Latest news and stories about legal reforms in work in Portugal for expats and residents.
The Minister of Labour is meeting this Monday at 3:00 PM with the four business confederations and the UGT to resume discussions on the labour law reform. A week ago, employer representatives announced that negotiations had ended, but they ultimately heeded the President of the Republic's appeal to try and reach an agreement once more.
The Minister of Labour meets again today with the UGT and the four business confederations regarding changes to labour law, following the appeal made by the President of the Republic after the 'rupture' announced by the employers.
Negotiations for the labour law (lei laboral) revision resume today between the government, employer confederations, and the General Workers' Union (União Geral de Trabalhadores or UGT). Prime Minister Luís Montenegro stated that over 70 norms have been agreed upon, though key disagreements remain over the individual bank of hours (banco de horas) and rules regarding unlawful dismissal. Workers should note that the General Confederation of Portuguese Workers (Confederação Geral dos Trabalhadores Portugueses or CGTP) plans to attend despite not being officially invited.
The General Union of Workers (UGT – União Geral de Trabalhadores) is one of Portugal’s two main national trade union confederations. Founded in Lisbon on 28 October 1978, it was created as a social‑democratic alternative to the more communist‑aligned CGTP after the 1974 Revolution, grouping unions close to the Socialist Party and moderate centre‑right currents.
UGT represents around 400,000 workers and is affiliated to the European Trade Union Confederation and International Trade Union Confederation, giving Portuguese labour a voice at EU and global level. Its principles stress union independence from the state, employers, churches and parties, internal democracy and active worker participation.
Historically, UGT’s hallmark has been “propositive” social dialogue: it is usually more willing than CGTP to sign tripartite agreements on wages, labour law and social policy with governments and employers, shaping minimum wage increases, working‑time rules and social protection reforms. This makes UGT a key centrist actor in Portugal’s industrial relations, often mediating between left and right while defending collective bargaining and incremental improvements to labour rights.
The CGTP study is a report published by the General Confederation of Portuguese Workers (Confederação Geral dos Trabalhadores Portugueses), Portugal's largest trade-union centre. Such studies typically analyse pay, working conditions and public-sector cuts and are used by unions to justify strike actions and policy demands.
Luís Filipe Montenegro Cardoso de Morais Esteves (born February 16, 1973, in Porto) is a Portuguese lawyer and center‑right politician who has served as Prime Minister of Portugal since April 2, 2024. A long‑time member of the Social Democratic Party (PSD), he is the leading figure of the post‑Troika generation of Portuguese conservatives. Montenegro was elected to the Assembly of the Republic in 2002 for the Aveiro district and remained an MP for 16 years, becoming PSD parliamentary leader from 2011 to 2017 during the bailout and austerity period under Prime Minister Pedro Passos Coelho. He was a prominent defender of strict austerity measures, arguing in 2014 that “the life of the people is no better, but the life of the country is a lot better,” a phrase that has followed his public image since. After an unsuccessful leadership bid against Rui Rio in 2020, Montenegro won the PSD leadership in 2022. He then forged the centre‑right Democratic Alliance (PSD–CDS‑PP and allies), which won a plurality of seats in the 2024 legislative election. Refusing to partner with the far‑right Chega, which he has called “often xenophobic, racist, populist and excessively demagogic,” he formed a minority government as head of the XXIV Constitutional Government on April 2, 2024. His first government fell in March 2025 after a no‑confidence vote linked to a conflict‑of‑interest affair, but fresh elections saw the Democratic Alliance increase its seat share, allowing Montenegro to return as prime minister leading the XXV Constitutional Government. His importance to Portugal lies in attempting to re‑center the traditional centre‑right after the crisis years, defending liberal‑conservative economics and EU alignment while drawing a sharp line against formal cooperation with the radical right, thus shaping how Portuguese democracy manages its new multi‑party era.
The trade union federation intends to reaffirm its proposals and contests the attempt to exclude it from the meeting on labour law, considering it a violation of the constitutional right to participation. The Government has been negotiating the 'Trabalho XXI' package, which includes over 100 amendments to the Labour Code, with the UGT and employers.
The CGTP trade union federation insists on participating in the debate regarding changes to labour legislation.
The Left Bloc (BE) stated it has 'no reason to doubt' the promises Seguro made during the campaign, stressing that if one 'swears to defend, comply with and enforce the Constitution', they must veto the labour reform.
Prime Minister Luís Montenegro faces criticism over his labour reform agenda, with commentators suggesting the government is distancing itself from a potentially failing policy while Montenegro defends his commitment to action-oriented reform.
The last meeting ended without an agreement and with mutual accusations of intransigence.
Update: Government schedules fresh labour law talks for Monday
Minister of Labour Rosário Palma Ramalho has summoned the General Confederation of Portuguese Workers (União Geral de Trabalhadores or UGT) and business leaders to a meeting on Monday, March 16. The government aims to exhaust all possibilities for an agreement rather than prolonging the discussion indefinitely.
Rosário Palma Ramalho is Portugal’s Minister of Labour, responsible for labour policy, workplace regulation and negotiations with trade unions. Her statements today about the CGTP withdrawing from labour reform talks matter because they affect negotiation dynamics and can influence strikes or demonstrations that may disrupt public services and workplaces.
The General Union of Workers (UGT – União Geral de Trabalhadores) is one of Portugal’s two main national trade union confederations. Founded in Lisbon on 28 October 1978, it was created as a social‑democratic alternative to the more communist‑aligned CGTP after the 1974 Revolution, grouping unions close to the Socialist Party and moderate centre‑right currents.
UGT represents around 400,000 workers and is affiliated to the European Trade Union Confederation and International Trade Union Confederation, giving Portuguese labour a voice at EU and global level. Its principles stress union independence from the state, employers, churches and parties, internal democracy and active worker participation.
Historically, UGT’s hallmark has been “propositive” social dialogue: it is usually more willing than CGTP to sign tripartite agreements on wages, labour law and social policy with governments and employers, shaping minimum wage increases, working‑time rules and social protection reforms. This makes UGT a key centrist actor in Portugal’s industrial relations, often mediating between left and right while defending collective bargaining and incremental improvements to labour rights.
President António José Seguro and Parliament President José Pedro Aguiar-Branco have urged the government and social partners to resume negotiations on the new labour law (legislação laboral). While employer confederations recently stated conditions for an agreement were lacking, the government and some unions have expressed openness to further talks. The proposed reforms, known as the Trabalho XXI draft bill, have faced significant hurdles over issues like outsourcing and the right to disconnect. Workers should note that Socialist Party (Partido Socialista) leader José Luís Carneiro has criticized the current proposals as a “choice for inhumanity.”
Update: Business groups and UGT agree to resume labour talks
President Seguro has successfully revived negotiations after business confederations previously declared them over. The Confederation of Tourism (Confederação do Turismo de Portugal or CTP) and the Confederation of Commerce and Services (Confederação do Comércio e Serviços de Portugal or CCP) confirmed their availability to return to the table. The General Union of Workers (União Geral de Trabalhadores or UGT) also clarified it never intended to leave the discussions.
Socialist Party (PS)
Portugal's other traditional major party suffered a historic collapse in the 2025 election, dropping from 78 to 58 seats and falling to third place for the first time in democratic history. The party was led by Pedro Nuno Santos from January 2024 until his resignation following the May 2025 defeat. José Luís Carneiro, a 53-year-old former Minister of Internal Administration known for his moderate positioning within the party, was elected unopposed as the new Secretary-General with 95% of votes in June 2025. The Socialist Party governed Portugal from 2015 to 2024, including an absolute majority from 2022 to 2024 under António Costa, who resigned in November 2023 amid a corruption investigation. The PS previously led the innovative "Geringonça" (contraption) coalition government from 2015-2019, a minority government supported by the Left Bloc and Portuguese Communist Party that reversed austerity measures and presided over economic recovery.
José Pedro Aguiar‑Branco is the President of the Assembly of the Republic, who in this story requested that the Committee on Constitutional Affairs examine the constitutional conformity of government measures in a proposed bill. He is using his parliamentary role to trigger a formal review of changes affecting confession rules and the rights of the defence.
The General Union of Workers (UGT – União Geral de Trabalhadores) is one of Portugal’s two main national trade union confederations. Founded in Lisbon on 28 October 1978, it was created as a social‑democratic alternative to the more communist‑aligned CGTP after the 1974 Revolution, grouping unions close to the Socialist Party and moderate centre‑right currents.
UGT represents around 400,000 workers and is affiliated to the European Trade Union Confederation and International Trade Union Confederation, giving Portuguese labour a voice at EU and global level. Its principles stress union independence from the state, employers, churches and parties, internal democracy and active worker participation.
Historically, UGT’s hallmark has been “propositive” social dialogue: it is usually more willing than CGTP to sign tripartite agreements on wages, labour law and social policy with governments and employers, shaping minimum wage increases, working‑time rules and social protection reforms. This makes UGT a key centrist actor in Portugal’s industrial relations, often mediating between left and right while defending collective bargaining and incremental improvements to labour rights.
Negotiations for a new labour reform package ended without an agreement between the government, the General Workers' Union (União Geral de Trabalhadores or UGT), and employer confederations. The Business Confederation of Portugal (Confederação Empresarial de Portugal or CIP) stated that 12 points remain unresolved after seven months of debate, including last-minute demands that hindered a consensus. While the government blamed the UGT for being “intransigent,” the union argued the proposals were structurally inadequate and failed to meet necessary conditions. Workers should note that current labour laws remain in place as the future of the reform package is now uncertain.
Update: Opposition leader criticizes government's "lack of humility"
The Secretary-General of the Socialist Party (Partido Socialista or PS), José Luís Carneiro, accused the government of a “lack of democratic humility” following the collapse of labor negotiations. Carneiro argued that the failure to reach an agreement with social partners harms the country's competitiveness and urged Prime Minister Luís Montenegro to resume dialogue on more acceptable terms.
The General Union of Workers (UGT – União Geral de Trabalhadores) is one of Portugal’s two main national trade union confederations. Founded in Lisbon on 28 October 1978, it was created as a social‑democratic alternative to the more communist‑aligned CGTP after the 1974 Revolution, grouping unions close to the Socialist Party and moderate centre‑right currents.
UGT represents around 400,000 workers and is affiliated to the European Trade Union Confederation and International Trade Union Confederation, giving Portuguese labour a voice at EU and global level. Its principles stress union independence from the state, employers, churches and parties, internal democracy and active worker participation.
Historically, UGT’s hallmark has been “propositive” social dialogue: it is usually more willing than CGTP to sign tripartite agreements on wages, labour law and social policy with governments and employers, shaping minimum wage increases, working‑time rules and social protection reforms. This makes UGT a key centrist actor in Portugal’s industrial relations, often mediating between left and right while defending collective bargaining and incremental improvements to labour rights.
CIP is the Confederation of Portuguese Business (Confederação Empresarial de Portugal), the main employers’ association that represents companies and sector groups in Portugal. It lobbies government on economic and labour policy and its statements are watched by investors, employers and workers when debates arise over funding rules and labour reforms.
Socialist Party (PS)
Portugal's other traditional major party suffered a historic collapse in the 2025 election, dropping from 78 to 58 seats and falling to third place for the first time in democratic history. The party was led by Pedro Nuno Santos from January 2024 until his resignation following the May 2025 defeat. José Luís Carneiro, a 53-year-old former Minister of Internal Administration known for his moderate positioning within the party, was elected unopposed as the new Secretary-General with 95% of votes in June 2025. The Socialist Party governed Portugal from 2015 to 2024, including an absolute majority from 2022 to 2024 under António Costa, who resigned in November 2023 amid a corruption investigation. The PS previously led the innovative "Geringonça" (contraption) coalition government from 2015-2019, a minority government supported by the Left Bloc and Portuguese Communist Party that reversed austerity measures and presided over economic recovery.
The proposed reform of the Code of Criminal Procedure threatens to impose financial penalties on lawyers for actions deemed 'manifestly unfounded' by judges, creating a two-tier criminal justice system that disproportionately impacts less affluent citizens. With fines ranging from €204 to €10,200, and potential disciplinary actions for repeat offenses, this legislation undermines legal certainty and fairness, ultimately jeopardizing the right to a fair trial.
The Government has actively engaged in revising labour law, presenting a draft bill on 24 July and reconvening the Permanent Commission for Social Dialogue in September. Following several meetings with business confederations and the UGT, a significant meeting is scheduled for 3 March to further discuss the labour law reform, indicating ongoing negotiations and collaboration among stakeholders.
Thousands of demonstrators took to the streets in Lisbon and Porto to protest against the government's proposed changes to the labour law, known as the 'Work XXI' reform. Led by the CGTP union, the protests highlighted concerns that the reforms would negatively impact workers' rights. CGTP's Secretary-General, Tiago Oliveira, called for the government to withdraw the labour package, emphasizing its detrimental effects on the workforce.
A real estate businessman has been charged with 52 counts of qualified fraud, stemming from fictitious transactions involving the sale of properties that were seized by the state. This case highlights significant issues within the real estate market and raises questions about legal reforms needed to prevent such fraudulent activities.
The issue of fake recibos verdes is a critical concern that transcends political ideologies, emphasizing the need for labor justice. Addressing this problem is essential for ensuring fair labor practices and protecting workers' rights.
The government is proposing legislative changes to enhance the role of victim and witness testimonies in domestic violence cases, aiming to improve the effectiveness of criminal responses and reduce case dismissals. Justice Minister Rita Alarcão Júdice emphasizes the importance of these reforms, which include standardizing the collection of statements for future reference, particularly for vulnerable victims like children. Even if victims do not testify at trial, their prior statements will be treated as valid evidence. The proposal follows a report from the Superior Council of the Judiciary and has garnered support from the Portuguese Association for Victim Support (APAV), which advocates for improved victim rights and a gender perspective in judicial decisions. The government claims it has the necessary resources to implement these changes and is working to expand support networks for victims of violence.
Every day, justice declares insolvency for 17 individuals, with commerce and workshops leading the charge in business bankruptcies. The crisis is also escalating in sectors such as hospitality, catering, and agriculture, indicating a broader economic downturn.
The Government plans to submit a proposal for revising the labour law to Parliament despite lacking an agreement in the Social Concertation. This move raises questions about whether Chega will play a crucial role in facilitating the reform of the Labour Code, as the Government seeks support from opposition parties without an absolute majority.
Carlos Rodrigues argues that postponing elections without a legal framework could create dangerous precedents for governance and democracy. He emphasizes the importance of adhering to established laws and policies to maintain the integrity of electoral processes.
UGT has drafted a counterproposal containing nearly 100 amendments to the Government’s labour package and plans to submit it to the Minister of Labour after the presidential election second round on 8 February. The document is framed as a comprehensive alternative aimed at reshaping the proposed reforms to strengthen workers’ rights, legal protections and workplace standards, and to force substantive negotiation with ministers over the direction of labour law change.
A parliamentary move — despite abstentions from PSD and CDS-PP — brings Portugal closer to lengthening the initial parental leave available to working parents. The new episode of the 'Ao Trabalho!' podcast examines that development alongside other labour‑market highlights, offering concise analysis of labour, social-security and employment-law developments every Thursday.
José Manuel Pureza, national coordinator of the Bloco, criticised the Government's proposed labour law package, accusing the labour minister of intransigence and asserting that her refusal to compromise reflects the Government's broader stance. Pureza urged firm commitments from Seguro and argued that a President sworn to uphold the Constitution should repudiate measures he says the package represents. The intervention heightens the political tension around the reform and raises questions about forthcoming presidential and parliamentary responses.
In a document submitted to the Minister of Labour, Solidarity and Social Security at a bilateral meeting on 3 September, CGTP proposes revoking banked hours and widening access to flexible working arrangements. The union seeks to extend flexible hours to parents with children up to 16 years old and to introduce limits on fixed‑term contracts. If adopted, the measures would shift scheduling power toward workers with family responsibilities and constrain employer use of temporary hours arrangements.
A citizens' initiative that gathered more than 42,000 signatures has forced Parliament to reopen debate on reforming initial parental leave. The proposal — to extend leave from the current 120/150 days to 180/210 days (effectively six months) at 100% pay regardless of how it is shared between parents — will be reconsidered in the Assembly of the Republic after an earlier attempt was nullified by the dissolution of the Assembly and the fall of the Government in March 2025. An earlier related extension was approved on 27 September 2024, but procedural developments and the renewed petition have brought the issue back onto the legislative agenda.
From 1 January 2026 the amendment to the VAT periodicity regime shifts the onus from the Tax and Customs Authority to the taxpayer: rather than receiving an official reclassification, taxpayers must now submit a formal declaration to request a change of periodicity. The declaration should identify the taxpayer (tax identification number and contact details), state the current and requested VAT periodicity classification, give the intended effective date and the legal or factual reasons for the change (for example a change in turnover, accounting regime or business structure), and attach any supporting documents required by the Authority.
In practice the declaration is normally submitted electronically via the Authority’s online portal and must be signed with the appropriate digital signature or authentication method. Before filing, reconcile turnover figures and previous VAT returns so the requested periodicity is consistent with statutory thresholds; indicate whether the change is temporary or permanent; and keep a copy of the submission receipt. Late, incomplete or absent declarations can lead to the Authority maintaining the previous classification, administrative penalties or cash‑flow disruption from an unexpected reporting frequency. For most taxpayers — and especially for expats or businesses undergoing structural change — it is advisable to consult an accountant or tax adviser to check eligibility, prepare supporting evidence and confirm the correct form fields and deadlines on the Authority’s website.
Maria de Fátima Carioca argues that Portugal needs a substantial overhaul of its labour legislation, saying flexibilisation of labour relations is unavoidable but must not undermine social protections. She warns the proposed new law is not a magic wand for boosting wages — structural reform is required alongside measures to safeguard workers. Her remarks come as the Government prepares a wide-ranging review of labour rules and the social safety net.
