Changes to the Labour Code – Trial Period

By Wednesday May 20th, 2020 June 19th, 2020 Direito Societário e Laboral

Continuing our journey through the changes introduced in the Labour Code by Law 93/2019 of September 4, we must point out the news regarding the trial period.

According to the provisions of article 111 (1) of the Labour Code, “The trial period corresponds to the initial time of execution of the employment contract, during which the parties appreciate the interest in its maintenance.” It means that either party can terminate the employment contract during the trial period without having the obligation to compensate the other party if it is not in their interest to maintain the employment relationship.

What is new?

The duration of this period for the majority of employees with a permanent contract remains at 90 days brought by the original wording of the Code. However, this original wording also provided for a 180-day trial period “for employees holding positions of technical complexity, a high degree of responsibility or requiring special qualifications, as well as those carrying out functions of trust.” One of the novelties brought by Law 93/2019 of September 4 was precisely the extension of cases to which a 180-day trial period could be applied.

The table below can demonstrate more accurately the change that was undertaken:

As has been shown in this table, the possibility of applying a trial period is opened to employees who are hired for their first employment or long-term unemployed people.

What are young people looking for their first job and long-term unemployed?

Young people looking for their first job, as defined by the provisions of article 4, paragraph 1, al. a) of Decree-Law no. 72/2017 of 21 June are “… people under the age of 30 (included) who have never had a permanent employment contract.”. In turn, long-term unemployed are, according to the provisions of paragraph b) of the same article, “… people who have been registered with the Employment and Vocational Training Institute (IEFP) for 12 months or more.”. We understand, of course, that the long-term unemployed are covered by this extended trial period (“… people aged 45 years or over who have been registered with the IEFP for 25 months or more.” – article 4, no. 1, al. C) of Decree-Law no. 72/2017 of 21 June), for a very good reason.

On the other hand, although the phrase “or” of paragraph b) of Article 112 (1) of the Labour Code has disappeared, it seems equally clear that the situations included in the indent of the new paragraph b) remain alternatives – ie, it is not necessary for the employee to be unemployed for a long time and to occupy a position of technical complexity, he only needs to fulfil one of the requirements.

What about incentives for permanent contracts?

It should be noted that the hiring of employees looking for their first job and the long-term unemployed was already the subject of considerable incentives for companies, which include the granting of financial support by the IEFP and the partial exemption or total exemption from the payment of contributions. for the general social security regime, in the part relating to the employer.

The motivations associated with this change are easy to ascertain: on the one hand, encourage the hiring of a fringe in the labour market, which traditionally has greater difficulties in being integrated (or reintegrated) in that same market; on the other hand, to continue to encourage open-ended hiring, making the cases of fixed-term hiring increasingly an exception.

Thanks for being in that side.