Basic Facts

Portugal, officially the Portuguese Republic, lies along the Atlantic coast of the Iberian Peninsula in southwestern Europe. It is the westernmost sovereign state of mainland Europe and is bordered by Spain. Its territory also includes the Atlantic archipelagos of the Azores and Madeira, both of which are autonomous regions with their regional governments. Portugal is a founding member of NATO and entered the European Communities (EC) – now the European Unions (EU) – in 1986. 


*Please note that the official currency is the currency of remuneration when employed through WorkMotion in Portugal.

Capital :
Currency :
Euro (€, EUR)
Languages spoken :
Population :
10.3 million (2021 est.)
Minimum wage 2022 :
€705 (monthly)
Cost of Living index :
$$$ (64 of 139 countries)
Payroll Frequency :
VAT - standard rate :
GDP - real growth rate :
4.9% (2021 est.)

Statutory Holidays

The national holidays mentioned below are valid for the year 2023.

Portugal has 13 mandatory holidays. In addition to the mandatory holidays, the Tuesday of Carnival and the municipal holiday of the locality can be observed as a holiday, declared by means of collective labor regulation or employment contract.

Holiday Name
Extra Information
January 1
New Year’s Day
April 7
Good Friday
Movable - Friday before Easter.
April 9
Movable - First Sunday after the first full moon following the northern spring equinox
April 25
Freedom Day
May 1
Labor Day
June 8
Corpus Christi
Movable - Thursday following Trinity Sunday, which is 60 days after Easter
June 10
Portugal Day
August 15
Assumption of Mary
October 5
Republic Implantation Day
November 1
All Saint’s Day
December 1
Restoration of Independence
December 8
Immaculate Conception Day
December 25
Christmas Day

Contract Sharing Time

The approximate time for sharing the contract with an employee in Portugal is 5 business days assuming no special requests or changes to our standard employment contract. Any such requests or changes would need to undergo internal and external review, directly leading to a time delay.

NOTE: This number is subject to change and is only an estimation of the Contract Sharing Time. The estimated Contract Sharing Time begins from the moment that WorkMotion has received all required information from both the client and the employee.

What You Need To Know

  • Salaries in Portugal are paid in 14 installments: 12 monthly wages plus two additional payments for Christmas and holiday allowances.
  • The employee is entitled to a Christmas allowance equal to one month’s pay, which must be paid by December 15 of each year.
  • The employee is entitled to a holiday allowance which must be paid before the start of the holiday period and proportionately in the case of interpolated holiday enjoyment.
  • Employers must reimburse all expenses incurred by employees due to working from home. WorkMotion provides €50 per month of work-from-home allowances, which are added on top of the gross salary.
  • Employers also must respect the employee’s privacy by not contacting them outside of working hours or using any image, sound, writing, or other means of control to monitor the employee’s work.
  • The employment contracts in Portugal are quite unique in that there are two types of fixed-term contracts – one with a specified end date and the other with an unspecified end date.

Labor Conditions

Working Hours

The normal working period cannot exceed eight hours a day and 40 hours a week.

Employers and employees may by agreement provide for an increase in the normal daily working period for up to two hours and the weekly working period for up to 50 hours, not counting the overtime work provided for reasons of force majeure. In a week whose working duration is less than 40 hours, the reduction may be up to two hours a day or, if agreed, in days or half days, without prejudice to the right to meal allowance.


Overtime can only be provided when the company has to deal with an eventual and transitory increase in work and there is no justification for the admission of a worker. Overtime may also be provided in case of force majeure or when it is essential to prevent or repair serious damage to the company or its viability.

Overtime work is subject to the following limits, per worker:

  • On a normal working day, two hours;
  • On a mandatory weekly rest day, or a public holiday, a number of hours equal to the normal daily work period;
  • In the case of a micro-enterprise or small enterprise: 175 hours per year;
  • In the case of medium or large companies: 150 hours per year.
Probation Period

Depending on the type of contract, the number of days vary. For a fixed-term contract, the probation period can be 15 days for a contract lasting less than six months or 30 days for a contract lasting six months or more. For a permanent contract, the probation period can last between 90 days to 240 days depending on the nature of the role. 

The probation period may also be shortened by collective labor regulations or by the written agreement of the parties. It may even be excluded by written agreement between the parties.

Termination Notice Period

Termination notice periods vary depending on the contract types, probation period length, contract length, and types of dismissal.

During Probation

Either party may terminate the contract without prior notice or compensation if the probation period does not exceed 60 days. If the probation period lasts longer than 60 days, the employer can terminate the contract of the following:

Probation Period Employer Notice
More than 60 days and up to 120 days 7 days
More than 120 days 15 days


After Probation

Employers’ notice periods vary between 15 and 75 days depending on the types of contract and causes of dismissal.

Employees can terminate a fixed-term contract with a just cause of the following:

Contract Length Employee Notice
Less than 6 months At least 15 days
At least 6 months At least 30 days


Employees can terminate a permanent contract without cause of the following:

Employment Length Termination Notice Period
Up to 2 years At least 30 days
More than 2 years At least 60 days


Leave / Time Off

Annual Leave

Every calendar year employees are entitled to 22 days of paid vacation. The period begins and ends on January 1, and vacations should be taken within this time slot, but they may be taken up until April 30.

Sick Leave

Employees can receive sick leave benefits from the fourth day of sickness from social security for up to 1,095 days, and for unlimited time in the case of tuberculosis. The employer usually pays the first three days of sick leave. The daily sick pay is between 55% to 75% of employees’ reference income depending on the length and nature of their sickness.

Parental Leave

All the parental leaves mentioned below are covered by Social Security.


Initial Parental Leave

Eligible mothers and fathers are entitled to a total of 120 or 150 days paid initial parental leave, at 100% or 80% of the salary, respectively. This leave is increased in certain conditions.


Maternity Leave

Within the initial parental leave, mothers must take a compulsory maternity leave of six weeks following childbirth, with an option of requesting a voluntary before childbirth of up to 30 days.


Paternity Leave

Within the initial parental leave, fathers must take compulsory paternity leave of 20 days after childbirth:

  • The first five days must be taken immediately after childbirth;
  • The other 15 days must be taken within six weeks following childbirth, consecutive or interpolated.

The father is also entitled to five optional business days, consecutive or interpolated, if taken simultaneously with the mother’s initial parental leave.


Extended Parental Leave

After the initial parental leave, parents may take an extended parental leave, for a period of three months each. Those extending the leave receive an extended parental allowance worth 25% of reference pay.

Adoption Leave

Prospective adopters adopting a child under age 15 are entitled to adoption leave of up to 120 or 150 consecutive days, at 100% or 80% of the salary, respectively. This leave is increased in certain conditions.

Other Types of Paid Leave

Type of Leave
Prenatal Leave
Pregnant employees are entitled to leave from work for prenatal consultations, for the time and number of times necessary.
Leave in a Situation of Clinical Risk during Pregnancy
A pregnant employee who is in a situation of clinical risk for herself or for her unborn child, and whose employer does not provide her with compatible work with her status and professional category, is entitled to a paid leave as deemed necessary.
Leave for Termination of Pregnancy
In case of termination of pregnancy, the worker is entitled to leave lasting between 14 and 30 days.
Leave to Care for a Child with a Disability, Chronic Illness or Cancer
Parents are entitled to leave for a period of up to six months, extendable up to four years, for the care of a child with a disability, chronic illness, or oncological disease.
Leave for Assisting Grandchildren
An employee may be absent for up to 30 consecutive days, following the birth of a grandchild who lives with him/her in a shared room and board and who is the child of an adolescent under the age of 16 years.
Marriage Leave
Employees are entitled to 15 consecutive days of unpaid leave for marriage.

Unpaid Leave

Leave for Sick Child

An employee shall be entitled to unpaid leave from work to provide unavoidable and essential assistance, to a child under the age of 12 or, regardless of age, to a child with a disability or chronic illness, up to 30 days a year or throughout the period of eventual hospitalization.

Child Care Leave

After the extended parental leave is exhausted, parents are entitled to consecutive or in parts unpaid childcare leave, up to a limit of two years.

Bereavement Leave

Employees shall be entitled to 20 consecutive days of unpaid leave following the death of their child. In the event of the death of a spouse or parent, the duration of paid leave shall be five consecutive days. 

Training Leave

The public employee is entitled to leave without pay for more than 60 days for training purposes.

Statutory Benefits

Social security contributions are made by both employers and employees, and cover sickness, occupational diseases, maternity, paternity, adoption, unemployment, disability, pension, and death.

Employers contribute up to 26.5%, while employees contribute 11%, broken down as follows:

Categories Employer Contributions Employee Contributions
Social Security 23.75% 11%
Labor Accident Insurance 1.75% (varies)
Wage Guarantee Fund 1%

Health Insurance

Portugal has state-sponsored free universal healthcare (Serviço Nacional de Saúde, SNS). Employers do not need to contribute additionally to health insurance besides the comprehensive total of 23.75%.

Other Insurances

Accident Insurance

The Labor Accident Insurance under Statutory Benefits covers all accident-related injury claims for employers. 

Unemployment Insurance

Unemployment benefits (Subsídio de desemprego) are cash benefits awarded to unemployed beneficiaries to compensate for the lack of remuneration caused by the involuntary loss of employment. Due to Covid-19, unemployment benefits ending in 2021 are, exceptionally, extended for another six months. 

Public Pension

In Portugal, old-age pension is paid to beneficiaries who have reached the state pension age. The age for retirement is 66 years and five months for both men and women. The pension amount is determined according to the beneficiary’s social security contribution record and registered earnings. 

Other Statutory Benefits

The following benefits are all covered by Portugal’s social security.


Disability Pension

It is an amount paid monthly, intended to protect beneficiaries of the general Social Security regime in situations of permanent incapacity for work. Disability is considered to be any disabling situation, of non-professional cause, which determines permanent incapacity for work.


Death Funeral Allowance

A one-time benefit, to compensate the applicant for the subsidy for expenses incurred with the funeral of any member of his household or any other person, including unborn children, as long as he resides in the national territory.


Widow’s Pension

Benefit granted monthly to the widower or person who lived in a situation of de facto union with the social pension pensioner.


The information contained in this Country Guide is provided for informational purposes only and should not be construed as legal advice on any subject matter. The contents of this Country Guide contain general information and may not reflect current legal developments or address your situation. You should not act or refrain from acting on the basis of any content included in this Country Guide without seeking the advice or representation of a licensed attorney. WorkMotion Software GmbH disclaims all liability for actions you take or fail to take based on any content included in this Country Guide.

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