PORTUGAL Law and Practice Contributed by: Nuno Ferreira Morgado and Júlia Mendes da Costa, PLMJ
child’s life to provide assistance to the child. There is no mandatory payment of the employer during these leave periods. Employees with children under 12 years of age or, irrespective of age, with a disability or chronic illness who live with the employee and who are under their care, and employees with the status of non-formal caregivers, are entitled to work part-time or to work under flexible working hours arrangements. Sick Leave Employees are entitled to time off from work for ill - ness or injury, which is paid by the Portuguese Social Security protection schemes, provided they meet all the eligibility requirements. The Social Security pro - tection schemes pay sick pay to employees who are absent from work as a result of illness or injury. The employee can receive sick pay for a total of 1,095 days. Sick pay is calculated based on the employee’s remuneration reference for Social Security purposes and varies between 55% and 75% depending on the period of illness. The sickness leave suspends the employment con - tract as of 30 days and has no maximum period. Employees have the obligation to communicate absences due to sickness as soon as possible and may be required to present medical documentation proving the sickness. In some cases, CBAs provide specific rules covering employee illness or injury. Protection of Confidential Information During the employment relationship, employees are bound by a confidentiality duty. The parties may also agree upon a confidentiality duty after termination.
In cases of employees who hold positions that entail a special level of trust (eg, management positions) or that have access to sensitive information from a competition standpoint, the restricted period can be extended to a maximum of three years. The minimum stay duty can be set at a maximum of three years. Employees covered by a post-contractual non-com - pete duty must receive financial compensation during the restricted period. Portuguese law does not set a specific criterion to determine the compensation to be paid during the non-compete period. The Con - stitutional Court case law follows the understanding that the compensation must be fair, adequate and proportional. This means that the non-compete duty financial compensation must be sufficient to sup - port the employee during the restricted period, tak - ing into account their salary while employed by the company. Although the law leaves the parties some room to establish the time of payment, the purpose of the compensation is to ensure that the employee can obtain a suitable income source during the restricted period. It is therefore recommendable that the pay - ment of the compensation be made on a monthly basis during the restricted period. If any agreement fails to provide for compensation, or if the compensation is considered insufficient, the agreement will be null and void, and will thus release the employee from complying with it and the employ - er from paying the compensation. The amount of compensation may be reduced in cases where the employer has expended large sums on the employee’s vocational training. The remedies for a non-compete breach are limited to the possibility of seeking compensation from the former employee. The burden of argument, and the quantification and proof of the damage, falls solely on the former employer. In many cases, it is quite hard to quantify the damage as the value of information is difficult to measure. In addition, it is quite difficult to prove damage that arises as a result of the employee’s behaviour. In order to mitigate this risk, it is usual for the parties to agree on a penalty award.
2. Restrictive Covenants 2.1 Non-Competes
Portuguese employment law allows restrictive cov - enants, notably confidentiality, non-competition (and in that context, non-solicitation) and/or minimum stay obligations. The duration of the post-employment non-compete duty cannot exceed two years from the termination of employment.
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