Portugal: sanctions for companies making excessive use of fixed-term employment contracts

Portugal’s Parliamentary Working Group for reform of the country’s labor code has voted in favor of the principle of sanctions to be levied for companies’ excessive use of fixed-term employment contracts. An additional payment of up to 2% of fixed-term employment related payroll could be levied on companies observed to be systematically making use of this type of employment contract. This new tax would only apply when the number of contracts exceeded the relevant sector average. This measure termed ‘excessive rotation’ could apply to all sectors by the end of 2019, once confirmed by Portugal’s Parliamentary Social Affairs Committee.