Employer of Record in Portugal | INS Global
Countries / Portugal / Employer of Record in Portugal

PEO in Portugal

Hire Globally, Pay Locally, Expand Effortlessly

A PEO (Professional Employer Organization) is a third-party company that can provide many HR outsourcing services to benefit your business in Portugal. These services can include all elements of HR operations, from recruitment and onboarding to payroll and leave management.

Like an EOR (Employer of Record), a PEO in Portugal can be your local partner, hiring and managing HR operations for your employees on your behalf and allowing you access to new markets without establishing a new separate legal entity.

INS Global has offered PEO and EOR services for more than 15 years and now serves over 80 countries. Our experts in international HR can provide you with the knowledge and expertise you need to thrive in Portugal, all while avoiding costly setup processes and regulatory fees.

Want to have a Team in Portugal TODAY?

Show me how to grow my business now!

We prefer to let others grow their business.

Want to have a Team in Portugal TODAY?

Show me how to grow my business now!

We prefer to let others grow their business.

PEO in Portugal - Summary

The Key Advantages of Using a PEO in Portugal

Full Legal Compliance

Be assured of compliance with every element of local law and regulations as they relate to you and your employees 

 

Lower Costs

Studies commonly find that PEOs save companies money in multiple ways, like reducing the size of an HR department, lowering employee turnover rates, and avoiding fees or fines  

Worldwide Employee Satisfaction

Your employees can feel secure knowing that all of their needs are being met quickly and efficiently by professionals specialized in the market  

Increased Market Entry Speed

The process of incorporating a new company in a foreign market can take months, whereas entering with a PEO is possible in less than a week 

One Platform For All

Outsource as many services as you like to our team of specialists in a plan built to suit you thanks to our HR Software.

PEO Over Company Incorporation: What are the Advantages?

Company incorporation can be a complex and costly process if you’re trying to establish a new entity in a foreign market. While company incorporation may seem advantageous in the independence and long-term options it provides, these come at a cost in time and overheads that may work against growth and expansion goals. 

A PEO grants you the flexibility to invest in Portugal to a level you desire and the confidence that you will avoid the risks associated with fully diving into a new and unfamiliar market 

A PEO:

  • Gives you knowledge and expertise in your target market instantly 
  • Allows you to feel secure knowing you are fully compliant with all local regulations 
  • Avoids overheads related to establishing and running a company in Portugal 
  • Provides full scalability to suit your needs 
Hiring an Overseas Employee

Testimonial

Manuel Ramos

TERAO ASIA

Managing Director

We think INS Global is a good solution about starting business in new and complex markets. Understanding the market doesn’t mean you need to set up a company immediately.

5/5

How Can You Get Started With Our PEO in Portugal?

Have your employees recruited or assigned in Portugal in 4 simple steps:

  1. Discuss your needs with one of our Portugal PEO specialists to formulate a plan that serves your needs best 
  2. INS Global provides you with a legal entity in the market that can hire or manage HR operations for your employees.
  3. We manage all elements of compliance and HR for your employees.
  4. You can get to work immediately while we take care of the rest 

PEOs and EORs: How Do They Differ?

In most countries, the two services are considered identical for compliance purposes. However, it’s helpful to understand the main differences between them to choose one that better suits your needs.  

  • A PEO is a third-party company that provides services to your employees in a foreign country 
  • In a PEO agreement, the employees’ contracts remain with you
  • An EOR is a third-party company that provides services to your employees while also legally hiring them on your behalf 
  • In an EOR services agreement, the employees’ contracts are made directly with the EOR at your direction 
  • This way, the EOR takes on all legal responsibilities for your employees 

 

According to your needs, INS Global can offer both PEO and EOR services in Portugal. Contact one of our consultants today to find out more about which option is best for you.  

Labor Law in Portugal

Employment Contracts

The primary source of information on employment law in Portugal is the Labor Code, last updated in 2022 

Contracts in Portugal may be written or verbal, although written contracts are always suggested to avoid unnecessary disputes later on. 

Portuguese labor law includes options for many different contract types, such as part-time, specified duration, or unspecified duration. 

Portugal has a minimum wage, although this is adjusted depending on the region. 

Working Hours and Overtime

A new law, passed in November 2021, makes it illegal for bosses to text employees outside of work hours. This was passed to improve work-life balance as a result of remote work.  

Portuguese labor law establishes a maximum of 8 hours per workday and 40 hours per week. Collective bargaining agreements may apply to increase the amount and flexibility of those hours, so long as the average falls within an acceptable maximum. 

Any hours worked outside of this maximum is considered overtime. Overtime should only be arranged temporarily, although an employer can declare overtime to be mandatory.  

Overtime pay should be calculated (based on standard salary) as: 

  • Working days: 125% for the first hour, 137.5% for additional hours 
  • Rest days: 150% for each hour  

Holidays and Annual Leave

Employees in Portugal are eligible for a minimum of 22 days of paid leave per year. There are circumstances in which this can be higher or lower depending on the employee’s time spent with the company and when the employee takes this leave during a year.   

There are 13 days of public holidays in Portugal. Employees are not entitled to an extra day of leave if a public holiday falls on a rest day.  

Maternity/Paternity Leave

Female employees are eligible for 120 days of maternity leave, paid at 100% by social security. Mother must take off at least 90 days after the birth of a child. 

Male employees are eligible for 20 days of mandatory paid paternity leave, 5 of which must be taken immediately following the birth of a child. 

Parents can apply for additional parental leave at varying rates of remuneration. 

Sick Leave

Employees in Portugal are entitled to sick leave paid for by their social security. The maximum amount of sick leave that can be taken is 3 years. During this time, they are paid 55% standard salary for the first month to 75% for over a year.  

Taxes and social contributions

Corporate tax in Portugal is 21%. 

Non-residents are taxed on Portuguese-sourced income at a flat rate of 21%. 

Residents in Portugal are taxed on their worldwide income on a progressive scale from 14.5-48%. 

Social Security payments cover family, pension, and unemployment benefits and are shared by the employee and employer at the following rates: 

  • Employer: 23.75% employee’s standard salary 
  • Employee: 11% employee’s standard salary 

Employers must also purchase an additional occupational accidents insurance premium to cover their workers.  

Foreign employees may opt out of social security contributions in Portugal if they already pay into a similar national scheme.  

CONTACT US TODAY

Discover More Solutions in Portugal

DOWNLOAD THE PDF