Portugal
Knowledge Base
Frequently asked question, important data and information on EOR.
General information
760 EUR per month
Labor Law
Laws that regulate Labor Relationship
Labour Code (Codigo de Trabalho). Law No. 7/2009
Onboarding guide
Requirements for a labor contract
• Identification, signatures and address of the parties the employer and the employee
• Job position and description
• Salary
• Place of work and
• Working hours
• Start date
• End date (for fixed-term contracts)
Pre-hire Medical exam
Yes, mandatory.
Types of contracts
• Indefinite-term contract
• Fixed- term contract
• Part-time contract of employment
• Temporary work
• Provision of services
Probation Period
Annual
Are offer letters mandatory in the country?
No.
Are digital signatures in labor contracts valid?
Permitted.
Mandatory onboarding documents
• ID (or Passport)
• NISS
• NIF
• Resume/CV
• Fill the form: https://app.smartsheet.eu/b/form/d44737f426bb46b8aef66e52f521f84a
Statutory benefits
Annual Bonus
In Portugal, annual salaries are divided into 14 payments instead of the standard 12. The extra two salaries are provided as a Christmas bonus paid by the 15th of December and a holiday bonus paid before the employee’s annual leave (usually June).
Employers need to sign a written agreement with each employee stating that 50% of the Christmas and Holiday allowances will be paid in 12 times, along with the monthly retribution. The remaining 50% will still be due on the dates stated in the paragraph above. It is not possible to include the allowances 100% in the 12 months retributions.
Additional bonus
Holiday bonus paid before the employee’s annual leave (usually June). See Annual Bonus.
Leaves (medical, maternity, paternity, etc.)
Sick leave: To be entitled to sickness benefit you must be duly certified by the competent health service doctor as temporarily unable to work, and have a record of remuneration of six calendar months, consecutive or otherwise, from the date of commencement of the illness, considering, where necessary, the month in which the illness occurred if remuneration was recorded in that month (guarantee period). The daily benefit is calculated by applying a percentage to the beneficiary’s reference remuneration. This percentage varies according to the duration and nature of the illness:
• if the illness lasts for up to 30 days, you are entitled to 55% of the reference remuneration
• if the illness lasts between 31 and 90 days, you are entitled to 60% of the reference remuneration
• if the illness lasts between 91 to 365 days, you are entitled to 70% of the reference remuneration
• if the illness lasts more than 365 days, you are entitled to 75% of the reference remuneration.
Leave of clinical risk during pregnancy: In a situation of clinical risk to the pregnant worker or to the unborn child, impeding the exercise of functions, regardless of the reason that determines this impediment and whether or not this is related to the conditions of work, if the employer does not provide the an activity compatible with her professional status and category, the worker is entitled to leave for the period of time prescribed by medical prescription considered necessary to prevent the risk, notwithstanding initial parental leave. Leave for pregnancy termination: In case of termination of pregnancy, the worker is entitled to a licence lasting between 14 and 30 days. For the purpose stipulated in the previous number, the worker informs the employer and presents, as soon as possible, a medical certificate stating the period of leave.
Initial parental leave:
•The working mother and father shall be entitled, based on her child’s birth, to initial parental leave of 120 or 150 consecutive days, the enjoyment of which may be shared after childbirth. The leave referred previously shall be increased by 30 days if each of the parents has a period of 30 consecutive days, or two periods of 15 consecutive days, after the period of compulsory. In the case of multiple births, the period of leave provided for in the previous numbers shall be increased by 30 days for each twin in addition to the first.
•The enjoyment of the simultaneous parental leave, of mother and father who work in the same company, being this a microenterprise, depends on agreement with the employer.
• The mother can enjoy up to 30 days of the initial parental leave before giving birth.
• The mother must enjoy six weeks’ leave after childbirth.
• The father shall be required to take parental leave of 15 working days, followed or interpolated, within 30 days of the birth of the child, five of whom shall be taken consecutively immediately thereafter.
Adoption leave: In case of adoption under the age of 15, the applicant for adoption shall be entitled to the leave according to the regulations of the Initial parental leave.
Annual Leave (days per year)
In each calendar year the worker is entitled to a period of paid holidays, which expires on 1 January. The worker is entitled to a minimum of 22 working days’ holiday per year.
How do vacation days expire?
In the year of admission the worker is entitled to two working days’ holiday per month of the contract, up to 20 days, which may be taken after six full months of contract performance.
If the calendar year ends before the worker has completed the six months, holidays can be taken by 30 June of the following calendar year. In that year, however, no worker may take more than 30 working days holiday, unless this is allowed by the collective labour regulation instrument.
Official Holidays
• Jan 1, New Year
• Apr 7, Good Friday
• Apr 9, Easter
• Apr 25, Freedom day
• May 1, Labor Day
• Jun 8, Corpus Christi
• Jun 10, Portugal Day
• Aug 15, Assumption Day
• Oct 5, Republic Day
• Nov 1, All Saints’ Day
• Dec 1, Restoration of Independence
• Dec 8, Immaculate Conception Day
• Dec 25, Christmas Day
Working on holidays and Sundays
A worker who provides normal work on a corporate holiday not obliged to suspend operation on that day is entitled to compensatory rest lasting half the number of hours provided or a 50% increase in the
corresponding remuneration, being the choice of the employer.
Labour Code, Law No. 7/2009 , article 269.
Number of Working hours
The maximum limits of the normal working period are from 8 to 40 hours, per day and per week respectively.
Overtime
The employee who works on a mandatory weekly rest day is entitled to a paid compensatory rest day, to be taken on one of the following three working days. Compensatory rest is defined as an agreement between the employee and employer or, failing that, by the employer.
The additional work is paid by the amount of the hourly remuneration with the following additions:
a) 25% for the first hour or fraction thereof and 37.5% per hour or subsequent fraction, on a business day;
b) 50% for each hour or fraction, on weekly rest day, mandatory or complementary, or on holiday.
Labour Code, Law No. 7/2009
Social Security (what does it cover)
• Retirement Pension
• Orphan and Widow Pension
• Statutory leaves (See Leaves question)
• Child Benefits
• Unemployment Benefits
Payroll
Salary payment currency
Euro (EUR)
Can salary be paid in a different currency other than the local currency?
Not permitted.
Payment frequency
Monthly.
VAT percentage
23%
Income Tax
Residents in Portugal for tax purposes are taxed on their worldwide income at progressive rates varying from 14.5% to 48% for 2023. For more information see https://taxsummaries.pwc.com/portugal/individual/taxes-on-personal-income
Tax Payer Identification Number
Tax Identification Number – NIF (Número de Identificação Fiscal)
Offboarding
Voluntary resignation
Unilateral Termination of the Labour Contract by the Employee with Just Cause:
•The employee must notify the employer in writing of the termination of the contract, stating briefly the facts that justify the termination, within 30 days of becoming aware of the facts.
•In this event, the employee is entitled to compensation to be determined between 15 and 45 days of base pay and seniority pay for each year worked, depending on the amount of compensation and the extent of the employer’s unlawful conduct, and may not be less than 3 months of base pay and seniority pay. Unilateral Termination of the Labour Contract by the Employee without Just Cause:
•The employee may terminate a contract regardless of cause by notifying the employer in writing at least 30 or 60 days in advance, depending on whether he or she has worked, respectively, up to 2 years or for more than 2 years.
•Collective bargaining regulation and the employment contract may increase the prior notice period by up to 6 months for an employee who holds a management or executive position, or one who has representative or responsibility duties.
•In the case of a fixed-term contract, termination may take place with notice given 30 or 15 days in advance, if the contractual duration is at least 6 months or less.
Contract termination
In general, an employment contract expires for the following reasons:
• It reaches its end date (for instance, fixed or unfixed term contracts);
• Due to absolute and definitive supervening facts preventing a employee from doing his job or the employer from receiving it;
• When a employee retires, due to age or disability.
Justified Dismissal
A employee’s willful and guilty conduct is just cause for dismissal when, due to its seriousness and consequences, it becomes immediately impossible to continue the employment relationship.
The following types of conduct are just cause for dismissal:
• Unlawful disobedience of orders given by superiors;
• Violation of the company’s employee rights and entitlements;
• Repeated provocation of conflicts with company employees;
• Repeated failure to fulfill obligations related to one’s position or job, with appropriate effort;
• Serious damage to the company’s assets;
• False statements regarding the justification of absences;
• Unjustified absences that directly lead to harm or serious risk to the company, or whose number reaches in each calendar year 5 consecutive or 10 interspersed absences, regardless of damage or risk;
• Willful failure to follow safety and health rules at work;
• Engaging in physical violence, injuries or other offenses punishable by law, while at work, against employees of the company, members of governing bodies or an individual employer not belonging to these, their delegates or representatives;
• Kidnapping, or in general, any violation of freedom of the persons mentioned in the preceding item;
• Failure to comply with or opposition to fulfillment of judicial or administrative decisions;
• Abnormal reduction in productivity.
Whenever a certain behavior constitutes just cause for dismissal, the employer shall notify the employee in writing of the company’s intention to proceed with his/her dismissal, adding a statement of misconduct with a detailed description of the facts charged to the employee. On the same date, the employer sends copies of the notice and statement of misconduct to the employees commission, and if the employee is a union representative, to their respective employees union.
The employee has then 10 business days to consult the documents and respond to the statement of misconduct.
Unjustified Dismissal
The dismissed employees may file a claim before a Labour Court in order to challenge the termination of their labour contracts. If the Court decides that there was any illegal procedure or lack of reasons or formalities on the dismissal, he employees may choose between being reinstated in the company, or receive a compensation ranging between 15 and 45 days of base remuneration plus seniority bonus per each year or fraction of year of seniority, with a minimum of three months of base remuneration plus seniority bonus. On both situations, the employees shall be entitled to the salaries which they would have received if the dismissal had not taken place and to an eventual compensation for damages suffered.
Employees are entitled to compensation calculated in the Labour Code terms, corresponding to 12 days’ salary for every year of work, with the following maximum limits:
• The salary used as a basis to calculate the compensation may not be higher than €12,700 (20 times the national minimum wage)
• The global amount of compensation may not be higher than 12 times the monthly salary or €152,400 (240 times the national minimum wage)
• For a partial year, compensation is calculated proportionally
Minimum Notice Period
For the trial period, if:
• the trial period lasting more than 60 days, the termination of the contract by the employer depends on seven days notice.
• the trial period lasted more than 120 days, the termination of the contract by the employer depends on 15 days notice.
For the employer: The employer must observe the following minimum notice periods which vary in accordance with each employee’s seniority:
• 15 days for employees with less than one year of service;
• 30 days for employees with one to five years of service;
• 60 days for employees with five years or more and up to ten years of service;
• 75 days for employees with more than ten years of service.
In the case of volunteer resignation notification periods, see Volunteer Resignation.
Immigration
Visa process
• The employer applies for the Work Permit: Once the employer offers the job, they have to apply for a Work Permit (Autorização de Trabalho) at the Portuguese Labor Authorities or the Portuguese Immigration and Borders Service (Serviço de Estrangeiros e Fronteiras – SEF) on the employee behalf .
• Apply for a Work Visa at the Portuguese Embassy: Once the employee have a Work Permit, he/she must apply for a work visa at the Portugal Embassy, to enter the country .
• Apply for a Portugal Residence Permit: Once the employee have arrived in Portugal, he/she must apply for your Residence Permit for Work at the Portuguese Immigration and Borders Service (SEF). This is what allows the employee to live in Portugal long-term.
Visa documents
The required documents for work in Portugal depend on your nationality. If you are an EU/EEA or Swiss citizen, you do not need a visa to work in Portugal. However, if you intend to live in Portugal for longer than three months, you must get a Residence Certificate (Certificado de Registo)
If you are not an EU/EEA or Swiss citizen, you will need to apply for a work visa to be allowed to work in Portugal. The documents required for a Portugal work visa include:
• A valid passport
• Passport-size pictures
• Proof of sufficient funds to sustain yourself
• Criminal records from your country of residence
• A document giving permission to the SEF to check your Portuguese criminal records
• Proof of health insurance
• Proof of accommodation in Portugal
• Your employment contract
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