Labour dispute over €10,070 in daily allowances ended with a settlement agreement for €5,000
The employee claimed €10,070 in daily allowances. The parties agreed on a payment of €5,000, and the Commission approved the agreement and closed the case.
What happened in the case
In an amended application, the employee claimed €10,070 in daily allowances. At the hearing, the parties agreed to settle and concluded a written settlement agreement, which they then submitted to the Commission for approval.
The Commission found that
The parties were entitled to end the dispute by settlement
Under the Labour Code, the Commission closes the proceedings by a decision if the parties have concluded a written settlement agreement.
The agreement does not contradict mandatory rules
The Commission found no grounds to refuse to approve the agreement, because the parties’ intention is clear and its terms do not contradict mandatory provisions of law or the public interest.
The Commission decided
The Commission approved the settlement agreement and closed the labour case. Under the agreement, the defendant undertook to pay the claimant €5,000 within 3 business days of signing the agreement, and the claimant waives all claims arising from the employment relationship that existed until 22 June 2026 and its termination. Clause 3 of the agreement provides that missing the payment deadline entitles the claimant to renew the claim.
Want to end a labour dispute amicably?
In this case, the settlement agreement stated the amount of the payment, the payment deadline counted from signing, the claims being waived, and that the payment is not an admission of the claims. The clause on the consequences of missing the deadline should be worded precisely. If you are considering settling a labour dispute, send us the application, the response and the proposed draft agreement. We will review the terms before they are submitted to the Commission.
Unofficial translation of the anonymised decision of the CommissionVilnius Labour Disputes Commission · 21 September 2026
This is an unofficial translation of the decision of the Lithuanian labour disputes commission, provided for information only. The Lithuanian original is authoritative. Read the original (Lithuanian)
Labour case No. [anonymised]
OF THE STATE LABOUR INSPECTORATE OF THE REPUBLIC OF LITHUANIA
UNDER THE MINISTRY OF SOCIAL SECURITY AND LABOUR
VILNIUS LABOUR DISPUTES COMMISSION
DECISION
21 September 2026 No. [anonymised]
Vilnius
The Vilnius Labour Disputes Commission of the State Labour Inspectorate of the Republic of Lithuania, composed of the chairwoman [anonymised] and members [anonymised], having examined in writing the labour case on the application of the claimant [anonymised] against the defendant [anonymised] for the recovery of wages and other related payments,
has found:
on 7 August 2026 the claimant submitted an application for the examination of an individual labour dispute on a matter of right. On 10 September 2026 he submitted an amended application and asks for the award of €10,070 in daily allowances.
At the hearing on 15 September 2026, the parties reached an acceptable agreement, concluded a written settlement agreement and on 21 September 2026 submitted it to the Labour Disputes Commission for approval.
The labour case is to be closed.
Pursuant to Article 224(3)(2) of the Labour Code of the Republic of Lithuania, the Labour Disputes Commission closes the proceedings by a decision if the parties have concluded a written settlement agreement resolving the labour dispute.
In the present case, the parties exercised the right granted by law to end the case by a settlement agreement on mutually acceptable terms. The Labour Disputes Commission has no grounds to refuse to approve the settlement agreement signed by the parties, because the parties’ intention to do so is expressed and clear, and its terms do not contradict mandatory provisions of law or the public interest.
The settlement agreement concluded by the parties to the dispute is to be approved, and the labour case is to be closed.
The Labour Disputes Commission, guided by Article 216(1)(1), Article 224(3)(2) and Article 228(2) of the Labour Code of the Republic of Lithuania,
has decided:
to approve the settlement agreement concluded by the parties, the claimant [anonymised] and the defendant [anonymised], represented by [anonymised], the text of which is as follows:
“SETTLEMENT AGREEMENT
[anonymised], personal identification number [anonymised], residential address [anonymised], email [anonymised], tel. [anonymised], hereinafter the Claimant
and
[anonymised], legal entity code [anonymised], address [anonymised], email [anonymised], tel. [anonymised], hereinafter the Defendant,
hereinafter together the Parties,
seeking to resolve amicably their mutual disagreements relating to the application filed by the Claimant in labour case No. [anonymised] for the recovery of payments related to the employment relationship, have concluded this settlement agreement (hereinafter the Settlement Agreement) and agreed on the following terms of the Settlement Agreement:
1. The Parties declare that by this Settlement Agreement they finally resolve the labour dispute concerning the Claimant’s claims relating to the Claimant’s employment relationship at the company [anonymised] and its termination. The Claimant finally and unconditionally waives all claims submitted and later amended in labour case No. [anonymised], including claims for wages, daily allowances, business trip expenses, holiday pay, compensation for unused annual leave, penalties, interest, pecuniary and non-pecuniary damage and other payments arising from the employment relationship that existed between the Parties until 22 June 2026 and its termination.
2. In pursuit of a mutual compromise, the Parties agree that the Defendant shall, within 3 (three) business days of the date of signing this Settlement Agreement, pay the Claimant the sum of €5,000.00 (five thousand euros) by transferring it to the Claimant’s bank account into which his wages were paid.
3. Once the Labour Disputes Commission approves this Settlement Agreement, all of the Claimant’s claims arising from the employment relationship that existed between the Parties until 22 June 2026 and its termination shall be deemed finally resolved and replaced by the Defendant’s sole obligation to pay the amount set out in clause 2 of the Settlement Agreement. Any failure to perform this obligation within the period of 3 (three) business days entitles the Claimant to renew the claim submitted in the labour case or to bring it again.
4. The conclusion of this Settlement Agreement and the payment of the amount set out in it are not, and cannot be construed as, an admission by the Defendant that the claims made in the Claimant’s labour case or the calculations he submitted are wholly or partly well founded. The Settlement Agreement is concluded solely on the basis of a mutual compromise, in order to finally end the dispute and avoid additional time and financial costs.
5. The Parties confirm that they conclude the Settlement Agreement of their own free will, have read its text, understood all of its terms and their legal consequences, and that the Settlement Agreement therefore reflects the true intention of the Parties.
6. The Parties know and understand the legal consequences of the approval of the Settlement Agreement and of the closure of the labour case. The Parties understand that the terms of the Settlement Agreement approved by a decision of the Labour Disputes Commission are binding and enforceable in accordance with the procedure laid down by law.
7. Once the Labour Disputes Commission approves this Settlement Agreement, the Parties shall have no further claims against each other relating to the employment relationship that existed between them until 22 June 2026 and its termination, except for the Defendant’s obligation to perform the payment obligation set out in clause 2 of the Settlement Agreement.
8. The Parties ask the Vilnius II Labour Disputes Commission to approve this settlement agreement and to close labour case No. [anonymised].”
To close the labour case.
If a party to a labour dispute disagrees with the decision of the Labour Disputes Commission, that party has the right, within one month of the date on which the Commission’s decision was adopted, to bring a claim before a court for the examination of the labour dispute on a matter of right, in accordance with the provisions of the Code of Civil Procedure of the Republic of Lithuania (Article 231(1) of the Labour Code of the Republic of Lithuania). The claim is submitted to the District Court. More information: www.teismai.lt.
The decision of the Labour Disputes Commission is an enforceable document (Article 230(2) of the Labour Code), enforced in accordance with the procedure laid down by the Code of Civil Procedure. If the terms of a settlement agreement approved by a decision of the Labour Disputes Commission are not performed, the Commission’s decision is enforced by compulsion.
Chairwoman of the Commission [anonymised]
