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COVID-19: Extraordinary Incentive for Business Regularization

New Legislation Enacted

Authors: Ricardo Grilo, Senior Associate and Gonçalo Machado dos Santos, Associate – Garrigues Portugal SLP Sucursal

Ordinance no. 170-A/2020 of July 13 has been approved and regulates the attribution of financial support to companies during the returning phase of its employees to normal work provision and normalization of business activity. This incentive aims to support the maintenance of employment and to reduce the risks of unemployment for employees working for companies affected by the business crisis as a result of the pandemic caused by the COVID-19. Therefore, companies which have benefited from the measures provided for in Decree-Law no. 10-G/2020, of March 26, may accede the extraordinary incentive for the normalization of business activity: (1) Extraordinary support for the maintenance of employment contracts (simplified layoff); AND (2) Extraordinary training plan.

The award of this incentive gives rise to the following obligations: (1) Companies accessing this incentive will not be able to proceed with redundancy based terminations (individual or collective redundancies and dismissal caused by inadaptability), nor will they be able to initiate the corresponding procedures as set out in articles 359, 367 and 373 of the Portuguese Labor Code; and (2) Companies accessing the extraordinary incentive in the amount of Euros 1.270,00 (corresponding to two minimum monthly wages) shall have to maintain the same level of employment as that which existed in the last month of implementation of the measures concerning the extraordinary support for the maintenance of employment contracts (simplified layoff) or the extraordinary training plan.

Remote Work Regime as Contingency Measure

New Legislation Enacted

Authors: Ricardo Grilo, Senior Associate and Gonçalo Machado dos Santos, Associate – Garrigues Portugal SLP Sucursal

The Portuguese Official Gazette (Diário da República) published the Resolution of the Council of Ministers nº 70-A/2020, of September 11, which declares the contingency situation throughout national mainland territory and orders the adoption and, in some cases, the renewal of exceptional measures for combatting COVID-19. These measures include changes in the remote work regime and how work is organized.

Although the remote work regime continues to depend on agreements between the parties, it is mandatory (independently of any agreement) if the job duties, together with the physical space and organization of the work, do not allow compliance with the public health guidelines if all employees worked on site. When choosing which employees should do remote work or work on site, companies should rely on objective, measurable and nondiscriminatory criteria. Where remote work regime is not adopted, within the maximum limits of the normal work period and respecting the right to daily and weekly rest established by law or in the applicable collective bargaining agreement, companies should implement measures for the prevention and mitigation of risks.

Renewal of Labor Measures as Part of Contingency Situation

New Legislation Enacted

Authors: Ricardo Grilo, Senior Associate and Gonçalo Machado dos Santos, Associate – Garrigues Portugal SLP Sucursal

The Portuguese Official Gazette (Diário da República) published the Resolution of the Council of Ministers No. 81/2020 of September 29, which has renewed the declaration of the contingency situation throughout Portuguese territory. Therefore, all exceptional measures that were introduced by the Resolution of the Council of Ministers No. 70-A/2020 of September 11 remain in force and are extended through October 14, 2020.

Exceptional and Temporary Work Reorganization to Minimize Risks of Transmission

New Legislation Enacted

Authors: Ricardo Grilo, Senior Associate and Gonçalo Machado dos Santos, Associate – Garrigues Portugal SLP Sucursal

Decree-Law No. 79-A/2020, of October 1, published in the Portuguese Official Gazette (Diário da República) establishes an exceptional and temporary regime of work reorganization and minimization of risks of COVID-19 transmission. Among other things, the regime applies to companies with workplaces with 50 or more employees, in the territorial areas where the epidemiological situation so justifies, as defined by the Government through a Resolution of the Council of Ministers. Covered employers must organize the hours of entry and exit from the workplace in a delayed manner, guaranteeing minimum intervals of 30 minutes (up to 1 hour) between groups of employees.

Additionally, the employer shall adopt technical and organizational measures aiming to ensure the physical distance and protection of employees (as has been done by many companies, as a way to combat this pandemic). To meet this obligation, employers may modify rest breaks, implement telework regime, among other changes. Employers must follow various procedures, including consulting with the workers’ council or union delegates, before implementing changes to work schedule.