Employers who enter into employment contracts up to two months are exempt from discounts to compensation funds. Diploma was approved Thursday by the Cabinet.
The government approved by the Cabinet diploma exempting employers who make contracts of employment within two months of discounts for Labor Compensation funds (FCT) and Labor Compensation Guarantee (FGCT).
The project which has been in public discussion reveals that the new rule will only apply to contracts signed after the entry into force of law.
“The emerging labor relations shorter duration of employment contracts or equal to two months are excluded from the scope of this law,” that is, the law that regulates the discounts the two funds. An exemption is also offered to temporary employment agencies that make contracts of the same duration.
A prize to anyone who makes short-term contracts? Ana Vieira, secretary general of the CCP, who also negotiated the diploma does not see it this way. “What was happening was that the legislation guarantees the exemption of very short-term contracts [used in Tourism] but not others.” In these contracts, sometimes for specific jobs, “the administrative cost [of discount procedures] for companies and the fund itself was almost higher than that would get” the account created by the fund, justified.
The statement on Thursday merely noted that the changes “aim to make legislative adjustments, aiming a better balance between the obligations of employers and the defense of workers’ interests in a climate of agreement and Cooperation between the Government and the social partners “. Notes, however, that the draft was published in the Bulletin Labour and Employment.
The compensation funds were created as a counterpart policy to reduce redundancy, who downloaded a lot, especially for the futures contracts over the adjustment program.
The aim of the fund is to ensure that there is enough money so that in the future the redundant workers always have access to at least half of the payment of compensation, regardless of financial situation of companies.
Discounts are not unlimited
The funds are designed to guarantee payment of up to 50% of compensation for dismissal. The new law leaves now clear that whenever the individual worker account is already guaranteed this right the company no longer has to cash and can re-do it if in the meantime the situation changes, for example due to a salary increase.
Ana Vieira, secretary general of the CCP, said that this is “solve a gap.” “From the time they reach that to which the fund has committed – that is to pay half the compensation – the company stops cashing Labor Compensation Fund,” he says. For most companies, this standard only take effect in a few years, because as the fund only began operating in October 2013 the accounts are still not enough.
In addition to adjusting some reporting deadlines, the new law also stipulates that companies that make an employment contract that recognizes an antique conferring the rights to more compensation to the maximum limits of the law are exempted from cash to Labor Compensation Fund.
Only 27% of new contracts are indefinite
Because it mandatory discount for all new contracts (with the exceptions that now come into force) This fund is also a good administrative base for analysis of labor market flows.
The data Business had access last week reveal that since the entry into force of background, in October 2013, were reported 1.49 million contracts , 674 000 of which are still in force.
Of these 674 000 contracts signed after October 2013 and which applied to 30 June this year, 51% (342,000) are the term; 21% (144,000) are of unspecified duration; and 27% (184,000) are no term or indefinitely. Ever consider all 1.49 million contracts signed since October 2013, whether or not in place, the weight of term contracts (57%) and a variable term (26%) is even higher when only 17% are permanent, such as the Business reported on the issue last Friday.
The data until February also indicate, indirectly, that companies are hiring at a salary Medium-base 581 euros, such as Business reported in March.
This account is made from the payment, taking into account the percentage applied. In June, 567,000 were active contracts for almost 95,000 employers descontarm to the substantive work compensation 3.15 million euros.
Overall, companies already discounted over these 21 months for FCt 40.4 million, but there are 1.9 million in debt funds.
Updated with more information and minor corrections between 16h and 16h23
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