PEO Services in Latvia

A co-employment model for companies that want to share the employer relationship in Latvia rather than hand it over entirely. Worth knowing up front: genuine PEO co-employment is less commonly used in Latvia than a straight EOR or payroll arrangement, so we will tell you honestly whether PEO or an EOR genuinely fits, and place you with the right vetted partner.

  • Independent advice
  • Vetted partners
  • Honest positioning

What a PEO does in Latvia

A Professional Employer Organisation works on a co-employment model. You and the PEO partner share the legal employer responsibilities for your Latvian staff: you keep direction and day-to-day control, while the partner administers payroll, income tax, and the VSAOI social insurance contribution under a shared arrangement.

01

Shared employer role

You and the PEO partner share the legal employer responsibilities. You keep direction and control; they handle payroll, income tax, and the VSAOI social insurance contribution.

02

More direct control

PEO suits companies that want to retain more direct control of the employment relationship than a full EOR arrangement allows. In Latvia, EOR or managed payroll is the more established route, so we confirm PEO genuinely fits before recommending it.

03

Honest recommendation

For most companies hiring in Latvia, EOR is simpler. We will tell you honestly whether PEO genuinely fits your structure, or whether EOR serves you better.

How PEO works in Latvia, step by step

From assessing the fit to a compliant co-employment arrangement.

01 — Assess the fit

We map your structure, headcount, and how much control you want to keep, and tell you honestly whether PEO or EOR serves you better. No product push.

02 — Set up co-employment

If PEO fits, we place you with a vetted Latvian partner and structure the shared employer arrangement correctly.

03 — Onboard your people

Compliant Latvian employment terms under the Darba likums, with the administrative employer functions handled by the partner.

04 — Payroll & compliance

Income tax, the VSAOI contribution, and statutory filings handled monthly, while you keep day-to-day direction.

What PEO in Latvia costs

As with EOR, two parts: the statutory cost of employment (one clean rate in Latvia, not several schemes to add up) and the partner service fee.

Employer social insurance

23.59% of gross salary, the full employer share of the VSAOI mandatory state social insurance contribution, administered under the shared employer arrangement.

Minimum wage (2026)

EUR 780 per month gross for full-time work, roughly EUR 4.50 per hour, in force since 1 January 2026 with no regional rate to track separately.

Income tax (employee)

25.5% up to EUR 105,300 of annual income and 33% above it, plus a 3% solidarity surcharge above EUR 200,000, withheld at source as part of the shared payroll administration.

PEO partner fee

A service fee for the co-employment administration. Under a shared employer arrangement, Latvia’s VSAOI contribution and the current income-tax bands still have to be administered correctly by someone. We benchmark across our vetted network, typically 15 to 25% below going direct.

Why arrange it through Bradford Jacobs

Why companies arrange Latvian PEO through us rather than going direct to a single provider.

We tell you if PEO fits your needs

We are independent: we assess what you actually need, place you with the right vetted partner, secure pricing you will not get going direct, and stay on your side to escalate or renegotiate. You get advice, not a product pitch.

  • Independent advice
  • Vetted partners only
  • On your side at renewal

Pricing you can’t get direct

Latvia’s employer cost is one clean VSAOI rate, which makes a co-employment service fee easy to compare on paper and easy to under-quote in practice once the corporate-tax timing and the income-tax reform’s bands are factored in properly. We benchmark across our vetted network for rates typically 15 to 25% below going direct, and renegotiate for you at renewal.

  • 15-25% below direct
  • Network benchmarking
  • Renegotiated for you

Straight to the top when it matters

When something needs resolving, and in global employment it sometimes does, you come to us. We escalate directly, past the helpdesk, to people who can actually move it.

  • Direct escalation
  • No support queues
  • Named account contact

Two decades of placements

Two decades placing and managing employment arrangements across global markets, with the local knowledge that prevents costly Latvian compliance mistakes.

  • Co-employment expertise
  • Honest fit advice
  • Right structure

We flex as your structure changes

PEO, EOR, and your own entity sit on a spectrum, and the right point shifts as you grow. We advise on the path and manage the moves, EOR to PEO, or either to your own Latvian SIA, as your Latvian presence develops.

  • EOR, PEO or entity
  • Transitions managed
  • Right fit as you grow

The employer duties a Latvian PEO shoulders

Whichever model you use, the underlying Latvian rules are the same. Under a PEO arrangement, the administrative employer functions are handled for you.

Working time, leave & contracts

Compliant Latvian employment contracts and working-time rules (40-hour standard week, minimum 4 calendar weeks’ annual leave). Income tax and the VSAOI contribution withheld and filed correctly. Statutory benefits, notice, and severance applied properly.

Statutory protections & exits

Statutory notice bands running from 3 days in probation to 1 month depending on the dismissal ground, and the protections Latvian employees carry under the Darba likums, all handled under the shared arrangement. The value is the same as with EOR: the compliance is handled by people who do it daily. The difference is simply how much of the employer role you keep.

What a PEO arrangement covers

The co-employment administration covers all of this, under one transparent fee.

Compliant contract

A compliant Latvian employment contract under the Darba likums, issued and maintained for you.

Payroll & filings

Monthly payroll run, with income tax and the VSAOI contribution calculated, withheld, and filed each month.

Statutory benefits

All statutory benefits administered: annual leave, sick pay, maternity and paternity benefit coordination, notice and severance.

Compliance & support

Ongoing HR compliance and a single point of contact, for the life of the engagement.

Your questions answered

Straight answers on how PEO co-employment works in Latvia.

What is the difference between PEO and EOR in Latvia?

With an EOR, the partner is the sole legal employer of your Latvian staff. With a PEO, you and the partner share the employer relationship, you keep more direct control, they handle the administration. In Latvia, EOR is the more established route, so PEO suits specific structures rather than the default case.

For most companies, EOR is simpler and faster, especially with no Latvian entity. PEO fits when you want to share rather than outsource the employer role, or have a structure that calls for it. We assess your situation and recommend honestly.

It depends on the structure. Some co-employment arrangements assume or work alongside your own Latvian entity. If you have no entity and want none, EOR is usually the cleaner route. We will confirm which applies to you.

The administrative employer functions, payroll, income tax, the VSAOI social insurance contribution, and statutory filings, are handled by the partner. We make sure the arrangement is structured so responsibilities are clear and Latvian law is met.

The statutory employer cost (23.59% of gross salary, one clean VSAOI rate) plus a partner service fee for the co-employment administration. We benchmark across our network for pricing typically 15 to 25% below going direct.

Yes. These models sit on a spectrum and the right one changes as you grow. We advise on the path and manage transitions, EOR to PEO, or either to your own Latvian SIA, as your Latvian presence develops.

Not sure whether PEO or EOR is right for Latvia?

Tell us your structure and headcount and we will give you an honest recommendation, usually within a day, plus pricing you will not get direct. No product push, just the right fit.

Tax and labour data verified July 2026 (State Revenue Service (VID), State Social Insurance Agency (VSAA), Register of Enterprises). Figures change; we confirm the current position when we scope your hire.