The vacation leave is always longed for by all of us, whether it is to go to the beach, snow, or simply to spend quality time with family. However, this subject still has raised some doubts and queries in the field of enjoyment rights as well as the level of its payment; items that we will try to answer here.

According the Portuguese Law, the right to holidays, as a rule, refers to work done in the previous calendar year, i.e. the employee is entitled, in each calendar year, to a period of paid holidays, which achieves on 1st  of January and thus acquires the right to 22 working days (minimum limit) of holiday leave that refer to the previous year worked in full period. The enjoyment of the holiday period may be alternated, by agreement between employer and employee, provided that at least 10 consecutive working days are taken.

In the event that the calendar year ends and the days of holidays to which the employee is entitled, have not been taken, they may be taken further until 30th of April of the following year, and in the same calendar year there may not be enjoyed more than 30 working days of holidays (except for an instrument of collective labor regulation to the contrary).

Special cases

As already mentioned, the minimum holiday period is 22 working days per year, however there are special cases where the period is different. These cases occur in the calendar year of admission and in the calendar year following admission. In the year of admission, the employee is entitled to 2 working days of holidays for each month of the duration of the contract, up to a maximum of 20 working days, the enjoyment of which may take place after six full months of execution of the contract, but may be taken earlier by agreement between the employer and the employee. In the year following the admission, the employee is entitled to 2 working days of holiday for each month of the duration of the contract up to 22 working days. In these two years, the vacation period is a reflection of the working time of each calendar year and not the previous year.

If the year of admission ends and the days to which the employee is entitled have not been taken, the holidays can be taken until 30th of June of the following year.

Holidays payment

With the right to take holidays, the question of payment arises: are they or are they not remedied if the employee is not carrying out his or her duties? Yes, holidays are a paid period and correspond to what the employee would receive if he/she was in the exercise of his/her duties. In addition, the employee is entitled to receive holiday payment, which includes the basic salary and other benefits in return for carrying out the work (e.g. exemption from working hours), corresponding to the minimum duration of the holiday, the 22 working days.

When an employment contract ends, the worker is entitled to receive the holiday payment and the respective allowance: from the holidays that have expired and not taken, i.e. the calendar year in which the employment contract is terminated; and also, to those proportional to the length of service provided in the year of termination, i.e. referring to the time they are working in that calendar year for the following year. At the end of an employment contract, must also be taken into account the special cases: on termination of employment in the calendar year of admission or the following year the employee is only entitled to the proportional vacation allowance, and untaken vacation, taking into account the duration of the contract. For this reason, we always advise that, in these first two years, the holiday allowance is remunerated in proportion at the time of payment and the remaining amount at the end of the year, thus avoiding that the company overpays since this amount cannot be deducted to the employee after being paid with is formal consent.

With this moment moved by the pandemic crisis of COVID 19, many companies have had the need to apply for the extraordinary layoff support, and with this comes another doubt: do companies have to pay the holiday allowance in full to the employees covered? The answer is yes; the Labor Code is clear on this aspect: the reduction or suspension is without prejudice to the scheduling and enjoyment of holidays, in general terms, the employee is entitled to payment by the employer of holiday due under normal working conditions.

It is important to point out that the right to holidays is inalienable and its enjoyment cannot be substituted by any remuneration or other compensation, even with the employee’s agreement, which makes sense because holidays allow physical and psychological recovery, keeping the employees more well-motivated, productive and committed to the company.

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Rute Alexandra Balixa Santos
Payroll Services

All information contained in this publication is up to date on 2020. This content has been prepared for general guidance on matters of interest only, and does not constitute professional advice. You should not act upon the information contained in this chart without obtaining specific professional advice. No representation or warranty (express or implied) is given as to the accuracy or completeness of the information contained in this content, and, to the extent permitted by law, AUXADI does not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this chart or for any decision based on it.