (2) of the LL), for additional cases where the employee is granted additional annual paid supplementary leave (Article 151 (2) of the LL), etc.

In the employment contract the employer and the employee may also regulate issues that are not specified in detail in the LL, such as the time granted to seek for a new job and the amount of earnings to be retained if the employment contract is terminated (Article 111 of the LL); the length of the working day on Saturdays (Article 133 (3) of the LL), as well as the procedure for early termination of the parental leave (Article 156 (5) of the LL).

With regard to termination of the employment contract, it should be noted that according to Article 112.¹ of the LL, the parties to the employment contract may agree on the possibility to send the notice of termination to the other party by electronic mail, as well as the right to recall the notice of termination (Articles 100 and 103 of the LL).  Namely, it is possible to stipulate that the notice can be sent to the other party by e-mail using a secure electronic signature. In this case, the employment contract shall also specify the e-mail address of the employee and the employer to which the notice must be sent. Similarly, as already mentioned, the contract may provide that both the employer and the employee have the right to recall the notice. Without such a right, the notice may be recalled only with the consent of the other party.

What to do if there are uncertainties or difficulties arising from the employment contract?

If you need help with labour law matters, please contact our lawyer Ilze Jankeviča.

Lawyer Ilze Jankeviča shared her knowledge at the LEADELL Academy. Ilze has in-depth knowledge in the field of labour law and she would be pleased to help you in finding solutions to issues arising from employment relations. In the following articles, we will look at mandatory and optional information that must be included in the employment contract.

Read more LEADELL Academy

[1] K. Platā, Informatīvais materiāls par darba tiesisko attiecību jautājumiem “Par darba līgumiem”, Rīga, 2006.

[2] Autoru kolektīvs I. Liepiņas, K. Rācenāja un N. Preisas zinātniskajā redakcijā, “Darba likums ar komentāriem”, Rīga, 2020.

[3] ZAB “BDO Zelmenis & Liberte”, “Darba likums ar komentāriem”, Rīga, Latvijas Brīvo arodbiedrību savienība, 2010.