Employer of Record in Latvia: what one employee really costs

Questions people ask before booking a demo

How much does an employer of record cost in Latvia?

The statutory employer charge is a single mandatory social insurance contribution of 23.59% of gross pay, part of a 34.09% total split with the employee's 10.50%. On a US$38,000 salary that is about US$747 a month on top of pay. Published EOR fees then run from about $199 to $699 per employee per month, so the all-in cost lands near $4,110 to $4,610 a month, and the statutory side, about US$747 a month, is larger than even the top of that fee range.

Why is Latvia's employer cost 23.59% when Lithuania's is 1.77%?

Because Latvia never made the transfer its neighbour made. In 2019 Lithuania moved almost the whole social insurance burden onto the employee and required gross salaries to be re-indexed by 1.289 to compensate; Latvia kept the conventional split, so its employer still carries 23.59 of the 34.09 points. Two consequences follow. A Latvian gross salary is built on a smaller base than a Lithuanian one for the same take-home pay, and comparing the two headline employer rates on the same nominal salary exaggerates the gap. Compare total cost of employment instead.

Does the Latvian contribution ceiling reduce the cost of a senior hire?

No, and this is the detail most comparison pages miss. The contribution base is capped at EUR 105,300 a year for 2026, but the State Revenue Service states that the base above the ceiling becomes the object of the solidarity tax and that the contributions paid on it are redirected to that tax. The employer keeps paying at the same headline percentage; only the destination of the money changes. That is why this page applies 23.59% flat instead of capping the line, and why a Latvian employer cost does not fade as pay rises the way Germany's or Japan's does.

What else does a Latvian employer owe beyond the 23.59%?

One small thing and one conditional thing. The business risk state fee is a flat monthly amount per employee that funds the insolvency guarantee; Cabinet of Ministers Regulation No. 651 sets it at EUR 0.36 a month for 2026, which is about 0.013% of this salary and is carried at zero here. Separately, contributions are owed on a minimum object of EUR 2,340 a quarter - EUR 780 a month in 2026 - whatever was actually paid, so a part-time Latvian hire costs more than its salary implies. Neither changes the figure on this page for a full-time professional role.

What leave, probation and notice apply in Latvia?

Article 149(1) of the Labour Law sets annual paid leave at not less than four calendar weeks excluding public holidays, which is twenty working days on a five-day week, and a full month for employees under eighteen. The holidays law names fifteen recurring public holiday days, among them 23 and 24 June for Ligo and Jani and three separate days at Christmas, and provides that when 4 May or 18 November falls on a Saturday or Sunday the next working day becomes a day off. Probation runs to at most three months under article 46(2), extendable to six only by a collective agreement concluded with a trade union. Employer notice is one month for the ordinary grounds.