Last October 1st 2019, the Portuguese Labour Code went through important changes. Most of those changes went into effect that same day and affected existing labour agreements, except in the cases concerning its form or validity. The new rules concerning duration or renewal, do not apply to the labour agreements in effect on October 1st. However, individual bank hours that were in effect that date will cease one year after the new law goes into effect.
In the present brochure, we will cover the most significant changes.
1. TRIAL PERIOD
In an indefinite term employment agreement concluded with an employee on his/her first job, or one that has been in a situation of long term unemployment, the basic trial period was increased to 180 days. The duration of a professional internship for the same activity is imputed in the duration of the trial period and, as such, the trial period can be extinguished by the time spent on internship.
2. RIGHTS AND DUTIES
â Each employee will be entitled to a period of professional formation of 40 hours, instead of the previous 35.
â The duty of the employer to be polite and respectful to the employee now includes the obligation to avoid any actions that may affect the employeeâs dignity or are discriminatory, harmful, intimidating, hostile or humiliating to him/her, namely harassment. Guilty breach of these duties gives the employee cause to terminate the agreement. Correspondingly, an abusive disciplinary sanction now constitutes a serious offense and, from now on, a sentence resulting from a condemnatory action, for the practice of harassment must be communicated by the court to the Social Security;
â The term agreements may not be changed through an instrument of collective regulation of work, except for temporary needs indicated as the reasons behind the hiring and for the preference rules of an employee with a term agreement in the conclusion of an indefinite term employment agreement. The hiring of an employee justified by the launching of a new activity of uncertain duration or the beginning of activity of the company can only be concluded by companies with less than 250 employees. The search for the first job, or long time unemployment can no longer be used as justification for hiring an employee through a term agreement. Only employees in a situation of âvery long timeâ unemployment can be hired in these circumstances. The term âvery long timeâ should be consulted in the appropriate law.
  FIXED-TERM AGREEMENTS WILL NOW HAVE A MAXIMUM DURATION OF 2 YEARS
The maximum period for uncertain-term agreements was reduced from 6 to 4 years. The maximum of renewals (up to 3) cannot exceed the initial term of the agreement.
Besides the situations of seasonal agricultural activity and touristic events, the agreement of very short duration (up to 35 days, with a maximum of 70 days per year) can now be used as well to accommodate the exceptional and substantial increase of companyâs activity whose annual cycle shows irregularities stemming from market or structural nature that cannot be managed by the permanent companyâs structure.
If in the same civil year, the employer presents an annual volume of hiring with term-agreements that is higher than the annual indicator applicable to the corresponding activity sector, he will be subject to an additional contribution for Social Security. This indicator, defined by the Government, will be published during the first trimester of each civil year and will have different tiers, up to a maximum of 2%.
3. WORK HOURS
The individual hour bank was eliminated and it cannot be further concluded between the employer and the employee. All existing agreements of this nature in force in October 1st, 2019 will automatically cease in one year.
As for the group hour bank, it is now possible to apply its regime to the team, section or economic unity employees for a period of no more than 4 years, if approved in a referendum with at least 65% approval of the employees affected by the measure. Before holding this referendum, a communication must be sent to the employeesâ representatives as well as to the Authority for the Working Conditions (ACT) which has the duty to oversee that referendum every time the number of affected employees is less than 10.
The group hour bank regime can be terminated before the predicted deadline if after half the period of applications elapses, at least one third of the affected employees asks the employer for a new referendum and that referendum is not held within the following 60 days or, even if held, it is not approved, or even when changes of the composition of the team, section or economic unit determines that the remaining employees are less than 65% of those affected by the proposed referendum.
4. OTHER MODALITIES OF LABOUR AGREEMENT
- INTERMITTENT WORK:
The minimum complete period was reduced to 5 months, of which 3 months should be performed by the employee consecutively. The employer should communicate to the employee a request to return to the job, after the inactivity period, with a minimum deadline of 30 days, instead of 20. Breaking the remuneratory rights of these employees during inactivity periods constitutes a serious breach. However, the employee must inform the employer if he/she starts any other labour activity during the inactivity period, being the salary paid in that new activity subtracted to the amount that he/she is entitled to receive during that same period, which should be 20% of the basic paying amount. - TEMPORARY WORK:
Since October 1st, the lack of conclusion of a temporary work agreement leads to an indefinite term labour relationship.
The lack of any of the legally imposed formalities gives cause for annulling the agreement, also leading to an indefinite term labour relationship. The justification for the temporary labour agreement must correspond to the reason presented in the agreement of request of employee, save for confidential information. This type of agreement can only be renewed up to 6 times, except in those cases where an absent employee is being substituted, for reasons not related to a conduct of the employer (disease, accident, parental licenses and similar situations).
5. TERMINATION OF THE LABOUR AGREEMENT
Some deadlines concerning the procedure of dismissal due to extinction of job were increased until 15 days thus benefitting the employee, such as the deadline for the employeesâ representative structure, the affected employee and the union to issue an opinion on the communication informing of the intention of dismiss the employee.
6. COLLECTIVE REGULATION
Any rules contained in collective regulatory instruments of work (such as collective regulations), contrary to imperative rules of the Portuguese Labour Code must now be modified in the first revision that happens within the 12 subsequent months after October 1st. If not, those rules will become void.
The instruments of collective regulation can only define extra work payments if they do it in a more beneficial way to the employee, going beyond the increments contained in the law (business day, 25% in the first hour and 37,5% per hour or subsequent fraction in business days and 50% per hour or fraction on a resting day or on a national holiday).
Terminating a collective working convention needs to be justified as well as extra formalities need to be taken into consideration, namely those of economic or structural nature, or those that reveal disadjustments of the terminated convention regime. On the other hand, by way of specific arbitration that can be requested by any of the parties, the period subsequent to terminating the agreement that could last up to 18 months, can now be extended up to 22 months, as long as the parties continue to work out an understanding. This change will only go into effect with the future publication of specific legislation regulating these topics.