Updated: Nov 8
Portugal has several types of employment contracts. All of them bind the employment relationship between a worker and a company. They will be listed below.
Because of differences in contracts, it can be tricky to enter the labor market in Portugal. For example, expiry, duration, and trial period vary. An employment contract can be written or verbal. Also, it includes the rights and duties of each party. Moreover, the conditions and remuneration are inserted. Also, a trial period can be included. This period allows both parties to decide on pursuing further interest in maintaining a contractual relationship.
Promise of employment
In addition, a written promise of employment contract can be entered into. Included are:
· Identification, signatures and domicile or seat of the parties;
· Unequivocal statement from whoever promises to enter into said contract;
· Activity to be provided and its retribution.
Types of employment contracts in Portugal
The employment contract may vary. Impacts can be the company, activity, and your probationary periods.
Fixed-term employment contract
A fixed-term contract is a temporary contract. So, its duration and time of termination have been previously determined by the employer. It is most used in the following situations:
· Direct or indirect replacement of a worker who is temporarily unable to work or pending the decision to dismiss with just cause;
· Exceptionalincrease in company activity;
· Seasonal activity;
· Replacement of a full-time worker who starts to provide part-time work for a specified period.
The fixed-term contract cannot be longer than two years. However, it can be renewed twice if the duration is less than one year.
Uncertain term employment contract
A company uses an uncertain term contract to satisfy temporary needs. In this case, there is no defined term for the termination of the contract.This type of contract has a maximum duration of 4 years. Then, the employee is entitled to compensation.
Indefinite employment contract
This type of contract can be for an indefinite period, without any provision for termination. However, during the trial period, any party can decide on termination of the contract. No prior notice or just cause has to be given. Likewise, there is no place for any kind of compensation.
Short-term employment contract
Contracts of very short duration serve as a response to an exceptional increase in the company's activity. For example, there could be irregularities due to the respective market, like the agriculture or tourism sector. The maximum of the contract is 35 consecutive days. Meanwhile, it cannot exceed 70 days per calendar year.
Part-time employment contract
The part-time contract exists when the weekly working period is less than full-time. The maximum percentage limit of the full-time hours determines the part-time hours. In most cases, a full-time week is 40 hours.
Mostly, temporary work is offered by companies. These companies reach out to other entities for temporary jobs. Then, they offer their members these positions. The entity exercises the powers of authority and direction. There is no minimum duration limit for the temporary employment contract.
This contract is applied to self-employed workers. To elaborate, these workers have their own businesses where they perform services for clients. In this instance, the self-employed are obligated to pay the company taxes.
· The guaranteed minimum monthly wage (also known as the National Minimum Wage) is €665;
· The normal working period is limited to 8 hours a day and 40 hours a week;
· Each worker is entitled, in each calendar year, to a period of paid vacation. This period expires on January 1 of each year. The minimum period is 22 vacation days per year;
· While the worker is on vacation, the pay should be equal to the wage when in normal service.
· During the vacation period, the employee is entitled to a vacation allowance. This includes base salary and other benefits.
BA in Human Resources Management and Development
University Lusófona do Porto