According to Gartner, Portugal is listed among the top seven leading countries providing technology-based services for the fifth time in a row. Learn how your company can benefit from using an EOR provider to hire in Portugal
Portugal has been a top destination for both tech talent and hiring organizations for the last few years. Vastly because of its unique work and cultural environments. Great tech talent, high English language proficiency, timezone compatibility, open working culture, affordable costs, and excellent safety and stability conditions play a big role as well.
Hiring in Portugal
Portugal’s modern economy has undergone several development stages. Today Portugal is famous for its beaches, food, and the reputation of a tech mecca. At the moment, the IT sphere is one of the most promising sectors in this country. Reportedly, Portugal is one of the top competitors in providing IT outsourcing and IT staffing services globally.
Now, let’s go right to the bottom line of this article: what does it take to hire someone in Portugal?
First things first, when you decide to expand your company to Portugal, you’ll need to build a team. This includes arranging the recruitment process with local cultural and legal nuances in mind. Further on, when hiring staff on-site, you’ll have to stay compliant with employment laws. Hiring Portugal employees is simple if you’re following the country’s employment compliance laws thoroughly: from recruiting to onboarding and contract signing.
How do I avoid common pitfalls when hiring in Portugal?
When you are negotiating employment contract terms and offer with an employee in Portugal, it may be useful to keep the following in mind:
- Employment Contracts in Portugal
are recommended to be in a written form in Portugal. It should include the terms of:
– compensation
-benefits
-termination requirements.
An offer letter should always be in Portuguese and state the salary (and\or compensation amounts) in Euros.
- Bonus Payments in Portugal
Employees in Portugal receive the 13th and the 14th salary in June and December respectively.
- Portugal Working Hours
Forty hours per week is a standard working week in Portugal. Working days last from 9:00 to 19:00 with a two-hour lunch break.
- Vacation Benefits in Portugal
22 business days are mandatory for vacation time for employees in this country. 20 days if you are a first-year worker.
- Sick Leave in Portugal
Employees in Portugal receive 55-75% of their salary as a sick leave payment that can last up to 1.095 days.
- Maternity and Paternity Leave in Portugal
Mothers of the baby to come are entitled to 120 days of paid maternity leave They are obliged to take 30 days before the childbirth and at least 42 after.
- Termination and Severance Pay in Portugal
According to Portuguese law, an employment contract can be terminated based on three reasons: supervening impossibility, employee’s retirement, upon the contract term finale. Generally, the probationary period lasts 90 days. It can be grown to 240 if the position is highly technical or belongs to a senior executive. Termination notice should be sent 15 to 75 days ahead of the termination itself, depending on the time of the employee’s service.
- Portugal Tax
Portuguese employees are entitled to social security. 15% is usually subtracted from an employee’s salary, 23% is contributed by the employer.
- Health Insurance in Portugal
Basic health insurance is provided by the state in Portugal.
- Supplementary Benefits in Portugal
Many Portuguese employees are offered extended health insurance as well as car and meal provisions.
How to hire fast in Portugal?
As a global EOR provider, Acvian has deep expertise in Portuguese labor legislation and will help to hire talent swiftly and run payroll without setting up a legal entity (subsidiary) Our comprehensive solution and Global PEO service enable customers to run payroll in Portugal while HR services, tax, and compliance management matters are lifted from their shoulders onto ours. As a Global PEO expert, we manage employment contracts, statutory and market norm benefits, and employee expenses, as well as severance and termination if required. We also keep you apprised of changes to local employment laws in Portugal.
To get an estimate of what your next Portuguese hire is going to cost you, use Acvian Payroll Cost Estimator. To get a precise assessment of a particular prospect hire cost in Portugal, contact the Acvian team here.
