Portugal

• Freedom Day
• Labour Day
• Portugal Day
• Saint Anthony’s
• Assumption Day
• Republic Day
• All Saint’s Day
• Restoration of Independence Day
• Immaculate Conception
• Christmas Day

Working Hours

The Portuguese Labour Law establishes a maximum of 8 daily working hours and 40 weekly working hours. A  collective bargaining agreement may fix fewer working hours per week or day.

Minimum Wage

Effective 1^st January 2025, full-time employees are entitled to a minimum monthly wage of EUR 870, calculated over 14 payments (12 calendar months plus a Christmas and holiday bonus).

Employee Tax

Annual income	Tax rate
Up to EUR 7,479	14.5%
EUR 7,479 - 11,284	21% - EUR 486.14
EUR 11,284 - 15,992	26.5% - EUR 1,106.73
EUR 15,992 - 20,700	28.5% - EUR 1,426.65
EUR 20,700 - 26,355	35% - EUR 2,772.14
EUR 26,355 - 38,632	37% - EUR 3,299.12
EUR 38,632 - 50,483	43.5% - EUR 5,810.25
EUR 50,483 - 78,834	45% - EUR 6,567.33
More than EUR 78,834	48% - EUR 8,932.68
Social security contribution	11%

Bonuses

There are mandatory 13th and 14th salary payments in Portugal.

Employment contracts in Portugal must be written. They should include the terms of the employee’s compensation, benefits, and termination requirements.

An offer letter and employment contract in Portugal must always state the annual salary and any compensation amounts in Euros rather than a foreign currency.

Remote work contracts:

In addition to the standard clauses of an employment contract, remote work contracts must stipulate the compensation due to the employee to cover additional expenses related to remote work. The expenses must be supported by invoices for the compensation to be tax-free.

Provided work can be performed remotely, certain groups of employees have the right to work remotely, they include:

• Employees with children under the age of three; and
• Employees with children with a disability, chronic illness or oncological disease, regardless of age.

Annual Leave

The statutory minimum is 22 workdays (a maximum of 20 days in the first year of employment, with the employee acquiring 2 days per complete month).

Sick Leave

Portuguese social security pays after the 3rd day of illness. Employees can receive sick pay for up to 1,095 days. Pay is generally 55% to 75% of the employee’s salary.

Parental Leave

In Portugal, after the birth or adoption of a child, the mother and father are both entitled to parental leave, which encompasses both maternity and paternity leave. There are two types of parental leave: initial and extended parental leave.

Initial parental leave: Lasts for 120 or 150 days, including compulsory maternity and paternity leave. Female employees must take 42 days of compulsory maternity leave, while male employees are required to take 28 days of compulsory paternity leave—7 days immediately after the child's birth and the remaining 21 days within 42 days.

Extended parental leave: Can be extended for up to three months for both parents, taken immediately after the initial leave.

Leave for pregnancy loss: In cases of miscarriage, both the female and male employees are entitled to three (3) days of leave. Payment is on the employer.

Grandchild care leave: In support of young parents, when one of the parents is under 16 years old, working grandparents living with the baby are entitled to 30 consecutive days of leave after the birth. This leave may be shared between the grandparents. Social security pays remuneration at 100%.

Termination Process

Employers in Portugal must give the following number of days notice when terminating a contract:

• 15 days is required for employees with less than 1 years’ service
• 30 days for those between 1 and 5 years’ service
• 60 days for those between 5 and 10 years’ service
• 75 days for employees with over 10 years’ service

Severance Pay

In cases of redundancies, employees are entitled to severance pay equal to 14 days' basic pay and seniority for each full year of seniority.

In the case of termination of fixed- term and permanent employment contracts, employees are entitled to severance pay equal to 24 days' basic pay and seniority pay for each full year of seniority.

Under a Mauve Group Employer of Record solution, clients and workers can reap the benefits of Mauve’s Global Master Insurance Programme – a market-leading unified corporate insurance programme that connects all Mauve entities to its two preferred providers.

The insurance provides coverage in overseas locations through a combination of the master policy and its linked local policies, where required by law in certain jurisdictions.  The policies include:

• Employer’s Liability and Public Liability - £10,000,000 combined limit.
• Professional Indemnity - £5,000,000 limit.
• Worker’s Compensation – Limit is dependent on location of work.

For specific information about statutory and recommended insurances in your chosen country, get in touch with Mauve.