The Portuguese government has bolstered its legal arsenal to protect workers and businesses against the backdrop of the Covid-19 pandemic. As of 15 March, the Council of Ministers adopted a legislative decree which allowed companies struggling as a result of the health emergency to make use of lay-offs or partial unemployment. However there was a loophole in the text that made it possible for companies to resort to redundancies. Faced with outcry, the government enacted a new text on 26 March that better supervises the use of lay-offs and prohibits redundancies while companies are receiving aid. Similarly, Portugal’s working conditions authority (ACT) has seen the scope of its powers extended to carry out checks. Inspections began on 15 April 2020.
Ban on redundancies. Under the simplified lay off framework put in place on an exceptional basis, companies were able to make workers redundant even while claiming financial support. Article 13 in the decree law of 26 March 2020, however, removes any ambiguity. It says: “While planned aid measures are being applied, and for the 60 days which follow, a business may not terminate employment contracts, whether by collective redundancy or termination of a position.”
Simplified lay-off regime. As...
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