What Employment Laws in Portugal do I need to be aware of?

Whether you are starting a business in Portugal or you are planning to work there, you need to be aware of the employment laws and workers’ rights in Portugal. A breach of contract and a breach of fiduciary duty are two of the most common commercial disputes, so it is important to be aware of these issues before they arise.

In this guide, we will explore the key Portuguese employment laws, the different employment contracts and the requirements you need to meet to obtain a registration certificate. We will also discuss your rights if your contract is terminated, and whether or and the visa requirements to work in Portugal.

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Discover more about Portugal’s employment laws

The employment documents you should be aware of

Here are the various requirements you’ll need to meet to be successful in applying for a Portuguese

registration certificate

Know your rights if your employment or business contract is terminated

The visa required for long- and short-term work in Portugal

Here’s how we can assist

What are the Key Employment Laws to be Aware Of?

If you are thinking of setting up a business in Portugal, or you wish to work there, you must be aware of the employment laws in place, including the rules surrounding termination of employment. Portuguese employees cannot be dismissed unless their behaviour has made it impossible to continue their employment, they are unproductive, or their work is low quality.

All foreign and Portuguese employees’ rights can be found in the Portuguese Labour Code. It covers rights such as working hours, the minimum wage, health and safety and good work-life balance. These rights apply to remote workers and also those on working on the basis of temporary contracts.

The Portuguese Labour Code covers parental leave, working conditions and sick leave. All foreign employers should make themselves aware of these labour laws before starting a business in Portugal.

Signing a contract

Employers must pay social security in Portugal at a rate equal to 26.5% of the employee’s wage.

Annual leave for Portuguese employees amounts to 22 days of leave plus 13 national holidays. If you are aiming to start a business in Portugal there is an obligation to operate a training scheme for your employees, as they are entitled to 40 annual hours of training per year. You should be careful to classify your employees correctly and avoid misclassifying them as freelance, as there is a €9,000 fine for doing so. From June 2023 the minimum wage in Portugal is €740.83 per month.

Portuguese employers and managers are not permitted to contact their employees outside of working hours. Disruption of an employee’s work-life balance by contacting, texting or emailing them can result in a fine.

To ensure you are following Portuguese employment laws correctly, you are advised to consult a Portuguese commercial lawyer today.

What are the Different Types of Employment Documents in Portugal?

As expected, one of the most important documents Portuguese employees are entitled to is an employment contract. This is a written document that details the terms of employment and the worker’s rights, as well as the employer’s rights and responsibilities. The contract of employment must be signed by the employee and the employer.

Employees and employers who are not Portuguese nationals and have relocated to work will need a work visa and a work permit. There are particular requirements you must meet to obtain a Portuguese work visa, and there are also different types of visas that suit various types of workers. You are advised to discuss the best choice of visa for you with an experienced Portuguese lawyer.

Other important documents related to employment in Portugal include employee policies and handbooks, documents that outline particular procedures and personal improvement plans for employees. You can find out more about the necessary documents needed for starting a business in Portugal in our previous guide here.

What Requirements do I need to meet to Obtain a Registration Certificate in Portugal?

European Union (EU) citizens must obtain a registration certificate before setting up a company in Portugal. They can be obtained from the nearest city hall (câmara municipal). Foreign citizens, such as those from England and Wales, will need to apply for a visa before they can obtain a commercial registration certificate.

Anyone can request a permanent certificate of commercial registration at any time. Registration certificates for EU, EEA and Swiss citizens can be requested within 30 days of having been in the country for three months. Permanent commercial certificates can be requested online.

A Portuguese lawyer experienced in commercial law can help you obtain your registration certificate.

What Rights do I have if my Contract is Terminated?

As previously stated, employers must have good reason to terminate someone’s employment. Portuguese employees have the right to contest a termination within ten days of notification and the employer must offer their final decision within 30 days. The union cannot get involved unless the disciplined employee is a trade union representative.

No notice period is required for disciplinary dismissal, but those who have been dismissed on objective grounds are entitled to a notice period commensurate with the amount of time they have been an employee. Employees can accuse their employer of unfair dismissal under specific grounds, including:

  • If the dismissal was made on political or ideological grounds
  • If the dismissal is declared to be unfair, the employer will either have to reinstate the employee or pay them an indemnity in case of disciplinary dismissal.
  • For objective dismissal, employees are entitled to severance pay.

Do I need a Visa to Work in Portugal?

A visa is required to work or set up a company in Portugal unless you are a EU citizen.

You can either acquire short-stay visa that does not exceed 90 days, or a long stay visa that exceeds three months which can be renewed. If you eventually decide to become a Portuguese citizen, your Portugal work visa is no longer applicable.

Foreign citizens must apply for a work visa after they have secured a job in Portugal. Your employer will also need to apply for a Portuguese work permit on your behalf. A Portugal work visa is the most common type of visa for anyone with a contract to work for a period exceeding one year, there are other visas that may be better for you. An Independent Work Visa is for anyone wishing to work in Portugal on a self-employed basis, whereas a Highly Qualified Work Visa is for anyone conducting scientific research or with professional jobs such as medical professionals and engineers.

How Giambrone and Partners Can Help

Giambrone and Partners’ expert Portuguese lawyers have a comprehensive understanding of employment law and should you need to take legal action against your employer, we can help you build your case and gather any evidence required.

We can also protect business owners by drafting their employment contracts to ensure they are legally airtight. If you are considering working in Portugal, or want to set up a business, contact our Portuguese lawyers today to see how we can assist you.

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