Government measures in key jurisdictions 5th edition - Flipbook - Page 105
Portugal
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The first installment is paid within 10 working days as from the date of communication of
the approval of the application to the incentive;
The second installment is paid within 180 days following the last day of application of the
extraordinary support for the maintenance of employment contracts (“simplified lay-off”)
or the extraordinary training plan.
The extraordinary incentive for the normalization of business activity is only granted once
to each employer, and only in one of the modalities provided for in the Ordinance no. 170A/2020 of 13 July. Therefore, only one application should be submitted by each employer.
The application is made through electronic submission here and shall be accompanied by
the documents set forth in the applicable legislation. Given the worsening of the current
situation in Portugal and the new state of emergency, the Portuguese Government
authorized that, as of February 2021, companies that have accessed the Extraordinary
Incentive for Business Regularization, regardless of the modality, can access the
progressive resumption support measure. Therefore, these support measures have only
been mutually excluded until January 2021.
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Progressive resumption support measure: This measure is considered a substitute measure
(for companies that may no longer resort to the simplified lay-off regime or consider this
support measure preferable in comparison to the simplified lay off regime, while this new
state of emergency lingers). It applies to employers who have been affected by the Covid-19
pandemic and who are, as a result, in a situation of business crisis, i.e., with a decrease in
revenues of 25% or more. Thus, the employer can access the extraordinary support for the
progressive resumption of activity with a temporary reduction of the normal work period of
all or some of its employees, being able to resort to this reduction and its respective
remuneration for one month, with a monthly extension until the date of termination provided
for by law (currently until 30 June 2021). The employer is entitled to financial support
exclusively for the purpose of paying compensation to employees covered by the reduction
of the normal working period. Social security support corresponds to 70% of this
compensation, the remaining 30% being provided by the employer. Notwithstanding, if from
the remuneration paid for the hours worked and compensation to which the employee is
entitled for hours not worked results in a monthly amount lower than that of the employee’s
gross normal remuneration, the amount of compensation paid by the Social Security is
increased to ensure 100% of the employee’s remuneration, up to a limit of 3 minimum
monthly salaries guaranteed (Ä1,995). In the event of a serious business crisis, with a 75% or
more drop in turnover, the employer is also entitled to 35% of the gross remuneration to be
paid by the Social Security to the employee for the hours worked. To resort to this support
measure, the employer must submit an electronic application, in a proper form, through the
Direct Social Security, with the employer's declaration and the certified accountant's
declaration (Mod. 3058-DGSS) attesting the business crisis situation. The form must be
accompanied by a nominative list of the employees to be covered, their social security
number, gross normal pay and an indication of the reduction in the normal working period to
be applied, in average monthly terms, per employee. Consent must also be given for
consultation of the tax standing with the tax authorities, as well as registration of the IBAN to
which the financial support will be credited.
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Exemption from contributions: either under the simplified lay-off regime and progressive
resumption support measure, the employer has some benefits as regards contribution
obligations to which is bound. Specifically regarding the progressive resumption support
measure, the employer that is considered to be a micro, small or medium-sized enterprise
and that benefits from this support measure has the right (officially recognized by the Social
Security Services) to 50% exemption from the payment of contributions for covered
employees, related to the compensation to be paid. In relation to the simplified lay- off
regime, this support measure provides for a temporary (yet total) exemption from the
payment of Social Security contributions due by the employer (the exemption refers to the
employer's contributions related to the total remuneration paid to the covered employees,
maintaining the employee’s contribution of 11%).
Government measures in key jurisdictions
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