Portugal: COVID-19 Employment Support Measures

Employers subject to implementing contingency plans and employee health protection measures

All businesses and organisations in the private, public, cooperative and social sectors have been required to create contingency plans along with workplace health protection measures, and to make them available (affixed at the workplace) to all employees, to conform with the guidelines issued by the national health authority.

Workplace Health Services play an active role in responding to the pandemic within companies, in particular: (i) ensuring employees are informed and trained; (ii) defining additional prevention measures which prove necessary; (iii) ensuring medical surveillance; and (iv) identifying cases of infection.

These are expected to be subject to additional provisions and measures once the country initiates a stage of gradually returning to the workplace, mainly as of the beginning of May.

In early April, the government issued specific guidelines on the use of Personal Protective Equipment (PPE) by certain groups of professionals for specific activities (in addition to health professionals). Compliance is mandatory for businesses actively engaged in enterprises which fall within the purview of these activities. These mandatory guidelines also apply to proprietors who recruit professionals tasked with delivering essential goods to homes (as far as private employers are concerned, these include, for example, external hospital maintenance professionals, employees and volunteers) and/or enlist customer care professionals to work as tellers or to operate customer service desks, when it is not possible to install an (acrylic) partition or physical barrier.

Mandatory Remote Work (whenever compatible with the tasks performed)

The current pandemic has made teleworking mandatory as of 18 March, regardless of the employment relationship, provided that the tasks allow it. This measure will apply, at least until 2 May.

COVID-19 Emergency Lay-off

One of the most important provisions to come out of the exceptional measures legislated in late March (then revised and regulated in April) was a simplified lay-off procedure allowing employers confronted with sharp and unforeseen reductions in economic activity, as well as those who were required to (temporarily) close their business, to i) reduce their employees’ normal working hours; or ii) suspend the employment contracts. Employers may thereafter seek to access and make use of public financial support.

Companies may resort to the above measures when faced with a crisis resulting from:

• Full or partial business halt, resulting from a global supply chain interruption;
• Full or partial business halt caused by suspension or cancellation of orders or bookings (where the use of the company or premises, production or occupation capacity, is reduced by more than 40%);
• Abrupt and significant fall of at least 40% in the company turnover (in the previous 30 days prior).

Employees whose contracts are suspended under this measure will receive a global compensation, in lieu of pay, of an amount equivalent to 2/3 of his/her previous regular salary (subject to minimum and maximum amounts) paid by the companies who, in turn, are granted State aid (social security allowance) equivalent to 70% of such amount.

Employees whose working time is reduced will see their remunerations reduced proportionally and, if such reduced remuneration falls under 2/3 of their previous regular salary, will receive an additional allowance (paid by employer) to guarantee a total amount that is at least equivalent to that paid to employees whose contracts are suspended; 70% of this allowance will be borne by public aid.

Additionally, employers will be exempt from paying social security contributions over the above amounts (which would normally generate an employer contribution equivalent to 23,75% of the amount paid).

Measures may be applied for one-month periods, renewable for up to three months (although the government has already indicated that this may be an objective of other rules granting further extensions, in the future).

These measures are intended to preserve jobs. Employers who have applied to receive the benefits afforded by these initiatives are not allowed to proceed with redundancy measures, while undergoing a lay-off situation, and throughout a two-month period following the end of the measures and public aid.

Employers resorting to these measures may also apply for an extraordinary financial incentive to support normalisation of business activities, in the form of a one-time allowance (of € 635) per employee.

For more information on these articles or any other issues involving labour and employment matters in Portugal, please contact Helena Tapp Barroso (Partner) or Pedro Pardal Goulã (Partner) of Morais Leitão at htb@mlgts.pt or pgoulao@mlgts.pt or visit www.mlgts.pt.

For more information please contact Joseph Granato, Communications Manager at L&E Global at joseph.granato@leglobal.org.