Employer of Record Portugal

Think of it like this: Agility EOR becomes the legal employer of your employees, taking care of all the paperwork and compliance headaches.

Agility EOR

• We manage the onboarding process and ensure everything’s in order before your employee starts
• We make sure your employees are treated fairly and compliantly in their relevant territory
• We take care of all HR matters, and can answer any and all HR queries you may have e.g. maternity/paternity leave, holidays, sick pay, and more
• We provide compliant contracts, process local payroll, and file taxes
• We issue payslips and handle payments to the employee and authorities

Your Company

• You find and manage your employees’ daily tasks
• You support their development through their work
• You follow our guidance on employment laws and best practices
• You ensure payroll bills are paid to Agility EOR on time

Benefits of using an Employer of Record (EOR)

• Faster and easier hiring: No need to set up your own legal entity.
• Reduced risk and compliance burden: We handle the legal and administrative complexities.
• More time and resources: Focus on your core business while we manage your employees.

There are various ways to employ people in Portugal, each with differing levels of costs and compliance:

Employee is employed by you and paid by you from your overseas Company

• Pros: Seems like it would be the cheapest and easiest option.
• Cons: Unable to pay the social security contributions which are required by law, and Portugal employment law will apply to the employee.

Entity Set-up

• Pros: This option might be the most cost-effective solution for employing a significant number of personnel, typically exceeding 15
• Cons: Establishing a legal business entity and maintaining strict compliance with Portugal employment and tax regulations can be a significant cost and time burden, especially for smaller operations. This approach often becomes impractical for businesses employing less than 15 individuals.

Using an Employer of Record

• Pros: In Portugal, utilizing an Employer of Record service proves to be the most time-and-cost-effective solution for managing payroll, HR, and compliance tasks, particularly for establishing employer-employee relationships with teams smaller than 15 individuals.
• Cons: Costly when hiring a large number of employees. Knowing which Employer of Record provider to choose can be difficult.

Hire a contractor in Portugal

• Pros: This solution proves cost-effective when the worker isn’t exclusive to your company and has the flexibility to send a substitute for their duties on off days.
• Cons: Engaging a full-time worker solely dedicated to your company without proper employment classification constitutes a legal violation in Portugal. Penalties for such misclassification can range from fines to criminal charges.

Yes, as long as the worker is working for other companies, is able to decide how to do their own work, and can send another contractor in their absence.

In Portugal, a worker solely dedicated to your company and whose duties and tasks are dictated by your organization must be classified as an employee. Failing to do so constitutes a breach of Portugal employment law.

Misclassifying an employee in Portugal can lead to substantial fines, the obligation to pay outstanding holiday pay and social security contributions, the potential need to establish a local presence, and even legal action from the employee for breached employment rights.

The initial steps to establishing your business in Portugal involve registering it with the Commercial Register and obtaining a trade license from the relevant authorities.

While the initial registration process appears simple, establishing a physical office for tax purposes, opening a Portugal bank account (which often requires in-person presence), managing payroll software compliant with Portugal regulations, and fulfilling tax filing obligations add complexities to the overall setup.

Hiring people in Portugal means adhering to specific legal obligations. In simpler terms, HR compliance ensures your company strictly follows all employment and work practice regulations.

But why is it so important? HR compliance in Portugal goes beyond mere formalities; it safeguards both your employees and your business. Following employment regulations guarantees fair treatment for your workforce, encompassing aspects like sick leave, annual leave, minimum wage, and appropriate working hours. This not only fosters a positive work environment but also minimizes the risk of financial penalties, legal repercussions, and even lawsuits arising from non-compliance.

Partnering with Agility EOR as your Employer of Record in Portugal simplifies tax and social security obligations. We manage all employee-related filings and contributions, ensuring complete compliance, so you can focus on running your business with peace of mind.

While Agility EOR handles the complexities of Portugal employment law and compliance, your company remains responsible for day-to-day management and communication with your team, including addressing performance issues, taking disciplinary actions when necessary, and fostering a positive work environment through open communication.

Agility EOR handles the legal side of things in Portugal, so you can focus on managing your team and their daily tasks.

In Portugal, both employers and employees have to pay taxes. For employers, these include social insurance contributions, labor accident insurance, and contributions to the Wage guarantee fund, and for employees, they include social insurance, solidarity tax and Income tax.

Employees working under a Portugal Employer of Record benefit from legal protections and receive a standard employment contract. This includes statutory benefits like maternity leave, annual leave, and sick pay, along with applicable tax credits.

It’s important to note that the Portugal public healthcare system provides coverage for all residents, not just employees.

Agility EOR handles the administrative burden of HR compliance for you:

Trusted Partners: Agility EOR collaborates with leading Portugal employment lawyers and advisors. This ensures your employment contracts and other essential documents strictly adhere to all local legal requirements.

In-Depth Knowledge: We maintain a deep understanding of intricate aspects of Portugal employment law, including payroll, social security, data privacy, notice periods, and remote work regulations.

Swift Action: If an issue arises, our internal team are immediately on hand to help and assist.