INSTALEGAL - LABOUR
This newsletter is provided for information purposes only and does not constitute legal advice. Professional legal advice should be obtained before taking or refraining from any action as a result of the content of this document. If you have any questions regarding this newsletter, please contact BRAM.
Following the Parliament's approved Decree, published last 03-04-2023, numerous amendments to the Labour Code, within the scope of the so-called "Dignified Work Agenda and Valorisation of Youth in the Employment Market", came into force on May 1st. More than 104 articles were altered and there were another 52 amendments and additions to the specific legislation. These measures aim to improve working conditions and the conciliation between personal, family and professional life.
Some measures, related to stopping the expiry of the collective agreements - articles 500, 500-A, 501, 501-A, 502, 510, 511, 512 and 513 of the Labour Code - came into force the day after their publication, i.e. on 04-05-2023. We highlight below some of the main changes:
Teleworking: the right to telework is extended to workers with children up to the age of three or, regardless of their age, with children with a disability or chronic illness or oncological illness who live with the worker in the same household. The work activity must always be compatible with telework and the employer must have the resources and means for that purpose.
Teleworking expenses fixed in the contract: the additional expenses related with teleworking will have to be included in the contracts. In case there is no agreement between the employee and the employer on a fixed amount, additional expenses are those that correspond to the acquisition of goods and/or services that the employee did not have before the conclusion of the agreement, as well as those determined by comparison with the same expenses of the employee in the last month of work of the employee in the workplace.
Exemption limit for teleworking expenses: the value up to which the compensation that companies have to pay for additional expenses with teleworking are exempt from tax will be defined, although there is still no deadline for the Government to set the amount of the exemption limit. The compensation for the increase in expenses is considered, for tax purposes, a cost for the employer, and does not constitute income of the employee up to the limit of the value set by the ordinance of the members of the Government responsible for the areas of taxation and social security.
Sick leave: Sick leave of up to three days can be requested through the digital service of the National Health Service (SNS24), obtained under oath, and can be requested up to twice a year, for periods of up to three days. These sick days are not remunerated (neither by the employer nor by Social Security), as is the case with sick leave given by doctors.
Parental leave of the father: the father's compulsory parental leave will be increased from the current 20 working days to 28 consecutive or interpolated days, in a compulsory manner, in the 42 days following the birth of the child, 5 of which will be taken consecutively immediately after the birth. After the 28 days leave, the father will also be entitled to 7 days leave, consecutive or interpolated (instead of the current 5 working days), provided that they are taken simultaneously with the mother's initial parental leave.
Extension of leave and days of absence due to gestational bereavement and death: extension of days of absence due to death of spouse, child and stepchild. The leave is increased from 5 to 20 consecutive days. In the case of the death of other relatives or kin in the 1st degree in the direct line, the leave will be extended to 5 consecutive days. It was also created a leave for gestational bereavement (i.e. due to the death of the baby during pregnancy), which can go up to 3 days. Parents will have to provide their employer with proof of the death of the child during pregnancy (through a declaration from the hospital or health center, or even a medical certificate).
Option for parental leave in mixed part-time regime: if parents opt for shared initial parental leave, they may, after taking 120 consecutive days, cumulate, on each day, the remaining days of leave with part-time work. In this situation, the law now provides that: (i) the daily periods of leave shall be computed as half-days and shall be added for the purposes of determining the maximum duration of the leave; (ii) the period of leave may be taken by both parents, simultaneously or sequentially; (iii) part-time work shall correspond to a normal daily working period equal to half that practised on a full-time basis in a comparable situation.
Informal caregiver: informal caretakers will be entitled to request part-time work. These workers can take advantage of part-time work for a maximum period of four years, with a regime of flexible working hours, without being obliged to work overtime. An annual (unpaid) leave of five consecutive days was also created for these workers. The leave must be communicated to the employer 10 days in advance, indicating the dates on which the employee intends to take it.
Increase of the compensation for termination of fixed-term and permanent contracts: the amount of the compensation for termination of fixed-term contracts is increased from the current 18 days to 24 days base retribution and seniority for each full year of work. The compensation for termination of permanent contracts is also increased to 24 days of salary and seniority per year.
Increase of compensation for collective dismissal: the amount of the compensations for collective dismissal and redundancy is increased from 12 days base retribution and seniority per year to 14 days per year. It should be noted that this rule is not retroactive, as the increase in compensation, in these situations, will only apply to contracts entered into on or after 1 May 2023.
Employees cannot waive credits (allowances, overtime and training) at the end of the contract: prohibition of the abdicative remission (waiver) of credits regarding retribution, allowances or overtime work when leaving the company, except by means of a judicial agreement. Thus, the employee's credits will not be liable to be extinguished by means of abdicative remission, except by means of judicial settlement, i.e. by agreement in court.
Companies barred from outsourcing for one year after dismissal: after a collective dismissal or redundancy, companies are barred from outsourcing for one year. The violation of this rule constitutes a very serious administrative offence imputable to the beneficiary of the acquisition of services.
Temporary employment contracts with a limit of four renewals: for fixed-term temporary employment contracts, the maximum number of renewals is reduced from six to four, as long as the reason for the renewal persists. Temporary work companies, or other companies of the same group, are now obliged to hire workers on a permanent basis after four years of temporary work assignments.
Fixed-term employment contracts and prohibition of successive contracts: The new legal wording now establishes that the termination of a fixed-term employment contract, for reasons not attributable to the worker, prevents a new admission or assignment of a worker through a fixed-term or temporary employment contract, whose performance is carried out in the same job or professional activity, or even a service agreement contract for the same object or scope of activity, entered into with the same employer or company in a controlling or group relationship, or that maintains common organisational structures, before the expiry of a period equivalent to one third of the duration of the contract, including renewals.
The value of overtime work is increased (after the 100 annual hours): the value of each hour of overtime worked after the 100 annual hours is increased from 25% to 50% in the first hour or fraction thereof; from 37.5% to 75% per subsequent hour or fraction thereof, on a working day; and from 50% to 100% for each hour or fraction thereof, on a compulsory or complementary weekly rest day or on a public holiday.
Interns with Social Security and National Minimum Wage: professional internships are now paid at least 80% of the National Minimum Wage (set at 760 euros in 2023), and IEFP internship Grants for graduates are increased to 960 euros. Interns will have their Social Security status equated to an employment contract.
New employment contract with students on leave: there is a new type of employment contract for students on holiday from school or during a school break, not subject to written form. Even so, companies must inform the execution of the contract to the competent Social Security service, using an electronic form that must satisfy all the communication requirements set out in other legal provisions.
Digital platform workers: a presumption of an employment contract between operators and digital platforms (such as Bolt or Uber, among others) is foreseen, which will apply to the individual and remunerated transport of passengers in non-characterised vehicles (EDV) sector. When, in the relationship between the service provider and the digital platform, some characteristics defined therein are verified, there will automatically be an employment contract, with all the consequences resulting therefrom. The platform may demonstrate that it should not be considered as an employer. In such cases, it will be up to the courts to determine who is the employer.
Collective hiring with more benefits for companies: companies with collective hiring will obtain benefits in accessing public support or financing, including European funds, public hiring and tax incentives.
Obligation to communicate in advance the admission of workers to Social Security: the admission of workers now had to be communicated 15 days in advance. Exceptionally, communication of admission is allowed up to 24 hours after the start of the contract, but in that case employer must justify the reason for the delay. A delay of 24 hours in communicating admission is a minor infraction and, after 24 hours, it is very serious infraction; delays of 6 months or more constitute a crime.
Reduced or excluded trial period: the trial period for first-time job seekers and long-term unemployment, previously of 180 days, is reduced or excluded if the duration of the previous fixed-term employment contract, entered into with a different employer, was equal to or greater than 90 days. In cases of trial periods of 120 days or more, the employer is obliged to give the employee 30 days' notice of termination (instead of the previous 15 days).
Details of the trial period in the employment contract: namely its duration and conditions, if applicable - with the provison that, if this information is not available, the trial period is considered non-existent. In addition, the employer must inform the CITE, within five working days of the date of termination, of the termination of the employment contract during the trial period, whenever a pregnant worker, a worker who has recently given birth or is breastfeeding, or a worker on parental leave, as well as in the case of caretaker worker, are involved.
Limitation of exclusivity clauses: the employer may not prevent the worker from exercising another professional activity (other than the one carried out for the employer), unless it is based on objective grounds duly detailed, such as safety and health or professional secrecy. And if there are, any unfavorable treatment of the worker due to the fact that he/she is engaged in another professional activity will be prohibited. It should be noted that the fact that there is no longer a duty of exclusivity - which ceases to exist in most cases – it does not affect the duty of non-competition, which remains as one of the main duties of the employee.
Forbidding discriminatory practices: the new legal wording, which forbids discriminatory acts, now considers as discriminatory practices, namely, remuneration discrimination related to the attribution of attendance and productivity bonuses, as well as unfavourable allocations in terms of evaluation and career progression, due to the enjoyment of parental rights, other rights foreseen in the scope of conciliation of professional activity with family and personal life, and rights foreseen for the caregiver worker.
Duty to inform the employee: there are new elements to be considered added to the already vast set of information that must be provided to the employee at the beginning of the employment relationship, such as:
i. the stipulated term or the foreseeable duration of the contract, in the case of a fixed-term or uncertain term contract, respectively;
ii. notice periods and formal requirements to be observed by the employer and the employee for termination of the contract, or the criterion for their determination;
iii. the amount, periodicity and method of payment of the retribution, including a breakdown of its constituent elements;
iv. the normal daily and weekly work period, specifying the cases in which it is defined in average terms, as well as the regime applicable in the case of overtime work and shift work;
v. designation of the entities that signed the applicable collective work regulation instrument;
vi. identification of the work compensation guarantee fund;
vii. in the case of temporary workers, identification of the user; viii) duration and conditions of the trial period, if applicable;
ix. individual right to continuous training;
x. miscellaneous information legally stipulated in the case of intermittent work ;
xii. parameters, criteria, rules and instructions on which the algorithms or other artificial intelligence systems that affect decision-making on access to and maintenance of employment are based, as well as working conditions, including profiling and control of professional activity.
This document summarizes some of the main amendments to the Labor Code and their implementation in the legal system, and does not waive the need with to consult the national legislation in force, the Labour Code Regulations, the regulation of collective bargaining, or consulting with specialized professionals. This is not a technical document, nor is it intended to be exhaustive in relation to all the matters in question.
A EQUIPA BRAM
PEDRO ASCENSÃO
PARTNER
pa@bramlegal.pt
Partner at BRAM, has been practicing since 1995, with more than 20 years of experience in the area of employment law.
Before joining BRAM, practiced individually until 2007 and since then, until 2019, he was a partner at the law firm AMBA, having carried out almost exclusively his activity in the area of labor and civil litigation.
Has particular activity in advising in the retail area, accompanying several Portuguese and foreign companies, with particular focus on Spanish corporations.
JOSÉ PINTO-COELHO
ASSOCIATE
Associate at BRAM, with more than 16 years of experience.
Is particularly active in providing legal advice in the area of retail and large-scale distribution, assisting various Portuguese and foreign companies.
Was In-House Counsel for almost 7 years for one of the main players in the retail and large-scale distribution sector, working almost exclusively in the areas of civil, labor and social security litigation, and was also DPO (Data Protection and Compliance Officer) of one of the Group's entities.
MARIA BARBOSA DA GAMA
ASSOCIATE
mbg@bramlegal.pt
Associate at BRAM, since 2018.
With over 15 years of experience, Maria worked as a trainee at the law firm Correia Afonso, Archer & Associados where she remained, already as a lawyer, until 2016.
Practiced in solo practice from 2016 to 2018, where besides Labor Law she also dedicated herself to the area of Family Law.
BRAGA DA COSTA, AFRA ROSA, MEXIA, REYNOLDS, MALTA VACAS & ASSOCIADOS, SOCIEDADE DE ADVOGADOS, SP, RL
Avenida 5 de Outubro, n.º 85, 5º andar, 1050-050 Lisboa | Tel. (+351) 210 734 790 Fax: (+351) 210 131 576
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