The preliminary draft of labor law reform presented by the government of Luís Montenegro in July, labeled as the “Trabalho XXI” package, aims to amend the General Regime of Tax Offenses (RGIT). It proposes the revocation of an article introduced in 2023 by António Costa’s administration in the “Agenda for Decent Work,” which criminalizes the failure to report the hiring of workers within six months after the legally stipulated period.
This general rule also covers the hiring of cleaning workers, currently carrying a penalty of up to three years in prison or a fine of up to 360 days (up to 180,000 euros).
If approved by parliament as proposed, failing to declare will cease to be a crime but will still result in a fine. If notified by Social Security, penalties can be imposed.
This change marks a return to the situation prior to the implementation of the “Agenda for Decent Work.”
The reporting can be done online through the Portuguese Social Security Direct website.
Madalena Caldeira, a lawyer with the Gómez-Acebo & Pombo firm in Lisbon, explains that this requirement “derives from Article 29 of the Code of Contribution Schemes of the Social Security System,” which remains unchanged in the new legislative draft.
Caldeira states, “This communication must be conducted within 15 days prior to the contract’s effective date or within 24 hours following the activity’s start if, due to exceptional and properly justified circumstances, such as short-term contracts or shift work, reporting within 15 days is not feasible.”
Lawyer Rita Robalo de Almeida from Antas da Cunha Ecija emphasizes that this communication must include the “Social Security Number (NISS) or Tax Identification Number (NIF) of the worker, birth date, start date, and agreed compensation mode (hourly, daily, or monthly).”
Failing to report the employment relationship may lead to a fine from Social Security, determined by the timing, nature of the entity, and degree of fault (negligence or intent), Robalo de Almeida notes.
According to Caldeira, if the notification occurs within 24 hours after the legal deadline, it is considered minor (ranging from 50 to 500 euros). Beyond that, it becomes very serious, ranging from 1,250 to 12,500 euros.
In each case, the fine amount varies based on the level of fault.
If corrected within 24 hours, the fine ranges from 50 to 250 euros for negligence and 100 to 500 euros for intent.
In cases of omission within the deadline without correction within 24 hours of the employment relationship’s commencement, the offense is very serious, with fines ranging from 1,250 to 6,250 euros for negligence and from 2,500 to 12,500 euros for intent.
When workers are paid hourly, the declared wage serving as the contribution calculation base is 3.01 euros per hour, regardless of an actual higher pay such as eight, nine, or ten euros per hour.
The employer must declare at least 30 hours per month, even if fewer hours are worked.
The employer contributes 18.9%, and the worker 9.4%, resulting in a total contribution rate of 28.3%.
