Changing the workplace and place as the terms of the employment contract

On 16 June 2021, the Supreme Court of Lithuania (SCL) examined a civil case that raised the issue of changing the workplace and place as the terms of the employment contract and the necessity to justify changing of the terms of employment.

Change to the terms of employment

Two procedures for changing the terms of employment at the initiative of the employer are provided in the Labour Code of the Republic of Lithuania (LC):

a part of the terms of employment may be changed only with the written consent of the employee;
written consent of the employee is not required for changes in other parts of the terms of employment.

The following terms of employment may be changed with the written consent of the employee:

indispensable employment contract terms (job function, workplace, payment for work);
supplementary employment contract terms, type of working-time arrangements;
a place for the performance of job function(s).

Any other changes to the terms of employment not mentioned above do not require the employee’s written consent. Such terms may be changed by a decision of the employer due to the changes in the rules governing the terms of employment or in cases of economic, organizational, or industrial necessity.

“Workplace” and “place”

In the case examined by the SCL, the parties raised the issue of the concepts “workplace” and “place”, as the employee argued that her written consent was not necessary when changing the workplace. Therefore, the SCL explained the essence of the above concepts:

“Workplace” is a structural organizational entity that independently carries out the field(s) of activity chosen by the employer, and its manager has the autonomy to solve all or part of the issues falling within the employer’s competence and to provide instructions to the employees of that organizational entity. Thus, the main characteristics of the workplace are:

its organisational autonomy; and
direct subordination of employees to the procedures applicable at the workplace.

“Place” is usually associated with a specific administrative-territorial unit or a part thereof of a country (except in the cases of mobile work, where the functions are performed throughout the country or outside it). Whereas the “place for performance of job functions” (place of work) may be non-permanent depending on the nature of the work and the organisation of the work and may vary within the same area within a certain period of time. Thus, the concept “place” is more general and the concepts “place of work” and “place for performance of job functions” are narrower and are related to the address at which, in performance of the instructions of the workplace, the employee carries out his/her duties of performs functions during a specific period (day, week, month, etc.).

The Court of Cassation noted that a prior written consent of the employee must be obtained in relation to the change in the above terms of employment (workplace, place).

The need to justify the reasons for changing the terms of employment

When deciding on the reasons for changing the terms of employment, the Court of Cassation stated that changing of these terms could not be an end in itself, that the employer must justify the change in any term of employment, whether those changes require the employee’s consent or those for which such consent is not required, i.e., give reasons why they must be substantially changed.

In order to change the terms of employment for economic, organisational or industrial reasons, the following conditions must exist:

1) the reasons are real, i.e. based on the needs of the employer and/or the objectives of their activities, and the restructuring must be carried out;

2) the reasons are specific, i.e. it is not enough to declare the nature of the cause (economic or other), and the content of the reason must be disclosed in each specific case;

3) there is a need to change the terms of employment, i.e. without changing the terms of employment, it is not possible to meet the needs of the employer and / or achieve their goals;

4) existence of the reasons must be proved by the employer;

5) in cases when the terms for which the employee’s consent is required are changed, those reasons must be significant.

Thus, before changing the terms of employment, the employer must assess whether the employee’s consent is mandatory or whether it is sufficient just to inform the employee, the employer must also justify the changes to the terms of employment on the grounds of economic, organisational and industrial necessity, and, when changing the terms of employment for which the prior written consent of the employee must be obtained, further justify the significance of these reasons.

For more information or advice on the issues of labour law, please contact the team of ECOVIS ProventusLaw.

Prepared by Brigida Bacienė, the Head of Employment Practice, and Lina Bulovienė, the Assistant Attorney at Law