The company Sorainen reports that the Ministry of Welfare of Latvia recently published the first publicly available version of the draft law "Law on Pay Transparency." The draft law introduces the requirements of the European Union directive on pay transparency in Latvia. Some of its provisions raise questions.
According to Sorainen, all employers will be required to provide information about payment criteria and its development. The directive allowed for an exception and permitted not to provide such information if the number of employees does not exceed 50; however, in Latvia, the exception is made only regarding information related to the development of payment.
There may also be changes regarding the mandatory content of job advertisements, which will apply to all employers. Currently, the draft law indirectly stipulates that the advertisement must specify not only the amount of the base salary but also allowances, bonuses, and other elements of remuneration provided by the employer.
The procedure for informing government institutions about pay differences will be established by separate rules of the Cabinet of Ministers. A significant administrative fine of up to 14,000 euros is currently provided for violations of this requirement.
Administrative liability may also be established for failing to provide information to employees, not ensuring equal pay, and refusing to conduct joint pay assessments. Sanctions may accumulate gradually and ultimately reach a significant amount.
The main requirement of the draft law remains unchanged: employers must determine the value of work based on the criteria of "skills," "efforts," "responsibility," and "working conditions." The remuneration of the employee should be based on this assessment. The requirements of the directive must be implemented by June 7, 2026.
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