Whether the increase in the severance pay from 12 to 14 days per year worked from October 2013 or in the future, when the change comes into effect, will only be made clear by the cabinet at the next social consultation, scheduled for November 23.
Labor Minister Ana Mendes Godinho was asked this Wednesday, at the end of a social consultation, whether the government follows the PS’ interpretation that the increase in allowances should come into effect from October 2013, and answered only that, “On more concrete matters, it has been agreed that at the next meeting, which will take place on the 23rd, there will be two items on the agenda: one on the implementation of various measures included in the income agreement and those for the should be settled by the end of the year.”
Mendes Godinho also underlined that “this issue is being discussed in the Assembly of the Republic, in the context of the discussion of the Decent Work Agenda”, without finally saying what the executive’s reading is. In any case, amendments to the Labor Code, such as this one, must be approved by Parliament.
It is certain that the bosses will not accept the retroactive increase in severance pay. The president of the Confederation of Commerce and Services (CCP), João Vieira Lopes, said yesterday that “the interpretation the confederation has is that the amendment will not take effect until the day it is published”. The Portuguese Business Confederation (CIP) shares the same view. Both also state that the commitment in the income agreement with the government was that the increase in severance payments would be applied in the future, Dinheiro Vivo knows.
To get an idea of the increase in redundancy costs if the change is retroactive, we present this case: an employee who is laid off in 2023 with 10 years of service would cost the company 14.7% more compared to the costs that the employer would have had if he did not apply the 14-day compensation until 2023, the year in which the change is expected to take effect.
During the social consultations on Wednesday, the Minister of Labor presented the pilot project for the four-day week that should start in June next year. The experience focused on the private sector at this stage is voluntary, reversible and prevents salary cuts. Mendes Godinho guarantees that the pilot will allow him to reduce the total number of hours worked during the week, but admits that the daily journey could be longer than the current eight hours.
Source: DN
