Labour law in Portugal is about to undergo a major reform. With over 100 proposed amendments to the Labour Code under discussion, the Government has presented the draft bill “Trabalho XXI”, aiming to modernise, increase flexibility and adapt Labour Law to new social and economic demands.
New limits for employment contracts
One of the most significant changes in the new labour law is the extension of fixed-term contract durations. Fixed-term contracts may increase from 2 to 3 years, with a minimum initial duration of one year instead of the current 6 months. Meanwhile, open-ended fixed-term contracts may be extended from 4 to 5 years. Additionally, the Government intends to allow more situations where fixed-term contracts can be used, such as for long-term unemployed individuals or retirees due to age or disability.
Return of the individual working hours bank
Another key change is the return of the individual working hours bank, allowing employers and employees to agree on extending the working day by up to 2 additional hours, with a maximum of 150 hours per year.
Clarification of remote and hybrid work
Remote work is also addressed in the new labour law. The proposals aim to make it more flexible and clearer, adapting the legal framework to hybrid work models and ensuring proportional compensation for remote workdays.
The Government also wants to define the balance between remote and on-site work and allow temporary changes to the workplace, provided they are communicated at least 5 days in advance.
Parental leave and family rights
In terms of parental rights, the new labour law proposes that initial parental leave may extend up to six months, provided it is shared between both parents. The parental allowance will be paid at 100% if parents choose to equally split the additional 60 days after the mandatory 120 days. Moreover, parents may be required to take exclusive parental leave during the first 14 days after the child’s birth, instead of the current 7 days.
There are also changes to breastfeeding leave, which will be limited to 2 years and require a medical certificate renewed every six months. On the other hand, the Government proposes eliminating the 3-day leave for gestational grief, meaning the other parent may have to rely on unpaid family assistance leave.
Expansion of minimum services during strikes
The proposal includes expanding minimum service requirements during strikes to sectors such as nurseries, care homes, schools and private security services. While some sectors already have minimum service obligations, the new changes aim to define minimum operational percentages to ensure continuity.
Continuous training
Continuous training is a key focus in the new labour law, with mandatory annual training hours of 20 hours for microenterprises and 40 hours for all other companies
Purchase of additional vacation days
Under the new proposal, employees will be able to purchase up to 2 additional vacation days per year. This purchase will result in a corresponding salary deduction, but will not affect other benefits, such as attendance records or social security contributions.
Conclusion
The reform proposed by the Portuguese Government represents an ambitious effort to update employment law in Portugal, aiming to increase flexibility and business competitiveness.
The new labour law is still under negotiation with social partners and must be approved by Parliament. Until then, it is crucial for companies and professionals to stay informed and prepare to adapt to the upcoming legal requirements.
At Lamares, Capela & Associados, we closely monitor legislative developments and provide our clients with up-to-date, accurate information and strategic legal advice to navigate any changes.
Whether you are a company or an employee, if you need legal support in the field of Labour Law, don’t hesitate to contact us.