Benefits in Portugal

In Portugal, annual salaries are divided into 14 payments instead of the standard 12. The extra two salaries are provided as a Christmas bonus paid by the 15th of December and a holiday bonus paid before the employee’s annual leave (usually June).

Employers need to sign a written agreement with each employee stating that 50% of the Christmas and Holiday allowances will be paid in 12 times, along with the monthly retribution. The remaining 50% will still be due on the dates stated in the paragraph above. It is not possible to include the allowances 100% in the 12 months retributions.

Employees in Portugal contributing to social security are covered for basic insurance by the government. This includes healthcare, pension fund, unemployment aid and paid parental leave.

Workers who have contributed to social security are entitled to one of three kinds of unemployment benefits due to the involuntary loss of employment (initiated by the employer):

• Unemployment benefit (Subsídio de Desemprego)
• Social unemployment benefit (Subsídio Social de Desemprego)
• Partial unemployment benefit (Subsídio de Desemprego Parcial)

Unemployment benefits can be awarded for between 9 and 38 months, depending on the employee’s age and the number of years they have worked and made social security contributions. To be eligible for unemployment benefits, an individual must have either worked at least 365 days consecutively or made voluntary contributions for two years. Those who are eligible will receive 65% of their average earnings for the first 180 days.

To qualify, the worker must meet the following conditions:

• Live in Portugal
• Be involuntarily unemployed
• Have capacity and availability for work
• Be registered for a job search at the employment office in your area of residence

The social unemployment benefit comes into place if the individual doesn’t meet the 365 days of work requirement. In that case, they can avail of the social unemployment benefit if they have worked 180 days in the past 12 months. The benefit is also awarded, at a later date, to people who are still unemployed when the period for payment of the unemployment benefit expires.

Partial unemployment benefit, on the other hand, is awarded if the individual has managed to find a part-time job after losing their full-time employment. It’s paid from the time the part-time job begins until the end of the period during which the individual is entitled to the full unemployment benefit. It corresponds to the difference between the unemployment benefits the employee was receiving plus 35% and the pay for the new part-time job.

Dismissal during the trial period:

• Employees can only access unemployment benefits in situations where the employment contract ends during the trial period, with a guarantee period of 120 days, once every two years from the date of termination of unemployment benefits.

Employers are obliged to contribute monthly 1% of an employee’s gross income to the Working Compensation Fund (Fundo de Compensação do Trabalho) and the Working Compensation Warranty Fund (Fundo de Garantia de Compensação do Trabalho). This protects employees from the risk of not receiving their salary in case the employer defaults.

All employees must be covered for accidents at work and on the way to and from work. Coverage insures employees with a temporary, permanent or partial disability or their families in case of death, including funeral grant, spouse or orphan’s pension.

Each year, employees have a right to receive a minimum of 40 hours of learning to enhance professional growth and relevance in their field. If hired on a fixed-term contract, employees are entitled to a minimum number of hours proportional to their agreement.

The employer may provide this annual training for up to two years in advance or defer it as long as the training plan is established. The employer must provide training to at least 10% of the company’s employees each year.

Employees may use the hours of professional training not provided by the employer to attend professional training at their initiative (including during working hours). At the end of the training, the employee must receive a certificate. Depending on the type of training, the certificate may need to be added to the National System of Qualification (Caderneta Individual de Competências nos termos do regime jurídico do Sistema Nacional de Qualificações).

If an employer terminates an employment contract for whatever reason, they have to pay compensation for the number of missing training hours.

It is common to offer meal vouchers or lunch cards to employees. Meal allowances are tax-free up to €6.00 daily if paid in cash and €9.60 if paid through lunch tickets.

Some companies offer monthly transportation allowance to and from work to employees.

Some companies offer private pension plans to employees.

Some employers offer supplementary health and life insurance to senior-level executives. Smaller companies usually provide an allowance in lieu of arranging insurance.

Depending on the nature of the job, some employees receive a cash bonus when fulfilling goals, quotas or targets. Same is valid for seniority bonuses.

Most tech companies offer flexible working hours to employees to accommodate their productivity.

Some companies offer smartphones to employees and cover the cost of their monthly phone plan.

Tech companies usually allow employees to select work equipment of their choice.

For jobs that require business travel, companies usually offer a tax-free daily allowance of €50.20 (€69.19 for members of the board) for trips within Portugal and €89.35 (€100.24 for members of the board) for international trips.

Companies in the tech space usually offer gym membership or gym discounts to their employees.