[Portugal] Labour market safeguards for young workers and interns

With the introduction of a new law, Portugal’s government hopes to protect young people in the job market by reducing the number of short-term contract renewals, increasing overtime and redundancy benefits, and ensuring minimum pay levels for interns, BollyInside reports.

The ruling centre-left Socialists have a majority in parliament, meaning the law - which includes 70 new labour regulations - should be reportedly adopted in time for it to take effect on January 1. 

Portugal’s unemployment rate fell to 5.9 per cent in the first quarter, the lowest in 20 years, but the number of insecure positions is among the highest in Europe and youth unemployment has stayed above 20 per cent.

Companies will only be able to renew temporary contracts four times in a row - reduced from the six times currently permitted - before the workers must become fully employed. The bill stipulates that workers with unlicensed temporary employment firms, such as those hiring seasonal staff, will be automatically integrated as staff of their actual employer. 

Companies will be barred from paying interns less than 80 per cent of the minimum wage - currently 705 euros ($756) per month - and there will be additional overtime pay for those who reach 120 extra hours per year. Severance compensation will rise to an equivalent of 24 days of paid work for each year of employment from 18 days now.

Labour Minister Ana Mendes Godinho said 62 per cent of young people who work had precarious short-term temporary contracts, compared to the EU average of 49 per cent. In 2021, eight out of 10 new contracts were short-term or entailed services for third parties such as delivery apps, without permanent labour links. 

Ms Mendes Godinho reportedly said the legislation would combat the “abusive use of temporary work and unprotected work”. “We want to send a strong message to young people: Portugal values them, we want to attract and retain talent.”

Source: BollyInside

(Quote via original reporting)

With the introduction of a new law, Portugal’s government hopes to protect young people in the job market by reducing the number of short-term contract renewals, increasing overtime and redundancy benefits, and ensuring minimum pay levels for interns, BollyInside reports.

The ruling centre-left Socialists have a majority in parliament, meaning the law - which includes 70 new labour regulations - should be reportedly adopted in time for it to take effect on January 1. 

Portugal’s unemployment rate fell to 5.9 per cent in the first quarter, the lowest in 20 years, but the number of insecure positions is among the highest in Europe and youth unemployment has stayed above 20 per cent.

Companies will only be able to renew temporary contracts four times in a row - reduced from the six times currently permitted - before the workers must become fully employed. The bill stipulates that workers with unlicensed temporary employment firms, such as those hiring seasonal staff, will be automatically integrated as staff of their actual employer. 

Companies will be barred from paying interns less than 80 per cent of the minimum wage - currently 705 euros ($756) per month - and there will be additional overtime pay for those who reach 120 extra hours per year. Severance compensation will rise to an equivalent of 24 days of paid work for each year of employment from 18 days now.

Labour Minister Ana Mendes Godinho said 62 per cent of young people who work had precarious short-term temporary contracts, compared to the EU average of 49 per cent. In 2021, eight out of 10 new contracts were short-term or entailed services for third parties such as delivery apps, without permanent labour links. 

Ms Mendes Godinho reportedly said the legislation would combat the “abusive use of temporary work and unprotected work”. “We want to send a strong message to young people: Portugal values them, we want to attract and retain talent.”

Source: BollyInside

(Quote via original reporting)