Investor's Guide - Labour System

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Portuguese Labour System




In recent years, Portuguese employment law has undergone many changes and adjustments. Thus, after more than 30 years of legislative reforms, the Portuguese labour system is now more flexible, particularly in terms of organizing working time.


In terms of regulations, the main law is the Labour Code, which was revised in 2009 (Law No. 7/2009 of February 12), 2011 (Law N. 53/2011 of October 13), 2012 (Law No. 23/2012 of June 25), 2013 (Law No. 69/2013 of August 30), 2014 (Law No. 27/2014 of May 8 and Law No. 55/2014 of August 25), 2015 (Law No. 28/2015 of April 14 and Law No. 120/2015 of September 1) and 2016 (Law No. 8/2016 of April 1) mainly further to the requirements that were undertaken by the Portuguese government within the context of the Memorandum of Economic and Financial Policies (MOU) signed in May 2011 with representatives of the International Monetary Fund, the EU and the European Central Bank.


There are also regulations that, along with the aforementioned law, govern work activities. Among these, it is important to highlight the collective labour regulations, the most common form being the collective bargaining agreement (CBA), an agreement between labour unions and employer associations, which regulates the activities of the sectors in question.


It is important to point out Law No. 55/2014 of August 25. This Law introduced an amendment to the articles 501 and 503 of the Portuguese Labour Code and entered into force on the September 1st, 2014.

Through this amendment the deadlines for the expiration of collective bargaining agreements were reduced when depending on its substitution for another collective bargaining agreement.

The duration of this period was reduced from 5 years to 3 years and it is counted from the date of its last publication, from its withdrawal or from the presentation of a proposal for the revision of the collective bargaining agreement in which is included the revision of such termination clause.

In case of expiration, the collective bargaining agreement will remain in force during the negotiation period or within 12 months (this period was of 18 months before).

This Law also sets forth that this regime should be revised within an year (until September 1st, 2015) in order to reduce the abovementioned terms from 3 years to 2 years and from 12 months to 6 months.

The possibility of temporary suspension of a collective bargaining agreement for market, structural or technological reasons or due to force majeure or other occurrences which might threaten the company´s viability and the maintenance of job posts is also foreseen.

This Law does not apply to the collective bargaining agreements which termination notice occurred before May 31st, 2014.


It is also important to refer that Law No. 120/2015 of September 1 establishes an enforcement of the maternity and paternity rights. In broad terms the Law creates a new incentive to the simultaneous exercise of the initial parental leave by the parents and the extension of the father's exclusive parental leave, which shall have a 15 business days' period. Moreover, new obligations concerning the publication of parental rights within the company have to be met by the employer and, most notably, new rights are conferred to the parents of a child until 3 years old, concerning its right to access the remote working regime and the special working time regimes (adaptability and bank of hours).
According to Law No. 8/2016 of April 1, there is an amendment to the Labour Code, reinstating the following holidays: Corpus Christi, October 5th, November 1st and December 1st.


In this chapter the most significant aspects of Portuguese labour law for business investment are described below.


1. Employment Contract

1.1. Employment Contract - Concept and Preparation

1.2. Trial Period

1.3. Professional Training

1.4. Types of Employment Contract

1.5. Labour Contract under Service Commission Regime

    1.6. Lay-off: Reduction of activity or suspension of the labour contracts

    1.7. Termination of Employment Contract

2. Remuneration

2.1. General rules on remuneration

2.2. Defining the salary’s amount

2.3. Guaranteed Monthly Minimum Wage

3. Working Hours 

4. Holidays, Vacations and Absences

4.1. Holidays

4.2. Vacations

4.3. Absences

5. Collective Representation, Strikes and Lock-outs

5.1. Collective Representation

5.2. Strikes

5.3. Lock-out

6. Specifics of Employment Contracts for Foreigners

7. Visas and Residency Permits for Foreigners

7.1. Visas

7.2. Residence Permit

7.3. Long-Term Resident Status

7.4. Golden Residence Permit Programme




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