Portugal ‘not ready’ for new labour law

By Mary Gahan, BBC News, Friday, 17 January, 2003, 17:40 GMT

Taking a sickie is about to become more difficult for workers in Portugal.

A new law has been passed to make it easier for the country's businesses to sack employees and crack down on the widespread problem of absenteeism.

“There is an uneven position between us and the workers,” says Joao Mendes Almeida, president of the Portuguese chambers of commerce and vice-president of the country's confederation of industry.

“Workers have more rights than we have.”

But that balance is changing.

Extra days off

Employees in Portugal take an average of 18 days off each year because of sickness—the highest rate in the European Union.

Mr Mendes Almeida says that the right to take time off sick is generally abused by people taking advantage of loopholes in the law.

“If you are on sick leave you get more money than if you were working in some circumstances.”

The new law will allow companies to sack employees who fail to turn up for work either four days in a row or eight days during a year without valid justification.

And, as an incentive, extra days of holiday will be awarded to people who avoid being absent.

Low wages

Portugal's productivity is the lowest in Europe and labour minister Antonio Bagao Felix has blamed it on the fact that each day 200,000 people are absent from work.

The government is anxious to boost productivity to help attract foreign investment.

Mr Mendes Almeida is certain that more overseas companies will be attracted if Portugal's labour laws are seen to be less bureaucratic, difficult and complicated.

But others argue that workers will suffer.

“These changes are going to change the balance of power between employers and employees as well as the balance of power between unions and employers' organisations—giving more power to employers,” says Maria da Paz Camboslima.

She is a lecturer at ISCTE, Portugal's higher institute for labour and business studies, and specialises in collective agreements.

Her concern is that strengthening the hand of employers could be damaging to people working in traditional, low-wage industries such as shoes and textiles.

Migrant workers

The new law includes flexibility measures. One says that employees can work a maximum of 60 hours a week; at the moment the maximum is 50 hours.

Another gives workers three days' notice of changes to hours instead of a week's notice.

And employers can move the location of a job without consulting employees.

“These changes could be very unprotective for workers in traditional sectors.

“Portuguese society is not prepared for this,” Ms Paz Camboslima says.

One of the changes the country has seen in recent years is an influx of educated and qualified migrant workers from Eastern Europe.

Anna Maria Grimaldi, an economist at Morgan Stanley, says that these workers have generally taken blue collar jobs.

But, she says, Portugal could increase its productivity if the government were able to relocate these workers into more highly skilled jobs.