Legal alert no. 31

On June 21st, Decree-Law no. 72/2017, which rules the awarding of incentives for the recruitment of (i) young people looking for their first job, (ii) long-term unemployed and (iii) very long-term unemployed, was published in the Portuguese Official Gazette

The scheme is only applicable to permanent labour contracts.

Thus, there will be a 50% reduction of the Social Security contribution rate (i) for five years for Companies hiring young people looking for their first job and (ii) for three years for long-term unemployed.

It is also foreseen the total exemption of the payment of contributions, for three years, in case of hiring very long-term unemployed.

This new scheme introduces the concept of "portability", which transfers the benefit of the incentive also to the employee, by providing that it is awarded to the employee regardless of the employers who hire him with a permanent labour contract, under certain conditions.

This Decree-Law enters into force on August 1st, 2017.

To access the full version of Decree-Law no. 72/2017, please click on the following hyperlink:

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