Limiting layoff pay. At this stage, the government hasn’t defined the limit and sent the case back for social dialogue. However, layoff pay can only be limited for labor contracts signed after the enforcement of the reform. The current labor code provides for a limit value in the event of a layoff: the equivalent of one month’s pay per year worked, within the framework of a collective layoff or following the removal of a position. The system apparently chosen resembles the Spanish system where the labor where the Labor Code limits severance pay to 12 months’ pay, which penalizes workers who have been in the company the longest. Labor Minister Helena André said the measures would help businesses cut costs in the event of a restructuring and, at the same time, and ensure that laid-off workers receive their benefits.
n resembles the Spanish system where the labor where the Labor Code limits severance pay to 12 months’ pay, which penalizes workers who have been in the company the longest. Labor Minister Helena André said the measures would help businesses cut costs in the event of a restructuring and, at the same time, and ensure that laid-off workers receive their benefits.
Businesses to create a layoff fund. The government is thinking about allowing businesses to create a fund aimed to pay severance pay.
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