Hire employees in Portugal
With Nomad Global Hire PEO / EOR services, you can easily hire employees in Portugal, without having to set up your own entity. No risk and fully compliant with HR support included
What to know about Portugal
Portugal is home to many Digital Nomads and Remote Talent
Employer Tax
Estimated at 28%
Currency
EUR, Euros
Available Employee Benefits
Medical insurance, Meal Vouchers
Employee Tax
Incremental up to 48%
Payroll Frequency
Monthly over 12 payments
Main Universities
University of Porto, University of Lisbon, NOVA University de Lisboa
Capital
Lisbon
Population
Circa 10.5 Millions
Available Contracts
Fixed Term Contract, Indefinite/Permanent
Portugal can pride itself on its dynamic startup scene as well as being a fantastic tourism destination and home to some of the best football players. WebSummit has been held in the Altice Arena since 2016 and had over 70,000 attendees in 2022. Portugal is home to a large community of Digital Nomads or Contractors who have embraced the remote working lifestyle for themselves and their families. Tech talents from all over Europe fill the streets of Lisbon. If you have found a great profile and are considering hiring talent locally, NOMAD GLOBAL HIRE will manage the local employment for your new employees, without the need to open your own entity.
Payroll, Benefits & Tax in Portugal
- Average salary in Portugal is 2,750 Euros Gross per Month
- Employer Tax in Portugal is usually 28%
- This includes Social Security and Unemployment insurance, but also Accident at work and Health
- Employee Tax in Poland is incremental from 14.5% up to 48%:
- There is a flat Tax rate amount of 14.5% up to 7,000 Euros
- Income Tax is at a flat rate of 25% for the income between 7,000 and 10,750 Euros of annual income
- Income Tax is at a flat rate of 28.5% for the income between 10,750 and 20,350 Euros of annual income
- Income Tax then steps up to 35%, 37%, 45% and finally 48% depending on the level of income
- Overtime in Portugal has to be paid by law and is limited to 2 hours per day and can be compensated up to 150% of the standard hourly rate of the employee
- Payroll Frequency in Portugal is Monthly over 12 months
- Maternity Leave in Portugal is up to 150 paid days. The Mother has to take at least 30 days before the birth date and the rest can be used in two different moment after the birth. During this time, leave is paid at by the Social Security Fund
- Paternity Leave is 28 days or about 6 weeks. The first 5 days have to be taken after the birth and the rest any time until the child turns 42 days old. The salary will also paid at 100% by the Social Security Fund
- Parental Leave is up to 120 days in Portugal
- Sick Leave is covered for up to 3 years! After the third day, the salary will be covered by the Social Security
- Statutory Leave in Portugal is 22 days minimum per year (20 days in the first year of employment)
- Bank holidays: there are 21 public days in 2023 in Portugal
- Termination can be done for Performance, Disciplinary reasons or redundancy, see below!
- Notice period is depending on the length of service of the employee
The Portuguese Labor Code is setting the framework for employment in Portugal. This covers all individual and collective working relationships, Compensation and Benefits, Workers rights as well as Leave (Sick, Parental), employment Termination and Discrimination.
Onboarding and Termination in Portugal
- Probation period are not mandatory under Portuguese Labour Law
- Probation period in Portugal however can be of a maximum of 3 months or 90 days, and therefor cannot be extended
- You can hire through Fixed Term Contracts, Indefinite / Permanent contract or BtoB contracts
- Employment Contracts are drafted in Portugal but can also be in English (but then has to be both at the same time)
- Termination is Portugal is generally a straightforward process and requires particular care to document every step. In order to be compliant, Termination can occur only because of Performance or disciplinary issues, or because of redundancy. Termination therefore usually occurs :
- By mutual agreement
- By resignation of the employee
- By expiration of contract
- By the employer on grounds of disciplinary dismissal, failure to perform, or reduction of work or end of the activity
- It is always advised to reach a Mutual Agreement to validate a Termination in Portugal, however it is not necessary by law
- Termination cannot occur if the employee is on any type of parental leave or if the employee is pregnant
- The minimum notice period in Portugal is 30 days minimum (for length of service of less than 2 years), then 60 days for service of over 2 years
- Notice periods in Probationary period are 0 days during the first 60 days of the probationary period and 7 days after that
- Severance payments in Portugal are mandatory and are based on the length of employment and type of contract. The severance is usually 12 to 18 days payment per years of service
Fixed Management Fee
We charge a fixed monthly fee depending on the level of the salary of the hired employee
- Local Contract Management
- Payroll Management
- Tax and Compliance
- HR Support
Employee Nomad set up fee
Everything to get you started on Nomad and ensure piece of mind for you and your new hire
- Sign up to the NOMAD Services
- Benefits Setup (if available)
- Tax authority liaisons
- An additional Deposit of 1 full month salary cost will be required
Estimated Employer tax costs
Employer Tax in Portugal is estimated around 28% (may vary depending on circumstances)
- Social Security
- Unemployment insurance
- Accident & Health
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