--- title: "Hiring in Latvia 2026 | Employer of Record Guide" description: "Hire in Latvia through Teamed's EOR. 23.59% employer social insurance, 4 weeks paid leave, gross minimum wage €780/month. Each guide takes one layer." canonical: https://www.teamed.global/country-hiring-guides/latvia --- Latvia · Country overview Served by Teamed vetted partner-entity network in Latvia # What do you need to know to hire in *Latvia*? Win an unlawful-dismissal case in Latvia and the court can order back pay for the whole stretch the worker was kept out, with no cap on the figure ([Section 126, Labour Law](https://www.lm.gov.lv/en/media/3976/download)). Employer social insurance runs at 23.59%, paid leave starts at 4 weeks, and the gross minimum is €780/month. Each guide below takes one layer. Last reviewed 13 June 2026 · Latvia guide ## How does Teamed handle Latvian hiring for you? Teamed becomes your legal [employer of record](/lp/employer-of-record) in Latvia for [**from $599 per employee per month**](/pricing), with **zero FX mark-up** in any currency. Payroll, contracts, and the full Latvian employment law stack run on **one platform**. **Real HR and legal experts** manage every Latvian hire, from the first offer letter to the final settlement. **An actual person**, not a chatbot or a pooled queue, handles your Latvian team alongside EOR, contractor onboarding, and entity payroll on **one platform**. There is **no setup fee** and **no exit fee**. Employer cost **passes through at cost, itemised** on every invoice. A Latvian contractor who converts to employment keeps their record, and that same employee can **graduate** from EOR to your own Latvian entity without re-onboarding. Run the [Crossover Calculator](https://www.teamed.global/tools/crossover-calculator) to see the month the model flips. EOR is the right model for a first Latvian hire, **until it isn't**. Three things you won't find on any other Latvia EOR guide - **Latvia caps nothing on an unlawful dismissal.** Win reinstatement and the court awards average earnings for the entire period the worker was out, with no statutory ceiling ([Section 126, Labour Law](https://www.lm.gov.lv/en/media/3976/download)). The burden sits on the employer to prove the dismissal was lawful. Most Latvia EOR guides quote a tidy severance band and stop there. [The termination guide](/country-hiring-guides/latvia/termination-and-severance) sets out what that exposure really means. - **Sick pay steps up before the state ever pays.** The employer covers days 2 and 3 at 75% of average earnings, then days 4 to 9 at 80%. Only from day 10 does the State Social Insurance Agency take over at 80%. Many guides skip the two-rate employer window entirely. - **There is no 13th-month salary in Latvian law.** Latvia mandates no annual bonus and no Christmas or holiday subsidy. Any extra month of pay is something you choose to offer, not a payroll line the law forces on you. [The tax and payroll guide](/country-hiring-guides/latvia/tax-and-payroll) shows what the statutory cost actually includes. Answer.cite this Hiring in Latvia adds employer social insurance of 23.59% on top of gross pay. The employee pays a further 10.5% from their own wage. Payroll runs at least twice a month, unless both sides agree on once a month ([Section 69, Labour Law](https://www.lm.gov.lv/en/media/3976/download)). The gross minimum wage is €780/month. Personal income tax is progressive, from 20% up to 31% on the top band. Paid leave is 4 weeks. Workers cannot be made to work on a public holiday, and work that does happen carries a 100% pay supplement ([Section 144, Labour Law](https://www.lm.gov.lv/en/media/3976/download)). Teamed runs Latvian payroll, contracts, and compliance through a vetted local partner entity. This page is the map. Each guide below is the detail. At a glance · Latvia EUR · Latvian · Monthly or twice-monthly payroll Currency EUR (euro) Employer social insurance 23.59% general risk scheme, on gross pay Employee social insurance 10.5% withheld from gross pay Gross minimum wage €780/month full-time, from 1 January 2026 Annual leave 4 weeks 28 calendar days, Labour Law Standard working week 40 hours 8 hours a day, Section 131 Top income tax 31% above EUR 78,100 a year 13th-month salary None in law no mandatory annual bonus ![A warm wide illustration of Riga at golden hour: the spire of St Peter's Church rising over the pastel facades of the Old Town, the Daugava river catching amber light, and red rooftops below a clear sky.](/images/country-guides/latvia-hiring.webp) Latvia · per employee · per month · flat $ 599 Zero FX. No setup fees. Fast onboarding. The price your finance team can forecast against without an asterisk. Zero FX Fixed No setup fee No exit fee Itemised invoice ## How much does it cost to hire an employee in Latvia in 2026? Budget for the gross salary plus employer social insurance of 23.59%. The gross minimum wage is €780/month. The Teamed fee sits inside that total cost, not bolted on outside it. The main employer cost on top of salary is social insurance at 23.59% of gross employment income. The employee then pays 10.5% from their own wage, plus progressive income tax. A small business risk state fee per employee also applies; the cost guide carries the exact figure once it is verified. Teamed's Latvia price is a starting rate, with zero FX in any currency pairing. No setup fees. No exit fees. Salaries, taxes, and benefits passed through at cost on every invoice. The full breakdown, with worked examples at current rates, is in the cost guide. [Read the full Latvia cost breakdown](/country-hiring-guides/latvia/cost-breakdown) ## Do you need a Latvian entity to hire employees in Latvia? No. An Employer of Record runs Latvian payroll and contracts from day one. Your own Latvian entity becomes cheaper than EOR once headcount climbs, depending on salary. Registering a Latvian company means incorporation at the Register of Enterprises, registering as an employer with the State Revenue Service for payroll taxes and social insurance, and setting up ongoing monthly reporting. Setup takes weeks and brings standing filing duties. An [Employer of Record](/lp/employer-of-record) is faster and cheaper at low headcount. Teamed runs Latvian payroll, contracts, and compliance from day one through a vetted local partner entity. The crossover point depends on Latvian salary levels and your local accounting costs. The EOR vs entity guide runs those numbers for your headcount. Most providers will not tell you when you have crossed it. We do, and we help you move. You progress from contractor to EOR to your own Latvian entity on **one platform** under Teamed's Graduation Model, with tenure preserved. [Read the full Latvia EOR vs entity guide](/country-hiring-guides/latvia/eor-vs-entity) ## What changed in Latvian employment law recently? The gross minimum wage rose to €780/month from 1 January 2026. It stood at EUR 700 in 2024 and EUR 620 in 2023, so the floor has moved fast. The Cabinet raised the minimum monthly wage to €780/month, in force from 1 January 2026, up from EUR 700 the year before. The monthly basic non-taxable minimum for income tax is €550/month in 2026. Personal income tax stays progressive across three bands, from 20% to 31%. Sick pay rules also bite earlier than most employers expect. The employer pays days 2 and 3 at 75% of average earnings, then days 4 to 9 at 80%, before the state takes over from day 10. The hiring and tax guides cover each current rule in detail. [Read the full Latvia hiring guide](/country-hiring-guides/latvia/hiring-guide) ## What benefits must you provide Latvian employees in 2026? The floor is 4 weeks of paid annual leave, which is 28 calendar days. Workers cannot be required to work on a public holiday, and holiday work carries a 100% pay supplement. Statutory paid annual leave is 4 weeks, set as 28 calendar days under the Labour Law. The standard working week is 40 hours, at 8 hours a day, with at least 12 hours of rest between working days. Overtime is capped at 200 hours a year and pays a 100% supplement. Employees are not required to work on public holidays prescribed by law ([Section 144, Labour Law](https://www.lm.gov.lv/en/media/3976/download)); work that is needed carries a 100% supplement. Sick pay starts with the employer at 75% for days 2 and 3, then 80% for days 4 to 9. State sickness benefit then runs at 80% from day 10, for up to 26 weeks. The benefits guide covers each entitlement in full. Read the full Latvia benefits guide ## What are payroll taxes in Latvia in 2026? Employer social insurance is 23.59% of gross pay. Employees pay 10.5% social insurance plus progressive income tax, from 20% up to 31%. The employer pays social insurance at 23.59% of gross employment income under the general risk scheme. The employee's own share is 10.5%. Income tax is progressive: 20% on annual income up to EUR 20,004, 23% on the band to EUR 78,100, and 31% above that. A monthly basic non-taxable minimum of €550/month reduces the taxable amount. Pay must be disbursed at least twice a month, or once a month by agreement, and every payslip must itemise the pay, the taxes deducted, and the social insurance paid ([Sections 69 and 71, Labour Law](https://www.lm.gov.lv/en/media/3976/download)). Teamed handles every deduction and remits to the State Revenue Service. The tax and payroll guide sets out each band and threshold. [Read the full Latvia tax and payroll guide](/country-hiring-guides/latvia/tax-and-payroll) ## How do you terminate an employee in Latvia? The employer must prove a dismissal was lawful, or it does not stand ([Section 125, Labour Law](https://www.lm.gov.lv/en/media/3976/download)). Get it wrong and the court can order back pay for the whole period the worker was out, with no cap on the figure. Latvian dismissal law puts the burden on the employer. Section 125 of the Labour Law says the employer has to prove a notice of termination had a legal basis and followed the right process. If it cannot, the dismissal is invalid. A reinstated worker is then owed average earnings for the whole period of forced absence from work, with no statutory cap ([Section 126, Labour Law](https://www.lm.gov.lv/en/media/3976/download)). The same remedy applies if the court ends the relationship at the worker's request instead of reinstating them. Notice periods and severance scale with length of service, and sources differ on the exact bands, so the termination guide sets them out against the current statute rather than a rough table. The headline that matters for budgeting is the uncapped forced-absence remedy, not a fixed severance ceiling. The termination guide runs the full process. [Read the full Latvia termination and severance guide](/country-hiring-guides/latvia/termination-and-severance) ## What should you know before hiring in Latvia? Two things catch US buyers out. The first is that an unlawful dismissal has no compensation cap. The second is that the employer pays the first stretch of sick pay before the state ever does. **Unlawful dismissal exposure is open-ended.** There is no fixed compensation scale in the Labour Law. A worker who wins reinstatement is owed average earnings for the entire period of forced absence, however long the case runs ([Section 126, Labour Law](https://www.lm.gov.lv/en/media/3976/download)). The employer carries the burden of proof. Run a clean, documented process from the start. **Sick pay lands on the employer first.** The state does not pay until day 10. Before that the employer covers days 2 and 3 at 75% of average earnings, then days 4 to 9 at 80%. There is also no 13th-month salary in law, so any annual bonus is your choice to make. The hiring guide and the termination guide both cover safe process in detail. [Read the full Latvia hiring guide](/country-hiring-guides/latvia/hiring-guide) ## Frequently asked questions How much does it cost to hire an employee in Latvia? Budget for the gross salary plus employer social insurance at 23.59% of gross pay. The employee pays a further 10.5% from their own wage. The gross minimum wage is €780/month. Teamed's Latvia fee is one flat number per employee per month, with zero FX mark-up in any currency pairing. The cost breakdown guide has worked examples. Can a US company hire in Latvia without an entity? Yes. An Employer of Record like Teamed runs Latvian payroll, contracts, and compliance through a vetted local partner entity. You direct the work. Teamed becomes the legal employer of record. Registering your own Latvian company takes weeks and means employer registration with the State Revenue Service plus ongoing monthly filings. What are the payroll taxes in Latvia in 2026? Employer social insurance is 23.59% of gross pay and the employee pays 10.5%. Personal income tax is progressive, from 20% on lower income, 23% on the middle band, up to 31% above EUR 78,100 a year. A monthly basic non-taxable minimum of €550/month reduces the taxable amount. What is statutory annual leave in Latvia? The minimum is 4 weeks of paid annual leave, set as 28 calendar days under the Labour Law. The standard working week is 40 hours, at 8 hours a day. Employees cannot be required to work on a public holiday prescribed by law, and any holiday work carries a 100% pay supplement. How does sick pay work in Latvia? The employer pays first. Days 2 and 3 of illness are covered at 75% of average earnings, then days 4 to 9 at 80%. From day 10 the State Social Insurance Agency pays state sickness benefit at 80% of the average insurance contribution wage, for up to 26 weeks of continuous incapacity. Is there a 13th-month salary in Latvia? No. Latvian law does not require a 13th- or 14th-month salary, a Christmas subsidy, or any compulsory annual bonus. Any such payment is discretionary and set by contract, not by statute. Pay must be disbursed at least twice a month, unless the employee and employer agree to once a month. Teamed Legal Operations Latvia reads like a calm Baltic labour market until you test a dismissal. The Labour Law puts the burden of proof on the employer, and a worker who wins reinstatement is owed average earnings for the whole period they were kept out, with no cap. New employers price the severance band and forget the bigger number. The exposure is not the formula. It is the open-ended remedy when the process was thin. A note from Tom Price-Daniel Latvia's unlawful-dismissal remedy has no ceiling: average earnings for the whole period a worker was wrongly kept out. Most of the cost surprises come from pricing the severance band and ignoring that. Read the right Latvia guide before the first hire, not after the first claim. Tom Price-Daniel · Co-founder, Teamed ## Keep reading - [Latvia hiring guide, offer to payslip](/country-hiring-guides/latvia/hiring-guide)guide - [Latvia employer cost breakdown 2026](/country-hiring-guides/latvia/cost-breakdown)guide - [EOR vs entity in Latvia](/country-hiring-guides/latvia/eor-vs-entity)guide - [Latvia termination and severance](/country-hiring-guides/latvia/termination-and-severance)guide - [Latvia tax and payroll](/country-hiring-guides/latvia/tax-and-payroll)guide - [Employer of Record overview](/lp/employer-of-record)core - The Graduation Modelcore - [Teamed pricing, Zero FX Fixed](/pricing)core - [Crossover Calculator](https://www.teamed.global/tools/crossover-calculator/latvia)tool - [Talk to an expert](https://www.teamed.global/contact)CTA A note on this page. This is a guide, not legal, tax or accounting advice. Rules change and vary by jurisdiction. Verify current requirements with the State Revenue Service (VID), the Ministry of Welfare, the State Labour Inspectorate (VDI), and the State Social Insurance Agency (VSAA) for Latvia, or speak to a qualified professional, before relying on any specific framework.