Work and Wages

This page was last updated on: 2023-06-23

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 full time workers 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.

The Labour Inspectors  are the authority in charge of ensuring compliance with minimum wage related provisions, as well as other labour law provisions. 

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 to remuneration to the time spent doing work irrespective of the outcome. The salary is variable when remuneration or income refers to targets of work met by the worker in that period of time. The salary is mixed when formed 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 result of the work  performed by the employee during the period considered, without regard to the time the worker spent on it; and salary for task, when it refers to an amount of poduct to be obtained in a determined period of time.

Some payments made by the employer to the worker are not considered to be wage or part of it. They are travel allowances and facilities, transport allowance, aporadic and voluntary gratuities that are not related to performance of work, family allowance and all other  social security benefits or their accessories  when paid by the employer. Unless proven otherwise, all payments made by an employer to a worker that are periodical and regular are presumed to be wage.

Wages must be paid in cash at workplace, but may be partially paid in kind, by means of food, shelter and clothing. The -payment of wage in kind 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 of 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 and the value of the goods provided to the worker must equal their cost in the local markets Employees who are partially paid in kind may ask their employer to receive full payment in cash, doing so fifteen days before the due date of the next payment.

The employer is obliged to pay salaries every week, fortnight or month, and payment 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 each day, after completion of work. In case of work paid 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. When there is termination of employment contract, the salary, damages and other amounts owed to the worker whatever they refer to, are due 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.

Proof of payment is made by the worker to the employer by the means of a signed receipt for an individual worker, or a a payroll, kept by the employer,  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. If the worker accuses the employer of not performing the payments and the employer can present neither the receipt or a payroll like the one mentioned above, then the allegations are presumed to be true. Whenever the payment record does not refer expressly to those forms that are not considered wage, the records it contains are presumed to refer to the payment of wages.

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)

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