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Portugal 2022
Day Date Holiday Notes
Saturday Jan-1 New Year's
Friday Apr-15 Good Friday
Sunday Apr-4 Easter Sunday
Monday Apr-25 Liberation Day
Sunday May-1 Labor Day
Friday Jun-10 National Day
Thursday Jun-16 Corpus Christi
Monday Aug-15 Assumption Day
Wednesday Oct-5 Republic Day
Tuesday Nov-1 All Saints Day
Thursday Dec-1 Restoration of Independence
Thursday Dec-8 Immaculate Conception
Sunday Dec-25 Christmas
Countrypedia

Portugal
Payroll and Benefits Guide

Last updated: Mar 14, 2022
Currency
Euro (EUR)
Payroll Frequency
Monthly
Employer Taxes
26.50%

Papaya Offers Complete Payroll, PEO and Contractor Management Services For Portugal

Download PDF Version

Overview

Capital
Lisbon
Currency
Euro (EUR)
Date Format
dd/mm/yyyy
Fiscal Year
1 January- 31 December

COVID-19

Due to COVID-19, Portugal has made several changes in the labor code to accommodate the current situation:

  • Telework- Telework in Portugal is usually something that is agreed on by both employee and employer. Due to COVID-19, telework is now mandatory when:
    • An employee is certified as a person who is immunocompromised
    • Disabled and is considered at least 60% incapacitated
    • Children under 12 years of age who have experienced disruptions with school closures.  One parent is able to request telework.
    • When an employee is able to conduct their work outside of their workplace
  • Collective bargaining agreements may set daily or weekly telework rotations, work schedules, and even schedule lunch breaks.

Contributions

Employer

Employer Payroll Contributions

23.75%

Social Security

1.75%

Labor Accident Insurance

1.00%

WGF (wage guarantee fund)

26.50% Total Employment Cost

Employee

Employee Payroll Contributions

11.00%

Social Security

11.00% Total Employee Cost

Employee Income Tax

14.50%

up to 7,116.00 EUR

23.00%

7,116.01 EUR to 10,736.00 EUR

26.50%

10,736.01 EUR to 15,216.00 EUR

28.50%

15,216.01 EUR to 19,696.00 EUR

35.00%

19,696.01 EUR to 25,076.00 EUR

37.00%

25,076.01 EUR to 36,757.00 EUR

43.50%

36,757.01 EUR to 48,033.00 EUR

45.00%

48,033.01 EUR to 75,009.00 EUR

48.00%

75,009.01 EUR and above

Payroll

Payroll Cycle

The payroll cycle in Portugal is generally a monthly cycle, with wages paid before the last day of each month.

13th Salary

There are mandatory 13th and 14th salary payments in Portugal, which are paid out in June, for Holidays, and December, for Christmas. 

Working Hours

General

The standard working hours in Portugal are 40 hours per week, 8 hours per day. 

The maximum weekly and daily working hours can differ as stipulated in employment contract /collective bargaining agreements. 

In 2022 significant changes in the remote working regime have been implemented, the most significant being that employers must have a written agreement in place if they want to enact remote work, and if there are 10 or more employees, the employees with children up to 8 years old are entitled to work under a remote work regime, (job and employer permitting) 

In addition, there is a new rule on contact outside of working hours whereby employers must refrain from contacting employees during their rest period, except in the case of force majeure.   

Overtime

All work more than the standard 40 hours a week is to be paid as overtime and is regulated by the employment contract/collective agreements.  In general, overtime maximum limits are set weekly as 2 hours per day up to a maximum of 48 hours per week, and annually, as 150 hours per year for employees of a company with more than fifty employees, and 175 hours per year for companies with less than fifty employees.  As stipulated in employment contract/collective bargaining agreements, the maximum daily, weekly, and annual overtime hours can differ.  

Overtime payments are calculated as 125.00% of the usual salary rate for the first hour of overtime, increasing to 137.50% per hour for subsequent hours worked. Overtime worked on rest days/holidays is paid at 150.00% of the usual salary rate. 

Working Week

Monday-Friday

Leave

Paid Time Off

Paid leave in Portugal is set in the employment contract as a minimum of 22 days paid holiday a year, following completion of 1-year service, in addition to public holidays.  

All paid time off requests must be applied for before the start of the leave and approved by the employer. The leave can be carried forward into the next year but must be used by 30th April. 

During the first year of employment, an employee is entitled to 20 days of leave, accumulated as two days per month.  If the employment starts in the first half of the year, the employee is entitled to eight days of vacation after completing 60 days of work, and if the calendar year ends before six months has been completed, the days are extended until 30th June the following year. 

Public Holidays

Portugal has 13 mandatory public holidays.

Sick Days

All employees with at least six months’ service are entitled to 370 days of paid sick leave per year and must provide a medical certificate within 48 hours of the first day of sickness.   

The sick pay is paid by the employer for the first three days at a rate of 89.00% of the usual salary rate, then by the Social Security as follows: 

  • 55.00% of the average salary rate of pay for the next 30 days 
  • 60.00% of the average salary rate of pay between 31 and 90 days 
  • 70.00% of the average salary rate of pay between 91 and 365 days 
  • 75.00% of the average salary rate of pay between up to 366 days 

Maternity Leave

Eligible expectant mothers are entitled to 100.00% of their usual salary rate, paid for by Social Security for 120 days.  For an employee to be eligible, they must have been employed for at least 80 days of the preceding 12 months before the expected due date. 

Parental leave is granted for the birth of a child under Portuguese law, which may be shared between both parents (in which case the total parental leave period may be 180 days and paid at 83.00% of the usual salary rate of pay. The mother is entitled to 30 days of parental leave before delivery and a minimum of six weeks following the birth. 

 

Paternity Leave

Compulsory leave for fathers has increased from 15 days to 20 days, and optional paternity leave has decreased from 20 days to five days. Fathers must take paternity leave within six weeks of the child’s birth and use at least five days’ leave immediately after the birth. The leave can be taken as a single period or in a series of days.  

This leave is paid by social security at 100.00% of the employees’ average salary in the last six months. 

Parental Leave

After the required six weeks of maternity leave and 20 days of paternity leave, the couple can decide who takes the next 78 or 108 days. If the couple takes a total of 150 days, the leave is 80.00% paid, and if they choose 120 days, they will receive 100.00%. 

Other Leave

In Portugal, employees are entitled to up to 5 consecutive days of paid leave in the case of a family bereavement.  

Employees are also entitled to 30 days of paid leave per year to provide urgent and essential care for a family member younger than 12 and 15 days for an older family member. 

In the case of an employee getting married, the employees are entitled to 15 consecutive days of paid leave. 

Termination

Termination Process

The termination process is standard in Portugal, with notice periods required unless an employer can provide sufficient cause for dismissal without notice, usually due to misconduct or disobedience. The lack of notice of termination must be in writing and sent to the relevant service under the Ministry of Labour, except in discipline dismissal. 

Notice Period

In general, notice periods in Portugal are stipulated within the employment contract/collective agreement and are linked to the employee’s length of service, as below: 

  • Seven days’ notice if employed less than six months service   
  • One month notice if employed between 6 months & 48 months                         
  • Two months’ notice if employed for more than two years                                                

Severance Pay

Severance pay in Portugal depends on several factors, including the terms of the employment contract, the position/role of the employee, and the reason for termination. 

The minimum amount of severance pay due (if applicable) is 18 days of the usual salary rate for the first three years of service and 12 days’ salary for each subsequent year of service. 

Probation Period

Portugal’s probation period for permanent employees is 90 days, 180 days for high technical/complexity roles, and 240 days for management, directorate, and equivalent responsibility roles. Fixed and unfixed term temporary contracts are subject to shorter probation periods. 

 

VISA

VISA

Any foreigners coming to work in Portugal for longer than six months need a Residence Certificate (Certificado de Registo). Most non-EU nationals will also need a Portuguese work permit before they can undertake employment in Portugal. In most cases, a Portuguese work permit is only granted when a job offer is confirmed, and once approved, they can continue the process of obtaining a Portuguese work visa or residence permit.  After five years of residence in Portugal, you can claim Portuguese permanent residence, and after six years, Portuguese citizenship.  

Portugal has quotas to limit the number of jobs that go to third-country nationals to improve employment opportunities for EU nationals. Most jobs need to be advertised to Portuguese and EU/EFTA citizens for 30 days before the Institute for Employment and Vocational Training in Portugal (IEFP) will classify them as jobs that non-EU employees can freely fill. 

VAT

General

The standard rates of VAT in Portugal are 23.00% in Continental Portugal, in Azores, it is 18.00% and in Madeira, it is 22.00% 

Version History

March 14, 2022
Compulsory leave for fathers has increased from 15 days to 20 days.
The National Minimum Wage in Portugal is now 705 EUR per month.
Stay up to date on payroll & employment law changes

Questions & Answers

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P. Dawson
P. Dawson
1 year ago

Hi, was wondering if there have been any changes regarding unemployment due to covid-19?

Francesco
Francesco
1 year ago

Hello,
I may be starting a 2 year contract in Portugal soon, from 1st June 2021 to 30th May 2023. Should I expect/ask for the holiday payment (13th salary instalment) be made in my first month of employment this June?

Adnan
Adnan
1 year ago
Reply to  Erez Greenberg

Hi
Could you please tell me if my employer can keep 13th , 14th months salaries and my food cost in my basic salary ? As I know that the basic salary in Portugal is 665 euro monthly and food cost , 13th & 14th month salary should be added with amount of 665 euro but I noticed my employer calculated the following way
My salary at my work : 700 euro
In this 700 euro my employer keep food cost and 1/12 of 13th and 14th month salary
So it means my basic salary goes below 665 euro. Is not breaking the law ?
As I understand that if employer pay me for food and 1/12 of 13th and 14 then it should be like 700 euro + food cost + 1/12 of 13th and 14th month salaries and equal should be around 800 euro.
Does by employer has right to keep my 13th and 14th month salaries and food cost in the basic salary ?
I’m looking forward to hearing from you. Thank you so much

Zoe
Zoe
7 months ago
Reply to  Erez Greenberg

Hi Erez, could you please share the article of law stating that 13th and 14th-month salaries are mandatory in Portugal and that they can be paid in the two ways you mention?
Thanks a million,
Zoe

João C.
João C.
1 year ago

Hi there,

Are you sure about those Employee taxes you mention? Are there different taxes IF the company is international?
According to this document, the taxes are different: https://s.economias.pt/docs/tabelas_irs_2021.pdf

Thanks,
João

Richmond M.
Richmond M.
1 year ago

How often do you have to conduct skill development training? 

Emily Kuhnert
Admin
1 year ago
Reply to  Richmond M.

Hi, skills development training should happen at least once a year or can be split up into several training events. |Alternatively, an employee should be granted time off to attend training outside of your organization. Each employee is required to receive a minimum of 35 hours of training per year with exception to fixed-term contracts of less than 3 months.

Chris
Chris
8 months ago
Reply to  Emily Kuhnert

Hi Emily, thanks for this information. I try to get this opportunity in my company. Do you know what is the law behind so that I can have an argument?

Emily Kuhnert
Admin
8 months ago
Reply to  Chris

Hi Chris, the labor code is “Código do Trabalho; Lei n.º 105/2009, de 14 Setembro, alterado pela Lei 93/2019 de 4 de Setembro.”

Anonymous
Anonymous
1 year ago

Hi,
Just wanted to ask how much social security tax (in cash or percentage) should an employee pay, who is working as a domestic worker with a contract of €750 per month ? Cause I heard that the domestic tax is less.

Would greatly appreciate it.

Thanks.

Emily Kuhnert
Admin
1 year ago
Reply to  Anonymous

Hi, thank you for your question. Unfortunately, this is out of the scope of information we are able to offer. I would suggest checking out Portugal’s Tax Authority website https://www.portaldasfinancas.gov.pt/at/html/index.html.

Mohamed Ali Mezni
Mohamed Ali Mezni
1 year ago

Hi i’m going to be working at portugal with a salary of 1250 gross i was wondering can someone tell me what’s the net amount ? and will it be enough for me to live in there ? and thank you!

Emily Kuhnert
Admin
1 year ago

Hey Mohamed, thank you for your question. You can find the employee taxes at the top of the page and can get a rough estimation of your net salary.

Joy Myers
Joy Myers
1 year ago

What are the number of time off days that can rollover to the next calendar year? When do the days from the previous year need to be used?

Admin
1 year ago
Reply to  Joy Myers

Hi Joy, in Portugal, employees are entitled to at least 22 days of annual leave, and possibly more depending on collective bargaining agreements. If they don’t use all of those days in the calendar year in which they were earned, they can be used in the following year until April 30. However, no more than 30 days of leave can be taken in any given calendar year.

Paul
Paul
1 year ago

Do employment contracts have to be written in Portuguese to be legally binding?

Admin
1 year ago
Reply to  Paul

Hi Paul, contracts do not have to be in Portuguese in order to be legal, but they do have to be in a language that both parties (employer and employee) understand. It is also a good idea to have a Portuguese translation for both parties so that neither party could claim that they misunderstood the original.

Christopher Deaton
Christopher Deaton
1 year ago

Hi, must a Portugal software development industry employer, with less than 50 full-time employees, all working remotely during COVID-19, pay the employee for time off to get a COVID-19 vaccination?

OP DE beeck bART
OP DE beeck bART
1 year ago

Can we give a net fixed amount extra when peole work at home?

Emily Kuhnert
Admin
1 year ago

Hi, thank you for your question. This is possible, however, you would have to calculate the gross amount first.

Ivan
Ivan
11 months ago

Is it possible for you to hire a non-EU, Portuguese resident via a non-Portuguese entity? (Citizen of Russia, moved to Portugal on a Digital Nomad/Remote work visa D7 that comes with work authorization.)

Emily Kuhnert
Admin
11 months ago
Reply to  Ivan

Hi Ivan, there shouldn’t be any limitations on hiring a foreigner so long as they have obtained the right visas to be able to work. Any employing entity must report the hiring of a foreign worker to the Autoridade para as Condições do Trabalho (ACT) (Work Conditions Authority).

Chandrashekar
Chandrashekar
10 months ago

I joined in October, should I receive Christmas allowance in December (additional one month full salary)

Emily Kuhnert
Admin
10 months ago
Reply to  Chandrashekar

Hi, the 13th salary you will receive will be prorated from your start date, you will not receive the full amount as you have yet to complete a full year of employment.

Carolyn
Carolyn
9 months ago

Hi, I was wondering if an employee quits, does she get paid for unused vacation time? For example, if the employee gives notice on January 1st, does she get paid for 22 days of vacation for that year?

Emily Kuhnert
Admin
9 months ago
Reply to  Carolyn

Hi Carolyn, thank you for your question. In Portugal, leave is accrued based on a monthly basis and not given as a lump amount to be used throughout the year. The only leave that would need to be paid out if an employee resigns would be any unused leave that has already been accrued.

Carolyn
Carolyn
9 months ago
Reply to  Emily Kuhnert

Thanks for your response! I have a related question: if an employee takes multiple weeks of leave in January and then quits in February, does the employee have to pay the company for the leave they took that was not accrued yet?

Emily Kuhnert
Admin
9 months ago
Reply to  Carolyn

Hi Carolyn, my pleasure. If an employee takes multiple weeks of leave and then quits, then the negative leave balance is settled upon termination in the final payslip, usually as a deduction.

Andy
Andy
8 months ago

Hi, regarding this point “If the employment starts in the first half of the year, the employee is entitled to eight days of vacation after completing 60 days of work, and if the calendar year ends before six months has been completed, the days are extended until 30th June the following year.”

Could you confirm if the 8 days are applicable after 60 days or 6 months of employment?
Thank you!

Emily Kuhnert
Admin
8 months ago
Reply to  Andy

Hi Andy, you are entitled to 8 days of vacation after 60 days of work if the you have started in the first half of the year (January–June).

Andy
Andy
8 months ago
Reply to  Emily Kuhnert

Thanks! Just a follow-up question, are those 60 days working days or consecutive (2 months)?

Emily Kuhnert
Admin
8 months ago
Reply to  Andy

Working days

Lana
Lana
8 months ago

Hi, I have a question. Do Portuguese payslip need to be itemized? So all additions and deductions separately from the base salary? Or can an employer lower the base salary itself because of, for example, sick days?

Emily Kuhnert
Admin
8 months ago
Reply to  Lana

Hi Lana, thank you for your question. In short, yes, your employer is required to give you a breakdown of your salary remuneration. You can find a sample here https://papayaglobal.com/blog/portuguese-payslip-explained. Sick leave is paid at a different rate than your regular pay rate (a medical certificate must be submitted to your employer within 48 hours of being sick). Please see the sick leave section on this page for more information.

syed imran hussain
syed imran hussain
7 months ago

do i get anything if i resigin from my job,i worked in my company for more than 2 years

Emily Kuhnert
Admin
7 months ago

Hi Syed, if you resigned, you are not entitled to any kind of compensation. Please also note that if you resign without giving notice, you may be liable for paying your employer indemnity equal to the basic salary for the days that would have been your notice period.

M. van de Vusse
M. van de Vusse
7 months ago

Hello, I was wondering if employees also offer unpaided leave due to academic reasons? I need one month of unpaid leave in order to finish my studies.

Nitish
Nitish
6 months ago

My consultant asking me to work in steel factory and offering me 800-900 a month. But i have a confusion because i heard in a youtube video that company in portugal will pay gross salary (800-900) + Food allowance (100) + House Rent Allowance (100) = 1000-1100. Am i right if not please correct me.

Decio pedrosa
Decio pedrosa
5 months ago

So if I start in April am I entitled to vacation pay in June or is it when my 6 months is up in October?

Chhabra
Chhabra
5 months ago

What is social security in payroll
of employer

Sultan
4 months ago

I am resigning after 1.5 years. What benefits am I entitled to receive from my company? I have given my company a notice period of 30 days. Please let me know.

Micha
Micha
4 months ago

Hi there, could you please tell me if an “insençao de horario” listed on my contract as a special remuneration to be paid 14 times a year, including holiday and Christmas allowance should be listed on my payslip separately and paid on top of my basic salary? When queried it didn’t appear to be paid, I was told it was included in my basic? Many thanks.

Micha
Micha
4 months ago
Reply to  Erez Greenberg

Hello and thank you for your reply. Should the insençao de horario be on a separate line as it is a payment for extra hours?

James
James
4 months ago

Hello, I’m resigning and still have 12 days of vacations left for this year. In this regard, I shall receive the allowance for the unused vacations, but using which formula? a) monthly salary / 30 days X 12 vacation days, or b) monthly salary / 22 days X 12 vacation days ? Appreciate it.

Emily Kuhnert
Admin
4 months ago
Reply to  James

Hi, you should receive your monthly salary plus 12 vacation days. Pay for vacation days is calculated based on your daily wages. Daily wage calculation is roughly one months’ salary divided by 21 days.

Anne
Anne
1 month ago

I’m resigning after 20 years and want to keep the mobile number I’ve had since 2007. At the time I was told it could be used for business and personal use and now it’d be very inconvenient to have to change it. My employer is saying the number belongs to her. Do I have any rights?

Bruno
Bruno
1 month ago

Hi All,

About 24×7 Shift Work , is there a fix shift allowance or % of Salary? Can anyone clarify the rules for Shift Work in Portugal?

Appreciated

Bruno
Bruno
1 month ago
Reply to  Erez Greenberg

Thank you Erez, really appreciated the detail.

Egle
Egle
1 month ago

If an employee needs to have a business trip abroad what regulations should an employer folllow?

Laren
Laren
1 month ago

Hi, regarding the 13th and 14th-month salaries in Portugal. I understand that there are 2 ways in which it can be paid. However, are there any tax implications for choosing for it to be paid in June and December versus paid in twelves (1/12) each month along with the base salary. Thanks.

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