Lost employer is not an obstacle to terminate the employment contract

Lost employer is not an obstacle to terminate the employment contract

VDI and its territorial units register employee complaints every year about employers who no longer provide work, no longer operate, do not pay wages, and cannot be contacted. In such cases, officially unterminated employment relationships may prevent the employee from getting a job elsewhere or properly exercising other rights related to employment relationships.

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“The disappearance of the employer does not mean that the employee has unlimited time to wait or remains stuck in unended employment relationships,” says Ieva Piličiauskaitė-Dulkė, Head of the Labor Law Department and Chief Labor Inspector. “The procedure provided for in the laws allows VDI to establish the termination of the employment contract when, after an investigation, it is not possible to determine the whereabouts of the employer or their representatives.”

How to apply to VDI?

An employee who wants to terminate an employment contract with an employer whose whereabouts are unknown must submit a written request to VDI for the termination of the employment contract using the sample request form No. 23.

The request can be submitted by mail, courier, in person at VDI, or electronically. Requests submitted electronically must be confirmed by an electronic signature.

Upon receiving the request, a VDI inspector initiates an investigation aimed at determining the whereabouts of the employer or the person representing the employer. Information about the initiated investigation is published in the “Information about the initiated investigation to determine the employer’s location” section on the VDI website.

If, after 10 working days from the date of receipt of the request, it is not possible to determine the whereabouts of the employer or their representative, the next working day the VDI inspector issues the employee a certificate in the prescribed form stating the termination of the employment contract. The employment contract is considered terminated from the date of issuance of this certificate.

The certificate may be issued sooner than within 10 working days if VDI has already conducted an investigation and established that it is impossible to determine the whereabouts of the employer, if the employer is a natural person, or the employer’s representatives, and no more than 3 months have passed since the previous investigation.

The VDI inspector informs the State Social Insurance Fund Board under the Ministry of Social Security and Labor within two working days from the issuance of the certificate.

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It is first recommended to try to contact the employer

VDI points out that starting an investigation does not always confirm that the employer has actually disappeared. Sometimes it turns out that the employer has changed contact details, and the employee does not have them or tried to contact outdated contacts.

If VDI inspectors manage to contact the employer, the employment relationship between the employee and the employer remains valid. In such a case, the employment contract may be terminated on the general grounds established in the Labor Code – by mutual agreement, at the employee’s initiative, or in other cases provided by law.

“When it is still possible to contact the employer, it is first worth trying to agree on the termination of the employment contract in the usual manner established by the Labor Code. This may be more favorable for the employee because when VDI establishes the termination of the employment contract, the right to severance pay does not arise,” emphasizes I. Piličiauskaitė-Dulkė.

Thus, the establishment of the termination of the employment contract by VDI certificate should be considered an extreme measure. It is applied only when it is truly impossible to determine the whereabouts of the employer or their representatives.

Regarding unpaid wages – to the labor dispute commission

The VDI certificate confirms the termination of the employment contract but does not by itself resolve issues regarding amounts unpaid to the employee. To claim unpaid wages and other payments related to employment legal relations, employees have the right to apply to the labor dispute commission operating under VDI.

It is possible to apply to the labor dispute commission regardless of whether the employee has already applied to VDI for the termination of the employment contract or has not yet submitted such a request.

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