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Employee Leasing in Portugal

Located on the western coast of Europe, Portugal is one of the best countries in the European Union for expanding your business activity. Thanks to its renowned infrastructure and well-structured economy and business environment, Portugal offers many competitive advantages for businesses that decide to hire a local team.

The employee leasing services that we offer at FMC Group can simplify the expansion of your business activity in Portugal, because not only do we take charge of the recruitment process according to your needs, but we also handle the administrative management of your employees on a day-to-day basis. Moreover, the flexibility we offer helps limit your investment risk to a minimum.


  • Advantages of Employee Leasing in Portugal
  • Employee Leasing Services Offered by FMC Group
  • Advantages of the Portuguese Market
  • Recruitment in Portugal
    • Minimum Wage and Payroll
    • Social Contributions and Taxes
    • Working Hours and Overtime
    • Vacation Days
    • Parental Leave and Sick Leave
    • Notice Period
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Get in touch with us

Portrait of Peter Heidinger, Managing Partner at FMC Group

Peter J. Heidinger

Managing Partner

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+49 711 490 945 31

Advantages of Employee Leasing in Portugal

  • Employee leasing in Portugal allows clients to hire not only from the Portuguese labor market but from the entire talent pool of the European Union.
  • Expanding activity in Portugal through employee leasing can open vast horizons for the client business’ potential, thanks to the unique environment offered by member states of the EU.
  • Having a local team of employees in Portugal helps clients synchronize their activity with some major global markets, including Germany, the United Kingdom, France, etc.
  • Employee leasing significantly reduces the stress related to investing in a new country by completely delegating the administrative and regulatory procedures related to the hiring process and employee management.

Employee Leasing Services Offered by FMC Group

  • We look for and pick the best candidates that will fit right in your company;
  • We conclude contracts that match your exact needs;
  • We provide professional accounting services that respect European and international standards;
  • We pay taxes and social security contributions in accordance with the Portuguese law;
  • We keep track of your employees’ entitlements and paid vacations;
  • We implement private health insurance at the best market rate for your employees if needed;
  • We keep you up-to-date with the management process of your employees through continuous and regular contact.

Management and Reporting Flow of Employee Leasing Services

Management and Reporting Flow Chart

Advantages of the Portuguese Market

  • The location of Portugal at the western extremity of Europe puts it in the center of global trade. Portugal has minimal time difference with some of the largest economies in the world, notably the United Kingdom (no difference), Germany, France, and Italy (1 hour). It also has only a 3-hour time difference with Brazil and Russia.
  • As a member of the European Union, Portugal enjoys an attractive consumer market. The country also enjoys privileged economic relations with Brazil, among other Portuguese-speaking nations, as well as South and Central American states.
  • Portugal has world-renowned logistics and infrastructure, including a road network of over 68,000 kilometers, 3,000 kilometers of which are highways, a railway network of around 2,800 kilometers, 14 international airports, and seven seaports with container terminals.
  • The Portuguese economy has been rapidly growing since its recovery from its 2010-2014 financial crisis and it still has great potential. The International Monetary Fund expects Portugal’s GDP to grow by 4.0% in 2022.

Recruitment in Portugal

Minimum Wage and Payroll

  • The national minimum wage in Portugal is set at EUR 9,870 per year, or EUR 705 per month, based on a 14-months calculation.
  • It is obligatory in Portugal to pay 13th and 14th-month bonuses. These bonuses are paid out in June and December.
  • Salaries in Portugal are paid on the last working day of every month.

Social Contributions and Taxes

Employer Contributions
Social Security 23.75%
Labor Accident Insurance 1.75%
Wage Guarantee Fund 1.00%
Total 26.50%
Employee Contributions
Social Security 11.00%
Total 11.00%
Employee Income Tax
Up to EUR 7,116 per year 14.50%
From EUR 7,116 to EUR 10,736 23.00%
From EUR 10,736 to EUR 15,216 26.50%
From EUR 15,216 to EUR 19,696 28.50%
From EUR 19,696 to EUR 25,076 35.00%
From EUR 25,076 to EUR 36,757 37.00%
From EUR 36,757 to EUR 48,033 43.50%
From EUR 48,033 to EUR 75,009 45.00%
More than EUR 75,009 48.00%


Working Hours and Overtime

  • The legal working limit in Portugal is 40 hours per week and 8 hours per day.
  • Any work above the legal working limit is paid as overtime. However, overtime work cannot exceed 2 hours per day, 8 hours per week, and 150 hours (for companies with over 50 employees) or 175 hours (for companies with less than 50 employees) per year.
  • Overtime work is paid at a rate of 125% of the regular salary rate for the first hour each day and 137.5% for the remaining duration. On rest days and holidays, overtime work is paid at a rate of 150%.

Vacation Days

  • Employees in Portugal are entitled to 22 days of paid leave per year, following their first year of service.
  • During the first year of service, employees earn two days of paid leave per month, up to 20 days.
  • Portugal celebrates 13 public holidays:
    • New Year’s Day: January 1st;
    • Good Friday: Between April 2nd and May 6th;
    • Easter Sunday: Between April 4th and May 8th;
    • Freedom Day: April 25th;
    • Labor Day: May 1st;
    • National Day: June 10th;
    • Corpus Christi: Between May 21st and June 24th;
    • Assumption of Mary: August 15th;
    • Republic Day: October 5th;
    • All Saint’s Day: November 1st;
    • Restoration of Independence Day: December 1st;
    • Immaculate Conception: December 8th;
    • Christmas Day: December 25th.

Parental Leave and Sick Leave

  • Expectant mothers are entitled to 120 days of maternity leave, including 30 days before delivery and a minimum of six weeks after birth, covered fully by social security.
  • Fathers have to take 20 days of paternity leave within six weeks of their child’s birth, including five days immediately after the birth. The leave is paid fully by social security.
  • After the compulsory six weeks of maternity leave and 20 days of paternity leave, either the mother or the father can extend their leave to 120 or 150 days to care for their newborn infant. If the leave is extended to a total of 150 days, it is paid at a rate of 80% by social security. If it is extended only to 120 days, it is fully paid.
  • Employees can take a sick leave for up to 1,095 consecutive days, provided a doctor has certified that they are temporarily unable to work due to their medical condition. The first three days of each sick leave are paid by the employer at a rate of 89%. Meanwhile, social security covers the employee’s salary for the remaining duration at rates of 55% for the first 30 days, 60% between 31 and 90 days, 70% between 91 and 365 days, and 75% after the first year.
  • Employees in Portugal can take five consecutive days of paid leave if one of their immediate family members passes away.
  • Employees can take up to 30 days of paid leave per year to provide urgent care for young family members under 12 years old, and 15 days for older family members.
  • Employees who get married are entitled to 15 days of consecutive paid leave.

Notice Period

  • The notice period for resigning employees in Portugal is set at seven days for workers with less than six months of service, one month for employees between six and 48 months of service, and two months for workers with more than two years of service.

Disclaimer: Although we carefully researched and compiled the above information, we do not give any guarantee with respect to the actuality, correctness, and completeness.