What is the Gradual Recovery Support (“Apoio à retoma progressiva”)?

Yes. Companies with a turnover reduction of 25% or more in the month immediately preceding the month in which the initial application for support (or extension) is presented, compared to the same month of the previous year or to 2019, depending on the case, or in relation to the monthly average of the 6 months prior to that period; or for those who started the activity less than 24 months ago, the average between the beginning of the activity and penultimate calendar month prior to the month to which the initial request for support or extension refers, may access the Gradual Recovery Support with a temporary reduction of the normal working period ("NWP") of all or some of its employees.

This support is also applicable to members of statutory bodies who perform management functions, with declarations of remuneration, social security contributions and employees in their charge.

The temporary reduction of the NWP, per employee, has the following limits:

a) In the case of an employer with a turnover decrease of 25% or more, the reduction of the NWP per employee may be a maximum of 33% from January to June, 2021;

b) In the case of an employer with a 40 % or more turnover decrease, the reduction of the NWP per employee may be a maximum of 40 % from January to June, 2021;

c) In the case of an employer with a turnover decrease of 60% or more, the reduction of the NWP per employee may be a maximum of 60% from January to June, 2021;

In the case of an employer with a turnover decrease of 75% or more, the reduction of the NWP per employee may be up to:  

  • 100% in January, February, March and April 2021;
  • 75% in May and June 2021.

The NWP of the members of statutory bodies may be reduced up to the limit of the NWP reduction applicable to their employees, with a maximum limit of 60%.

Employees covered by this measure are entitled to: (i) salary for the hours effectively worked paid by the employer and (ii) compensation for the hours not worked, in the amount of 4/5 of gross normal pay between the months from January to June, 2021.

The maximum compensation amount is EUR 1,995.00 (3 x national minimum wage), and its calculation basis includes: (i) base salary, (ii) meal allowance when qualified as salary and (iii) bonuses, regular allowances (including shift bonus) and night work, when received for at least 10 months in the period of March 2019 to February 2020.

Employees covered by this measure will always be entitled to a minimum monthly amount of EUR 665.00 and may perform paid activity outside the company (the compensation being reduced accordingly).

Social Security pays 70% of the compensation, being the remaining 30% paid by the company.

If the employee receives a monthly amount lower than his/her gross normal salary, the amount of compensation - paid by social security - is increased to the extent strictly necessary to ensure that remuneration, up to a maximum of a gross normal salary corresponding to EUR 1,995.

If the Company’s turnover reduction is higher than 75%, an additional support of 35% of the gross normal salary for hours worked by employees with reduced normal working hours will also be paid by Social Security.

 

Companies which have applied to the gradual recovery support are entitled to exemption from the payment of social security contributions?

Micro, small and medium companies benefiting from this measure will also be entitled to a 50% partial exemption from the payment of social security contributions regarding the compensation paid to employees with a reduced working period, with reference to the months in which the Company has benefited from the support.

 

Companies benefiting from the Gradual Recovery Support have the right to a training plan?

Yes, for each month of Gradual Recovery Support with temporary reduction of the NWP, the employer is entitled to a training plan.

The training plan entitles the employee to a scholarship of a maximum of 70% of the Social Support Index (IAS) (EUR307.17) per employee covered, intended for the employer, who is entitled to the amount equivalent to 30% of the IAS, and the employee, who is entitled to the amount equivalent to 40% of the IAS in situations where the employee's gross salary is lower than his normal gross salary, and should:

a) Be implemented in coordination with the employer, being the IEFP, I.P., responsible for its approval, and may be developed at a distance, when possible and the conditions allow it;

b) Contribute to the improvement of the employee’s professional skills, increasing their level of qualification whenever possible, and contribute to increasing the company's competitiveness;

c) Correspond to the training modalities foreseen under the National System of Qualifications;

d) Be implemented outside the effective working hours, as long as within the NWP;

e) Start during the period in which the employer is benefiting from the gradual recovery support;

f) Ensure the attendance of, at least, 50 hours of training per employee in a 30-day period.

The scholarship is borne by IEFP, I.P., and is paid directly to the employer, when applicable, who assumes the responsibility of paying the employee the amount due, according to the number of hours of training effectively attended.

Additionally, during the period of reduction of 100% of the NWP, the employee’s duties which do not imply the effective provision of work are maintained, namely the duty to attend professional training sessions indicated by the employer and the duty to comply with other orders and instructions arising from the power of direction that do not involve the provision of work.

 

Can Companies dismiss employees during this support?

During the period of the measure and for a period of 60 days following its completion, companies are may not terminate employment contracts (or start the correspondent legal procedures) by:

(a) Collective dismissal;

(b) Individual redundancy; and/or

(c) Dismissal for unsuitability.

 

Are employees with a reduction of the NWP entitled to receive full Christmas allowance?

Yes, the employee is entitled to a full Christmas allowance. The allowance is paid:

(a) by social security: the amount corresponding to the twelfth of half of the compensation for the number of months of support; and

(b) by the employer: the remainder;

as long as the date of payment of this allowance has coincided with the period of application of the Gradual Recovery Support.

 

Can companies which have resorted to the lay-off regulated by the Labour Code resort to the Gradual Recovery Support?

Yes. Companies which have resorted to the application of the reduction or suspension measures regulated in the Labour Code (lay-off) and intend to access the Gradual Recovery Support, can do so, without being applied the impediment equivalent to half of the period previously used in the application of those measures.

 

Companies which have resorted to the Extraordinary Incentive to Return to Normal Business Activity and are waiting for the payment of the 2nd instalment, can resort to the Gradual Recovery Support?

No, these measures are not cumulative and exclude each other until January 2021.

From February onwards it will be possible to make use of the Gradual Recovery Support.

 

__________________________

This information is being updated on a regular basis.

All information contained herein and all opinions expressed are of a general nature and are not intended to substitute recourse to expert legal advice for the resolution of real cases.