Portuguese employers and trade unions have agreed labour market reforms to boost the economy’s competitiveness, as required under the terms of the EU/IMF bailout. However, the CGTP union walked out of the talks and the government has had to drop a controversial proposal to increase the normal working day by half an hour to 8.5 hours.
Measures agreed so far include: shortening workers’ annual holiday entitlement from 25 to 22 days, scrapping at least three public holidays, reducing redundancy compensation, cutting overtime pay levels, and allowing companies to require employees to work up to 150 additional hours each year without overtime premium – to be used by the employer as and when they were needed.
Under an imaginative further reform, unemployed people who accept work that pays less than their unemployment benefit will be able to keep 50% of the benefit payment.