Work and Wages

Minimum Wage

The minimum wage is fixed by Decree of the Council of Ministers based upon the proposal made by the Minister of Protection, Labour and Finance following the recommendations of the National Council of Social Dialogue, composed of worker, employer and government representatives. Wage rates may also be determined by collective agreement. The government may exclude workers covered by a collective agreement signed within the 6 months preceding the issue of the Decree fixing the minimum wage.

When establishing the minimum wage, Government considers the evolution of the national price index including the general national wage level as well as the social security benefits and the relative living standards of the social groups; and other economic factors, including the demands of economic development, the productivity levels and the necessity to reach and sustain a high level of employment. The determination of the minimum wage of part-time workers is based on the same formula used to set the hourly rate of payment of a full-time worker.

All workers, with a complete schedule are covered by minimum wage regulations. Nevertheless, the government may exclude workers covered by a collective agreement signed within the 6 months preceding the issue of the Decree fixing the minimum wage. The legislation allows for a combination of national, regional and sectoral minimum wages. There are in practice different minimum wage rates for agriculture; transport, services and process industry; and commerce and extraction industry.

Source: §161-165 of the General Labour Law (No. 7/15 of 15 June 2015)

Regular Pay

Wage consists of both the basic salary and any remuneration in kind, directly or indirectly paid in exchange of work. Wage can be fixed, variable or mixed. Fixed salary is the right or remuneration to the time when the work done over a period of time is irrespective of the outcome. The salary is variable remuneration or income when the work is done according to the results obtained in the period to which it relates. The salary is mixed when constituted by a fixed part and some other variable part. The variable salary can assume, namely the modalities of salary for piecework and commission when it regards only the work performed by the employee during the period considered without regard to the runtime; and salary for task when it meets the duration of work required to ensure a given production period.

Wage does not include travel allowances and facilities, transport allowance, the accidental and voluntary gratuities not related to performance of work, family allowance and all other benefits and social security benefits or their complements when paid by the employer.

Wages must be paid in cash at workplace, and partially in benefits (in-kind payment of wage) of other nature, including food, shelter and clothing. The non-payment of wages, if any, may not exceed 50% of the total. By agreement with the employee, payment is made in cash or (if provided for in internal regulation or collective agreement) by bank check, money order, bank transfer or deposit in the worker's current account. Salary is paid directly to the employee or the person indicated by him in writing, leaving the worker able to freely dispose off the wages preventing the employer from limiting that freedom in any way. Payment of wage in vouchers, coupons, credit account, debt statements or any other substitute method of payment in current currency is prohibited. Payment of wages in alcohol, drugs or harmful psychotropic substances is also prohibited.

Payment in kind is intended to satisfy personal needs of the worker or his family. Such payment is replaced by the corresponding value from. An employee may inform the employer within 15 days before the date of payment that you want the salary to be paid in cash only.

The employer is obliged to pay salaries every week, fortnight or month, and should be made until the last working day of the referring period, during work hours. The worker paid with an hourly or daily wage hired for a task of short duration, is paid for each day after completion of work. In the case of paid work by the piece or task, the payment is made after completion of each part or task, unless the execution lasts more than four weeks, in which case the employee must receive each week an advance of no less than 90% of the guaranteed minimum wage, with full payment of the difference calculated in the week following the conclusion of the piece or task. The commissions acquired during a quarter must be paid during the month following the end of that quarter. In case of termination of employment contract, the salary, damages and other amounts owed to the worker whatever they refer to, are paid within three days following the termination. Employees absent on the day of payment of wages can collect the amounts due, on the following day, within the normal business hours.

The employer must maintain payroll identifying the employer, the worker's full name, number of social security beneficiary, the period that corresponds to the payment, discrimination of amounts paid, all discounts and deductions, as well as the total net amount paid.

Deductions can be made from the salary of an employee in cases provided by the law. However, deductions or discounts cannot be made to the employer and his representatives for obtaining or maintaining employment.  

Source: §155, 156, 166-173 of the General Labour Law (No. 7/15 of 15 June 2015)

Regulations on Work and Wages

  • Lei Geral do Trabalho (n.º 7/15, de 15 de Junho de 2015) / General Labour Law (No. 7/15 of 15 June 2015)