It is necessary to reduce the overtime pay supplement across all economic sectors, setting it at 50% instead of double pay as it currently stands. However, if there is a collective agreement in the sector, the overtime pay supplement should be up to 20%. This proposal was presented by the Foreign Investors’ Council in Latvia (FICIL) at the Human Capital Development Council meeting on Thursday, October 24.

According to the Employers’ Confederation of Latvia (LDDK), Latvia is currently the only country in Europe where overtime is paid at a 100% rate.

FICIL believes that the existing regulation in sectors where there are general agreements often does not work in practice, and these changes could reduce the shadow economy, for example, in the construction sector. During the meeting, FICIL presented 12 proposals for amendments to the Labor Law, which are planned to be discussed in the coming months.

In light of the intense discussions that arose during the meeting, Minister of Economics Viktors Valainis called on all parties involved to provide a specific assessment of each FICIL proposal for the next meeting. Additionally, a broader collection of information on how labor law practices are handled in other countries is required. "The international aspect is still greatly missing," said V. Valainis.

FICIL also proposes withholding part of the final salary in cases where an employee, upon ending employment, has not returned company equipment or other items.

The Human Capital Development Council is known to be a collegial body consisting of three ministers — for the economy, education and science, and welfare. It was established to implement coordinated interdepartmental cooperation and make decisions on planning, developing, implementing, and monitoring necessary labor market adjustments to foster human resource development in line with future labor market demands and structural changes in the economy aimed at creating higher added value to benefit society as a whole. The council is chaired by the Minister of Economics. To improve the management of human capital development issues and promote dialogue between all parties involved in addressing these issues, amendments to the regulations of the Human Capital Development Council were approved at the Cabinet of Ministers meeting on August 20, following the Ministry of Economics' initiative. The amendments stipulate that, in the future, representatives from Latvia's largest and most influential business and trade union organizations will also participate in the Council's work in an advisory capacity, including the Free Trade Union Confederation of Latvia, the Foreign Investors' Council in Latvia, the Employers’ Confederation of Latvia, the Latvian Exporters Association "The Red Jackets," and the Latvian Chamber of Commerce and Industry.

Information from the Ministry of Economics of the Republic of Latvia.