Changes to the labour law

From October 1, 2019, new labour rules have come into force following publication of law number 93/2019, of September 4.

The amendment to the Labour Law changes a wide range of rules in light of the current paradigm of employment situations.

Firstly, positive measures in favour of workers with disabilities or chronic illnesses now also include cancer sufferers.

Also, in employment contracts without term, 180 days’ probation is now applied to workers looking for their first job and the long-term unemployed, which were previously only allocated to workers in highly technical positions or responsibility.

However, it wasn’t just the employment contract without term that changed. The system of short-term contracts has undergone even more significant changes.

With the amendment, the majority of short-term contracts’ legal regime can no longer be cancelled by collective labour regulation instruments.

The use of short-term contracts has also become more limited. For example, it is no longer possible to hire young people looking for their first job or long-term unemployed on short-term contracts. It is now only possible to hire those who have been unemployed for 25 months and over and are aged 45 or plus (very long-term unemployed).

On the other hand, from now on, only employers with fewer than 250 employees can hire on short-term contracts using the motive that it is a new establishment or new activity whose duration is still unknown.

The duration of short-term contracts has also been revised. For fixed-term contracts, the duration is two years maximum and for uncertain term contracts the maximum is four years. Short-term contracts can be renewed three times as before, but the total duration of these renewals may not exceed the duration of the initial contract.

There have also been changes to the intermittent work regime and its schedule. Intermittent work must be for a minimum of five months (full time) per year and, of those five months, three must be consecutive.

The amendment to the Labour Law also aimed to protect temporary workers. With the entry into force of the new labour rules, temporary contracts can only be renewed a maximum of six times, except when the reason for hiring is for the replacement of an absent worker due to accident, illness or other situation. In turn, it is applicable to the temporary worker the collective labour regulation instrument that is applicable to the user’s workers.

There was also a need to strengthen the protection of workers in cases of harassment. The worker can now invoke “just cause” for the termination of the contract when there is harassment in the workplace, either by the employer or a colleague.

On the other hand, the employer has the duty, in addition to respecting and treating the worker with integrity, to refrain from any acts that may affect the dignity of the worker, that are discriminatory, harmful, intimidating, hostile or humiliating to the worker, namely harassment.

In addition, disciplinary sanctions are considered abusive if motivated by the fact that the employee claimed to be a victim of harassment or is a witness in a judicial and/or administrative harassment process.

Another change is related to the regime of choice of the collective labour regulations instrument by the worker that is not affiliated in any trade union, when, within one company, there is one or more of these agreements.

The worker can still choose which of those instruments is to apply to him/her, but now the worker has to fall within the sector of activity, professional and geographical of the chosen instrument.

The worker may make the choice within three months of entry into force of the instrument chosen or of the commencement of the employment contract, if this happens later. However, the employee may only choose once while in the service of the same employer or another to which the same collective agreements apply.

Law number 93/2019 of September 4 also amended the Code of Contributory Regimes, adding a new rule to it: an additional contribution (levy) for excessive employee turnover. Thus, as from January 1, 2020, employers who have, in a calendar year, handled a number of short-term contracts that is higher than the indicator allowed for the sector will have to pay an additional contribution, the rate of which is progressive, up to a limit of 2% of the total amount of base salaries.

The implementation of this measure depends on the publication of a government decree in the first quarter of each calendar year, defining the sector-specific indicator.

Employment contracts signed prior to the entry into force of this law are subject to it, except as regards the conditions of validity and the effects of facts or situations prior to that time.

However, the new changes to short term employment contracts concerning its admissibility, renewal and duration, and to the renewal of temporary employment contracts, will not apply to contracts signed before the new rules come into force.

By Dr Eduardo Serra Jorge
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Dr Eduardo Serra Jorge is founding member, senior partner and CEO of lawyers firm Eduardo Serra Jorge & Maria José Garcia – Sociedade de Advogados, R.L., created in 1987.
In his column, he addresses legal issues affecting foreign residents in Portugal.
Faro office at Gaveto das Ruas Pedro Nunes e José de Matos, 5 R/C
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