Hiring in Portugal

Employment contracts in Portugal

Open-ended contracts are the norm. Fixed-term contracts must be in writing and give a valid reason. They can run for up to 2 years, or 4 years when the end date is uncertain, with up to 3 renewals.

Probation is 90 days for most open-ended roles, 180 days for technical or senior roles and first-job seekers, and 240 days for management. For fixed-term contracts it is 15 or 30 days. The probation period must be agreed in writing, otherwise none applies.

Working hours

Normal working time is up to 8 hours a day and 40 hours a week under the Labour Code, and some sector agreements set a shorter week. Overtime is limited to 2 hours on a normal working day and, per year, to 175 hours in micro and small companies or 150 hours in medium and large companies. A collective agreement can raise the yearly cap to 200 hours.

For the first 100 overtime hours a year, the supplement is 25% for the first hour and 37.5% for each further hour on a working day, and 50% per hour on a rest day or public holiday. Above 100 hours a year it rises to 50% and 75% on working days and 100% on rest days and public holidays. Employees are entitled to 11 hours' rest between working days, a weekly rest day and the right to disconnect outside working hours.

Holiday

Employees get at least 22 working days of paid holiday a year, plus 13 national public holidays and a local municipal holiday. On top of holiday pay they receive a holiday subsidy worth one month's pay before the holiday starts, and a Christmas subsidy worth one month's pay by 15 December. Both can be paid in monthly twelfths if agreed.

Parental leave

Parental benefit is paid by Social Security, not the employer: 120 days at 100% or 150 days at 80% of reference pay, with 30 more days when the parents share the leave. The mother must take 42 days and the father 28 days, plus 7 optional days at 100%.

Sick pay also comes from Social Security, from the fourth day of certified sickness, at 55% to 75% of reference pay depending on how long the absence lasts.

Notice and termination

Portugal has no at-will dismissal. An employer can only dismiss for a lawful reason, such as just cause after a disciplinary process, redundancy of the position, collective dismissal or unsuitability, and each route has its own procedure. Severance for redundancy and other objective dismissals is 14 days of base pay plus seniority allowances per full year of service from 1 May 2023. Earlier service counts at the older rates, and the total is capped.

For these dismissals the employer gives notice by length of service: 15 days up to 1 year, 30 days from 1 to 5 years, 60 days from 5 to 10 years and 75 days after 10 years. Employees who resign give 30 days' notice, or 60 days after 2 years. Pregnant workers and parents on leave have extra protection.

Work permits

Citizens of the EU, the EEA and Switzerland can work in Portugal without a permit and register their residence after three months. Everyone else needs a residence visa based on an employment contract. AIMA has a legal deadline of 90 days, extendable by 30, but waits are often longer in practice, so plan the start date with that in mind. We confirm the right route for each hire.