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Portugal is a country in the Iberian Peninsula located in southwestern Europe. Its territory also includes the archipelagos of the Azores and Madeira in the Atlantic. It features the westernmost point in continental Europe and shares a border with Spain. Portugal is a high-income, developed country with a bustling tech scene growing in Lisbon. The country's booming tech scene and growing startup ecosystem means many companies are now hiring talent in Portugal.
The minimum wage in Portugal is EUR 822 per month, based with a standard workweek of 40 hours at 8 hours per day. All work past the standard 40 hours each week is to be paid as overtime with maximum amounts of overtime allowed each year per employee based on the size of the company. Overtime is paid at 125% of the salary rate for the first hour and 137.50% for subsequent hours. Overtime on rest days or holidays is paid at 150% of the salary.
Pregnant employees who have been employed for 80 days in the past year are entitled to paid maternity leave of 120 days (of which at least 6 weeks need to be taken after the birth, and commonly 30 days before the birth). This leave is paid at 100% of the salary rate by Social Security. Fathers are entitled to 20 paid days of paternity leave, at least 5 of these days need to be taken consecutively.
After the minimum 6 weeks of maternity leave and 20 days of paternity leave are taken, the parents can decide who takes the rest of the leave (if they take 120 days total they will receive 100% of the salary, if they take 150 days the leave is paid at 80% of the salary).
Employees who have worked 6 months at their company are entitled to up to 1,095 days of sick pay at between 55-75% of the regular salary. This leave is covered by social security.
Portugal's paid leave includes 13 mandatory public holidays, and employees who have worked at their company for 1 year are also entitled to at least 22 days of paid time off each year. In the first year of employment the employee accrues about 2 days of paid leave per month.
Employees can also receive paid leave for bereavement, marriage, and to provide urgent care for a family member.
Portugal has a probationary period where an employment contract can be terminated without cause, this period is typically 90 days or 180 days for employees in technical positions. Fixed-term contracts may have a 15-day probationary period. After the probationary period, if the employer wants to terminate an employee they need to do so with just cause or provide a notice period.
Notice periods for termination in Portugal are usually linked to the employee’s length of service at the company:
Severance pay depends on the terms of the contract, the position/role of the employee, and the cause for termination. If the employee is not being terminated due to serious misconduct, negligence, theft, or something of that nature, a severance payment is due. The payment minimum is 18 days of wages per year for the first 3 years of service, and then 12 more days of wages for each year of service after that.
Portugal has mandatory 13th and 14th salary payments, each equal to 1 month of salary. These are paid out in June for the 13th month and December for the 14th month. Portugal also introduced their NHR Tax Benefit for non-habitual residents, an incentive that aims to attract foreign professionals to work in Portugal.
★ 23.75% - Social Security
★ 1.75% - Labor Accident Insurance
★ 1% - WGF (Wage Guarantee Fund)
You've sourced a full-time employee or contractor located in a country where your company is not incorporated.
Pass us the details of your candidate and we will let you know exactly what it costs to employ your candidate in that country.
Sit back and relax as we onboard your new team member and take care of all the local compliances and admin work.
It can be prohibitively expensive to establish an entity in every country you want to hire talent in, so Remofirst will hire and pay your employee on your behalf while you manage their daily duties. Remofirst will handle formal HR procedures and employment contracts that adhere to local laws, so that you can simply approve invoices via our platform. When you work with an Employer of Record (EOR) you can compliantly hire the best employees around the world.
Unlike full-time employees, contractors work on projects with multiple companies at a given time and are technically self-employed. Full-time employees are solely focused on their employer and usually receive benefits (such as health insurance, equity or stock options, and time off) as an additional form of compensation. While it can be cheaper to work with international contractors instead of paying benefits to a full-time employee, you run the risk of misclassification. It's recommended to work with an EOR for contractor onboarding and payments, so you can know that your international contractors are paid compliantly and on time.
