After Lithuania's parliament on Tuesday improved the new Labour Code to take effect in July, no changes are expected in the sense of flexibility of labour relations, economists say, adding that the initial ambitious plans of liberalizing labour relations has been downgraded into a reflection of the actual situation on the labour market.
Worker
© DELFI / Domantas Pipas

Rokas Grajauskas, senior economist of Danske Bank for the Baltic states, says that the Labor Code will not provide a major solution to the problem of flexibility of labour relations.

"There is more ado and emotions than actual changes. In many aspects, there will be no special flexibility in terms of conditions of dismissal and severance pays, periods of notice from what we have today. In a sense, there will be changes, however, the conditions are rather 'diluted' the initial proposal. There were efforts to secure a compromise between employees and employers, and the result is somewhere in the middle," Grajauskas told BNS.

In his words, the new Labour Code will not lift Lithuania up considerably on global ratings in terms of work flexibility, however, will provide more security and powers to employees.

Gražina Gruzdienė, chairperson of the Trade Union of the Lithuanian Food Industry and member of the Trilateral Council, said the new Labour Code was more favorable to employers than it was until its postponement at the end of last year.

"The Labor Code has become more social over the past six months. We are happy that we managed to organize the part of the work hours, as this had been made totally liberal," Gruzdienė told BNS.

Rūta Skyrienė, executive director of the Investors' Forum, an association of foreign investors in Lithuania, says that adoption of the new Labour Code sent a positive message to foreign investors, however, the reality is that the new labor relations are not very liberal.

In her words, the decision to pay for non-competition, while the person is still employed, is unfair as having the potential to transform into blackmailing.

"I strongly dislike the agreement on non-competition, which envisages a possibility for non-competition remuneration to employees during the time of employment when he works at a company. So I come to my employer and say I will head another association, if you don't pay me extra for not taking the post," Skyrienė told BNS.

She assured that the new Labour Code envisages flexibility in terms of work time regulation, calculation of holidays on work days and shorter dismissal periods, "however, not to the extent where we could say we have become a highly flexible country."

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