US

Apr 25 2019

EU Blue Card Salary Level Increased

Lithuania

At a Glance

Effective immediately, the minimum monthly gross salary for EU Blue Card applicants in Lithuania has increased to EUR 1,876.08, up 33 percent from the last available update. The significant increase is largely due to a major tax overhaul. Employers should budget for the increase when seeking to employ foreign workers under an EU Blue Card.


The situation

Effective immediately, the minimum monthly gross salary for EU Blue Card applicants in Lithuania has increased to EUR 1,876.08, up 33 percent from the last available update.

A closer look

  • Existing employees. Employers of foreign nationals currently under an EU Blue Card must increase the foreign national’s salary to comply with the new rule.
  • Initial and renewal applications. Employers of foreign nationals seeking to obtain or renew an EU Blue Card must increase the foreign national’s salary to comply with the new rule. Immigration applications that do not meet the minimum salary will be refused.
  • Pending applications. Employers of foreign nationals with pending EU Blue Card applications as of February 28, 2019 must increase the foreign national’s salary to comply with the new rule. Immigration applications that do not meet the minimum salary will be refused.

 

Reminders on other requirements

  • Quarterly increases. As a reminder, the EU Blue Card salary threshold is based on the national average monthly wage, which steadily increases every quarter. Employers are advised to regularly check the applicable salary threshold and maintain a safe margin when determining EU Blue Card applicants’ salaries.
  • Benefits and allowances. As before, benefits and allowances cannot be included in the minimum salary calculation.
  • Payment frequency. As before, the salary must be paid at least twice a month, or may be paid monthly at the foreign worker’s written request.
  • Payment details confirmed in writing. As before, the timing, place and procedure of salary payment must be specified in collective agreements or in the employment contract.

 

Background

Although salary thresholds for foreign workers in Lithuania typically increase by five to 10 percent, national average salaries have been rising at a faster pace in line with a growing economy. As a result, the EU Blue Card salary threshold, which is tied to the national average monthly salary which steadily increases every quarter, was already raised by 40 percent last December when compared to the applicable salary threshold in the third quarter of 2018.

The current 33 percent increase reflects a major tax overhaul implemented in January that consolidated employer wage-related taxes into a single amount.

Looking ahead

Fragomen expects salary thresholds in Lithuania to continue rising at accelerated rates, as the salary thresholds under all work authorization types are linked to the national average salary which is increasing at a fast pace.

Additionally, Fragomen expects Lithuanian authorities to continue to streamline the immigration process, as demonstrated by the tax overhaul and upcoming measures that will introduce online filing of immigration applications.

This alert is for informational purposes only. If you have any questions, please contact the global immigration professional with whom you work at Fragomen or send an email to emea@fragomen.com.